ASX dividend shares can be a great source of passive income for investors because of their ability to share profits year after year with shareholders.

Some businesses trade at relatively low multiples of their earnings, which can support a relatively high dividend yield. Additionally, some businesses may pay out a high level of their earnings each year, which can also lead to a higher dividend yield. When a business has both elements in its favour, that can mean a very high dividend yield.

The two ASX dividend shares I’ll discuss both have the potential to yield double-digit dividends in the coming years.

GQG Partners Inc (ASX: GQG)

GQG is one of the larger listed fund managers on the ASX, with a market capitalisation of close to $5 billion. I think it’s very good value at that price.

The business has been paying investors a dividend payout ratio of around 90% of its distributable earnings in recent times, which means a very good dividend yield for investors.

Its latest quarterly dividend alone equates to a dividend yield of 3.4%. That’s an annualised dividend yield of close to 14%, at the time of writing.

If the business can just maintain its dividend at this level, then that’s an impressive return by itself.

I also think the ASX dividend share can deliver capital growth for shareholders if the investment performance of its funds can turn around. It recently took a defensive positioning with its portfolios because of the perceived overvaluation of AI/tech businesses – a prudent move, in my eyes.

While being defensive has led to underperformance in 2025, I think the recent decline of tech valuations will have helped GQG’s funds catch up.

Based on the latest quarterly dividend, the GQG share price is currently trading at less than 7x its distributable annualised net profit, which seems cheap, particularly if it can deliver stronger investment performance/stabilise the funds under management (FUM) outflows.

Shaver Shop Group Ltd (ASX: SSG)

Shaver Shop is one of my favourites for ASX dividend shares, boasting a large yield due to its track record of consistently delivering and regularly growing dividends. It has grown its annual dividend almost every year in the last several years, aside from one year (FY24) when it maintained its payout.

The company has 126 stores, with 116 in Australia and 10 in New Zealand. It claims to be the market leader in a growth sector. Its products are focused on DIY grooming, personal care, hair and beauty appliances for men and women, with a specialisation in premium products.

The ASX dividend share increased its payout to 10.3 cents in FY25, which translates into a grossed-up dividend yield of 10.1%, including the franking credits. If it hikes its dividend slightly to 10.4 cents in FY26, that’d be a grossed-up dividend yield of 10.25%.

I’m optimistic the company can grow its profits further with the growth of its own brand (called Transform-U), additional exclusive agreements with new shaver brands, more stores, and the potential to increase margins as it becomes larger.

According to the estimates on CMC Markets, the business is trading at 12x FY26’s forecast earnings.

The post Get paid huge amounts of cash to own these ASX dividend shares! appeared first on The Motley Fool Australia.

More reading

• I’d buy 11,429 shares of this ASX stock to aim for $100 a month of passive income
• Here are the top 10 ASX 200 shares today
• 3 ASX 200 stocks storming higher in this week’s sinking market
• Why DroneShield, GQG Partners, Origin Energy, and Worley shares are falling today
• Here are the top 10 ASX 200 shares today

Motley Fool contributor Tristan Harrison has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has recommended Gqg Partners and Shaver Shop Group. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

ASX 200 tech shares are in a bear market, with the S&P/ASX 200 Information Technology Index (ASX: XIJ) down 24% from its peak.

A bear market is defined as a 20% (or more) fall from the most recent high point.

The ASX 200 tech stock index reached an all-time high of 3,060.7 points on 19 September.

Yesterday, the index closed at 2,317.6 points, down 743 points in just a little over two months.

By comparison, the S&P/ASX 200 Index (ASX: XJO) hit a record 9,115.2 points on 21 October and has slipped 6.3% since its peak.

The other market sectors have also fallen from their recent highs, set between August and October, but not as dramatically as technology.

Healthcare is also in a bear market, down 23.6%, but that decline has occurred over 10 months since the sector’s peak on 31 January.

Take a look.

