The Austal Ltd (ASX: ASB) share price is in focus after the company announced it has been awarded a further contract extension worth more than $135 million to build two new Evolved Cape-class Patrol Boats for the Australian Border Force, bringing the total contracted to 14 vessels.

What did Austal report?

• Contract extension worth over $135 million for two additional Evolved Cape-class Patrol Boats
• Total number of Evolved Cape-class vessels contracted up to 14
• Nine vessels already delivered to the Royal Australian Navy
• Two more Evolved Cape-class boats already under construction for the Australian Border Force
• New boats to be built at Austal’s Henderson, Western Australia shipyard
• Strong ongoing relationship with Australian Border Force and Department of Defence

What else do investors need to know?

Austal has supplied the Australian Border Force and Royal Australian Navy with 12 Evolved Cape-class Patrol Boats since 2020, and the latest order lifts that to 14. This highlights continued confidence in Austal’s naval capability and in the Cape-class platform’s performance.

The vessels feature modern crew accommodations for up to 32 personnel as well as advanced systems designed to boost operational effectiveness and sustainability. Construction of these additional patrol boats will support a national shipbuilding supply chain based in Western Australia.

Austal continues to support Australia’s defence requirements through other programs too, including the Guardian-class Patrol Boat initiative, with 22 out of 24 vessels already delivered.

What did Austal management say?

Chief Executive Officer Paddy Gregg said:

Over the past five years, the Evolved Cape-class Patrol Boats have proven themselves as highly capable, reliable assets for Australia’s border protection missions…With nine Evolved Capes already delivered and performing exceptionally with the Royal Australian Navy, and two more already under construction for the Australian Border Force, this new order further enhances Australia’s