S&P/ASX 200 market sector	52-week high	When	Fall since the high
Materials (ASX: XMJ)	20,192.4 points	21 October	(3.4%)
Industrials (ASX: XNJ)	8,811.8 points	27 October	(3.6%)
Utilities (ASX: XUJ)	10,323.9 points	29 October	(4.8%)
Energy (ASX: XEJ)	9,460.2 points	27 August	(8.8%)
A-REIT (ASX: XPJ)	1,975.8 points	21 August	(9%)
Communication (ASX: XTJ)	1,986.2 points	22 August	(9.2%)
Financials (ASX: XFJ)	9,978.4 points	28 October	(9.7%)
Consumer Staples (ASX: XSJ)	12,992.9 points	26 August	(9.9%)
Consumer Discretionary (ASX: XDJ)	4,620.6 points	21 August	(13.2%)
Healthcare (ASX: XHJ)	46,575.4 points	31 January	(23.6%)
Information Technology (ASX: XIJ)	3,060.7 points	19 September	(24.3%)

Why are technology and healthcare in a bear market?

ASX 200 tech and healthcare shares are in bear territory partly because each sector’s largest company has been significantly derated.

In the tech sector, WiseTech Global Ltd (ASX: WTC) shares have fallen 51% from their 52-week high of $134.26 on 5 December 2024.

Governance concerns have plagued the logistics software supplier this year, along with investors’ disappointment with FY25 earnings.

In the healthcare sector, CSL Ltd (ASX: CSL) shares are down 37% since their 52-week high of $290.32 per share on 8 January.

The global biotech has been hit by weaker global flu vaccine demand and is undergoing a major restructure, including 3,000 job cuts.

It’s notable that ASX 200 healthcare shares have fallen 23.6% over 10 months, while tech shares have plummeted 24.3% in two months.

This may indicate that ASX 200 tech shares are facing other immediate tailwinds.

One of them is the concern that artificial intelligence (AI) is creating a market bubble.

We saw this play out last week, with markets experiencing high volatility ahead of a quarterly report from AI chip giant Nvidia Corp (NASDAQ: NVDA).

This led to significant fluctuations in the ASX 200, with technology the worst-performing sector of the week, falling 4.07%.

Joe Koh and Elan Miller, portfolio managers of Blackwattle’s Large Cap Quality Fund, said many clients are asking about an AI bubble.

Koh and Miller said uncertainty over further interest rate cuts was another factor weakening ASX 200 tech shares in recent weeks.

They commented:

Some of the weakness was company-specific (such as the ASIC investigation into Wisetech executives’ share trading), but there was also increasing concern around the health of both US and Australian economies.

Higher interest rate expectations following the September inflation numbers also affected growth names in the IT sector, whose earnings and cash flows are further into the future and are therefore more impacted by higher discount rates.

Look outside the tech sector for AI gains: expert

Joe Davis, Vanguard’s Global Chief Economist, expects a rotation out of tech shares as AI matures.

He suggests investors will need to look beyond the tech sector if AI does, indeed, transform the global economy, as markets expect.

Davis said:

In every technology cycle, the firms producing the new technology do initially outperform (sometimes by fantastic or even “irrational” levels); but as the technology spreads, it is non-tech companies that benefit.

That is what happened with manufacturers and service companies during the age of electricity.

Similarly, in the age of AI, health care or financial companies could hold the most transformational potential, implying a rotation in stock outperformance, with the best returns shifting from technology stocks to other sectors.

ASX 200 tech share prices in 2025

Here is how the biggest ASX 200 tech shares by market cap are faring in 2025 so far.

WiseTech shares are down 47% in the year to date.

The Xero Ltd (ASX: XRO) share price is down 28%.

TechnologyOne Ltd (ASX: TNE) shares are down 0.1%.

Nextdc Ltd (ASX: NXT) shares are down 9.3%.

The Life360 Inc (ASX: 360) share price is up 84%.

Codan Ltd (ASX: CDA) shares are up 85%.

Megaport Ltd (ASX: MP1) shares are up 87%.

Dicker Data Ltd (ASX: DDR) shares are up 21%.

The Iress Ltd (ASX: IRE) share price is down 2.2%.

The Siteminder Ltd (ASX: SDR) share price is up 5.9%

The post Bear market alert: ASX 200 tech shares down 24% since September peak appeared first on The Motley Fool Australia.

More reading

• These ASX 200 shares could rise 40% to 90%
• 3 amazing ASX growth shares to buy and hold forever
• No savings at 55? Here’s how to still retire with passive income
• Morgans just upgraded these ASX 200 shares
• Down 21% in 30 days, this top ASX 200 stock now looks on sale to me

Motley Fool contributor Bronwyn Allen has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended CSL, Life360, Megaport, Nvidia, SiteMinder, Technology One, WiseTech Global, and Xero. The Motley Fool Australia has positions in and has recommended Dicker Data, Life360, SiteMinder, WiseTech Global, and Xero. The Motley Fool Australia has recommended CSL, Nvidia, and Technology One. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

When you’re building a passive income stream, reliability matters just as much as a dividend yield.

Plenty of companies offer attractive payouts today, but far fewer can maintain, and ideally grow, those dividends.

Thankfully, the ASX is home to several high-quality businesses with strong cash flow, resilient demand, and long records of shareholder returns.

If I were constructing a long-term income portfolio right now, these three ASX dividend stocks would be at the top of my list.

APA Group (ASX: APA)

APA Group remains one of the most dependable income generators on the ASX. As Australia’s largest owner of gas transmission infrastructure, APA earns stable, regulated revenue by transporting a large portion of the nation’s domestic gas through its 15,000km pipeline network. Its assets span gas pipelines, power generation, electricity transmission and renewable energy, which are all industries with high barriers to entry and predictable cash flows.

Management has increased the distribution every year for more than a decade, and the company continues to invest heavily in long-term growth projects across its East Coast Gas Grid, remote power assets and interconnector upgrades. Analysts expect these developments, alongside disciplined cost control, to support further distribution growth well into the future.

Based on its current share price, APA shares are expected to deliver a partially franked dividend yield of 6.2% in FY 2026.

Transurban Group (ASX: TCL)

Toll road operator Transurban is another high-quality ASX dividend stock for long-term income seekers. Its network of roads stretches across Sydney, Melbourne, Brisbane and North America, giving the business a highly defensive earnings base. Traffic volumes tend to rebound quickly from economic slowdowns, and population growth, urbanisation and rising congestion continue to underpin long-run demand.

Because Transurban operates under long-dated concession agreements, it enjoys extraordinary cash-flow visibility. Toll escalations, many of which track inflation, help support predictable and growing distributions. The company also has a robust development pipeline, including major upgrades and expansions that will underpin revenue growth for years to come.

The consensus estimate is for a dividend yield of approximately 4.6% in FY 2026.

Woolworths Group Ltd (ASX: WOW)

Woolworths may not be the highest-yielding stock on the ASX, but what it lacks in headline yield it makes up for in consistency. As Australia’s largest supermarket operator, Woolworths generates steady cash flow through all types of economic conditions. Shoppers may trade down during tougher periods, but they never stop buying essentials.

Its digital transformation, supply-chain improvements and focus on customer loyalty continue to strengthen margins and earnings quality. Over time, these enhancements support sustainable, fully franked dividends, which is exactly what long-term income investors should look for from a defensive blue chip.

Based on current estimates, Woolworths shares offer a fully franked FY 2026 dividend yield of 3.3%.

The post 3 ultra-reliable ASX dividend stocks I’d buy for long-term income appeared first on The Motley Fool Australia.

More reading

• No savings at 55? Here’s how to still retire with passive income
• Best buy for dividends today: Coles or Woolworths shares?
• These top ASX dividend stocks offer 5% yields
• What’s driving a 9% divergence in ASX 200 consumer staples vs. discretionary shares?
• Should you buy Woolworths and these ASX dividend shares?

Motley Fool contributor James Mickleboro has positions in Woolworths Group. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Transurban Group. The Motley Fool Australia has positions in and has recommended Apa Group, Transurban Group, and Woolworths Group. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

The AGL Energy Ltd (ASX: AGL) share price closed in the red on Tuesday afternoon. The ASX energy stock ended the day 0.22% lower at $8.97 a piece. That means that over the month, the shares have now fallen 1.32%. They’re down 21.3% since the start of the year.

A lot of the company’s share price decline is due to weak earnings for FY25. In August, AGL posted a 9% drop in its underlying EBITDA, a 21% decline in underlying NPAT, and a $98 million loss after tax. Investors were spooked, and it caused a sharp sell-off and a 21% plummet of its share price.

At the time, AGL also set a conservative guidance for FY26. It said it expected underlying EBITDA to be between $1,920 million and $2,220 million, and NPAT of $500 million to $700 million. The company said it expects plant availability and fleet flexibility to improve further, with the Liddell Battery coming online in early 2026 and ongoing investment in new flexible assets and customer growth initiatives.

Why buying the ASX energy stock is a no-brainer

AGL has been making some great growth progress recently. In late October, the company announced plans to buy four new gas turbines for approximately $185 million from Siemens AB. The move is part of AGL’s strategy to provide backup capacity for renewable energy.

The Australian Energy Market Operator (AEMO) assigned 176MW of Peak Certified Reserve Capacity to the project, commencing from 1 October 2027.

Shortly later, the company announced the sale of a 19.9% stake in Tilt Renewables for $750 million. It will retain a small residual 0.1% stake. AGL said it will use the proceeds from the divestment to continue to deliver AGL’s strategy, “including to fund its investment in flexible, dispatchable capacity and to provide additional balance sheet flexibility”. 

I think AGL’s latest developments mean the shares are now attractively priced and that there are signs of a price recovery ahead. It’s a great buying opportunity for investors to get in ahead of a potential uptick.

What do analysts think?

According to TradingView data, 7 out of 11 analysts have a buy or strong buy rating on AGL shares. The average target price on the ASX energy stock is $11.14, and the maximum is $12.24. These target prices represent a potential 24.2% to 36.5% upside for investors at the time of writing.

Macquarie analysts confirmed their outperform rating on AGL shares and $11 target price in September. At the time of writing, this represents a potential 22.6% upside for investors over the next 12 months. The broker noted that wind power purchase agreements (PPAs), a long-term contract for a buyer to purchase electricity at a fixed price, is pricing closer to $120 per MWh (megawatt-hour). According to Macquarie, this suggests an electricity price of $150 per MWh, or higher, will be needed by 2030.

The post 1 no-brainer ASX energy stock to buy with $500 right now! appeared first on The Motley Fool Australia.

More reading

• How to prepare for a share market crash… before it’s too late
• AGL Energy unlocks value with $750m Tilt Renewables stake sale
• ASX 200 energy stock lifts off on $185 million news

Motley Fool contributor Samantha Menzies has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Macquarie Group. The Motley Fool Australia has positions in and has recommended Macquarie Group. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

The ASX 200 has been volatile lately, but that hasn’t stopped analysts from identifying pockets of real opportunity.

In fact, several high-quality companies are now trading at valuations that suggest potential for significant upside over the next 12 months.

For example, the two ASX 200 shares listed below have been named as buys by analysts and tipped to rise 40% or more. Here’s what they are recommending:

Sonic Healthcare Ltd (ASX: SHL)

Sonic Healthcare could be a cheap ASX 200 share to buy.

This leading diagnostic company has been struggling over the past couple of years after COVID-19 testing revenue dried up.

However, with a clean slate and organic growth returning, now could be a good time to snap up shares.

Demand for pathology and diagnostic services is both essential and growing, supported by ageing populations and increasing prevalence of chronic disease. Sonic continues to invest in automation, digital workflow optimisation, and efficiency improvements, all of which are expected to support margin expansion over the medium term.

Bell Potter is positive on the company. It said:

One can expect SHL to generate solid mid-high single digit organic EPS growth with addon benefit of acquisitions to drive double-digit growth on a normal basis. SHL is a sold compound generator, which is why it holds appeal in our view.

The broker has a buy rating and $33.30 price target on its shares. Based on its current share price of $23.19, this implies potential upside of 44% for investors over the next 12 months. It also expects an attractive 4.7% dividend yield in FY 2026.

Xero Ltd (ASX: XRO)

Another ASX 200 share with potential to rise strongly is cloud accounting leader Xero.

It has delivered consistent growth for more than a decade, and the company continues to benefit from the global shift toward digitised financial management. At the last count, it boasted 4.59 million subscribers and annualised monthly recurring revenue of NZ$2.7 billion.

However, this is just a fraction of its total addressable market, which is an estimated 100 million small businesses globally. Clearly, there is scope for a significant increase in recurring revenue over the next decade. Especially with management aiming to grow its average revenue per user metric alongside its subscribers.

In light of this, the team at Macquarie thinks investors should be taking advantage of recent share price weakness. It said:

Mgmt is walking the walk, making data-driven decisions that invariably lead to better capital allocation outcomes. We have high conviction in >12mo story, driven by the US opportunity. Gusto and Melio are the platform for US growth and mgmt is executing quickly. Reiterate Outperform.

Macquarie has an outperform rating and $230.30 price target on its shares. This suggests the upside of 91% is possible from current levels.

The post These ASX 200 shares could rise 40% to 90% appeared first on The Motley Fool Australia.

More reading

• What $100 a week in ASX shares could become in 20 years
• Top 10 most-traded ASX shares last week
• Is the 2025 ASX share selloff your chance to buy generational bargains?
• Should you buy Mesoblast, Paladin Energy, and Xero shares?
• Macquarie tips 54% upside for this beaten down ASX All Ords healthcare stock

Motley Fool contributor James Mickleboro has positions in Xero. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Macquarie Group and Xero. The Motley Fool Australia has positions in and has recommended Macquarie Group and Xero. The Motley Fool Australia has recommended Sonic Healthcare. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

If you are on the lookout for some ASX growth shares to buy and hold, then it could be worth checking out the three named below.

They are high-quality companies with strong long-term growth potential and the approval of analysts. Here’s what you need to know about them:

Life360 Inc. (ASX: 360)

Life360 has become one of Australia’s quiet global tech champions. Its family safety app continues to expand rapidly, with more than 91 million monthly active users and 2.7 million paying circles. Subscription revenue remains strong, annualised monthly revenue has surged, and the company is generating positive operating cash flow while holding more than US$450 million in cash. With a massive global addressable market, a growing product suite and enviable network effects, Life360 is the kind of scalable platform that can keep compounding as it matures.

Morgan Stanley is a fan. It has an overweight rating and $58.50 price target on its shares.

Pro Medicus Ltd (ASX: PME)

Another ASX growth share that could be a top buy and hold option is Pro Medicus. This health imaging technology company is arguably one of the highest-quality businesses on the ASX. Its Visage imaging platform is now used by some of the most important hospital networks in the United States, delivering huge efficiency benefits to radiologists. Every major contract win adds high-margin recurring revenue, and the company’s capital-light model means profits convert neatly into cash. And with a significant total addressable market and expansion opportunities into other ologies, the future looks bright for this one.

Bell Potter is bullish and has a buy rating and $320.00 price target on the company’s shares.

Temple & Webster Group Ltd (ASX: TPW)

A third ASX growth share that could be a great long term pick for investors is Temple & Webster. Over the past decade, it has become the dominant online furniture retailer in Australia, but its opportunity is far from exhausted. Online penetration in the Australian homewares category remains low compared to markets like the UK and the US, giving the company significant headroom for growth. Its private-label expansion and logistics improvements continue to strengthen margins and boost customer retention. As more shoppers shift online, Temple & Webster looks well placed to capture market share for many years and grow its earnings at an above-average rate.

The team at Macquarie is positive on the company. It recently put an overweight rating and $31.30 price target on its shares.

The post 3 amazing ASX growth shares to buy and hold forever appeared first on The Motley Fool Australia.

More reading

• Here are the top 10 ASX 200 shares today
• Why Gentrack, Monash IVF, Pro Medicus, and Qube shares are racing higher today
• Pro Medicus shares charge higher on big news
• 3 ASX growth stars I’d back for the next five years
• 5 things to watch on the ASX 200 on Monday

Motley Fool contributor James Mickleboro has positions in Life360, Pro Medicus, and Temple & Webster Group. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Life360, Macquarie Group, and Temple & Webster Group. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has recommended Pro Medicus. The Motley Fool Australia has positions in and has recommended Life360 and Macquarie Group. The Motley Fool Australia has recommended Pro Medicus and Temple & Webster Group. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

The Betashares Nasdaq 100 ETF (ASX: NDQ) has become one of the most popular international ETFs on the ASX.

This is for good reason.

This fund gives Australian investors incredibly easy access to the world’s most innovative companies, many of which have reshaped entire industries and delivered outstanding long-term returns.

If you’re looking for a simple, growth-focused investment to hold for many years, here are five reasons why this ASX ETF could deserve a spot in your portfolio.

Reason 1: Exposure to the world’s technology leaders

The Betashares Nasdaq 100 ETF tracks the Nasdaq-100 Index, which includes many of the most influential companies on the planet. This means instant exposure to giants such as Apple (NASDAQ: AAPL), Microsoft (NASDAQ: MSFT) and Nvidia (NASDAQ: NVDA). These are the businesses driving advances in artificial intelligence, cloud computing, semiconductors and digital services.

These companies have enormous competitive advantages, global customer bases, and innovation pipelines that could continue powering growth for years to come.

Reason 2: A simple way to invest in the AI boom

Artificial intelligence is becoming one of the defining themes of the decade, and this ASX ETF gives you broad, diversified exposure to the companies leading the wave.

Nvidia’s GPUs power most major AI models. Microsoft is integrating AI across its entire product ecosystem. And Alphabet (NASDAQ: GOOG), Meta Platforms (NASDAQ: META), and Amazon (NASDAQ: AMZN), are embedding AI into everything from advertising to cloud services.

Instead of trying to pick which AI stocks will win, this fund lets you own many of the global leaders in one trade.

Reason 3: Strong long-term performance

The Nasdaq-100 index has been one of the best-performing major indices over the past 10 years, driven by strong earnings growth and the increasing dominance of technology-driven companies.

This has seen the Betashares Nasdaq 100 ETF deliver an incredible average return of 20% per annum since 2015.

And while past performance is not guaranteed to continue, the index has historically outpaced broader US and global markets due to its focus on innovation-heavy sectors.

Reason 4: Diversification

Although the Betashares Nasdaq 100 ETF is often viewed as a tech ETF, it provides exposure across several fast-growing sectors. The fund includes companies in biotechnology, digital entertainment, cybersecurity, e-commerce, communication services, and cloud computing. This diversification helps spread risk while still capturing some of the most powerful structural growth trends in the global economy.

Reason 5: A set-and-forget investment

The Betashares Nasdaq 100 ETF is arguably ideal for investors who want global growth without constantly monitoring the market.

The index automatically updates to reflect the top 100 non-financial stocks listed on the Nasdaq, meaning the fund naturally adjusts as winners rise and weaker businesses fall away. This ensures the portfolio stays focused on the strongest companies in the index at all times.

Foolish takeaway

Whether you’re chasing long-term growth, looking to ride the AI and technology megatrends, or simply want exposure to the world’s most innovative companies, the Betashares Nasdaq 100 ETF offers a very efficient and compelling way to invest globally.

The post 5 reasons to buy the Betashares Nasdaq 100 ETF appeared first on The Motley Fool Australia.

More reading

• No savings at 55? Here’s how to still retire with passive income
• What $5,000 invested in ASX ETFs today could become in 10, 15, and 20 years
• How to make $50,000 of passive income a year from ASX shares
• My plan of attack for the next share market crash
• 5 ASX ETFs to buy to supercharge your portfolio in 2026

Motley Fool contributor James Mickleboro has positions in BetaShares Nasdaq 100 ETF. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Alphabet, Amazon, Apple, BetaShares Nasdaq 100 ETF, Meta Platforms, Microsoft, and Nvidia. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has recommended the following options: long January 2026 $395 calls on Microsoft and short January 2026 $405 calls on Microsoft. The Motley Fool Australia has positions in and has recommended BetaShares Nasdaq 100 ETF. The Motley Fool Australia has recommended Alphabet, Amazon, Apple, Meta Platforms, Microsoft, and Nvidia. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

The ‘big four’ ASX bank shares have had a phenomenal run since late 2023.

The S&P/ASX 200 Banks Index (ASX: XBK) has ripped 51% over this period versus a 22% lift for the S&P/ASX 200 Index (ASX: XJO).

Commonwealth Bank of Australia (ASX: CBA) shares rose from just under $100 in November 2023 to a record of $192 in June this year.

Since then, CBA shares have come off the boil, falling 20% to a closing value of $153.14 yesterday.

Meanwhile, the smaller players of the ‘big four’ have surged to all-time highs.

The Westpac Banking Corp (ASX: WBC) share price hit a record of $41 this month and closed at $38.02 yesterday, up 12% in FY26.

National Australia Bank Ltd (ASX: NAB) shares soared to a record $45.25 this month and closed at $40.63 yesterday, up 3% in FY26.

ANZ Group Holdings Ltd (ASX: ANZ) shares reached a record $38.93 this month and closed at $34.91 yesterday, up 20% in FY26.

The following chart shows the big four’s performance since November 2023 and the recent divergence of the CBA share price.

How do experts rate the big four banks?

Brokers appear pretty pessimistic on the big four ASX bank shares today.

Macquarie has neutral ratings on ANZ and NAB shares with 12-month price targets of $35 and $39, respectively.

The broker has underperform ratings on CBA and Westpac shares with price targets of $106 and $31, respectively.

All of those price targets imply downside from here.

Bell Potter is underweight on CBA shares and overweight on ANZ shares.

On CBA shares, the broker says:

We are moving further Underweight in CBA, establishing it as our largest active underweight position in the Core portfolio.

The bank’s valuation premium has expanded to an extreme and, in our view, unsustainable level, trading at a P/E multiple that is ~40% above the peer average.

On ANZ shares, the broker says:

We are moving to an overweight position in ANZ, which we see as the clear relative value proposition and our preferred holding in the sector. ANZ delivered the cleanest and highest-quality result of the recent reporting season, providing a tangible “self-help” story that NAB and CBA lack, while Westpac’s is relatively priced in.

Wilsons Advisory rates ANZ as the best value among the ASX bank shares “on all key valuation metrics”.

Morgans has a trim rating on ANZ shares with a price target of $33.09. The broker has a sell rating on NAB and CBA shares.

Wilsons notes that Westpac shares offer an attractive dividend yield and the bank has “the strongest balance sheet” of the big four.

Buy this ASX bank share instead

On The Bull this week, Tony Paterno from Ord Minnett revealed a buy rating on small-cap ASX bank share, MyState Ltd (ASX: MYS).

Paterno explained:

MYS is a national diversified financial services group. Brands include MyState Bank, Auswide Bank, Selfco and TPT Wealth.

We view MyState as an attractive income stock with dividends to reflect stronger earnings growth during the next three years as Auswide merger synergies are delivered.

In an expensive banking sector with only modest forecast earnings and dividend growth to fiscal year 2028, we believe MYS is a standout.

The post Buy this ASX bank share instead of the ‘big four’: expert appeared first on The Motley Fool Australia.

More reading

• Invested in NAB shares? Here are the key dates for 2026
• Top 10 most-traded ASX shares last week
• This is the price at which I would buy CBA shares
• $20,000 of ANZ shares can net me a $1,220 passive income!
• Age Pension worries? 7 income stocks to consider for retirement

Motley Fool contributor Bronwyn Allen has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Macquarie Group. The Motley Fool Australia has positions in and has recommended Macquarie Group. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.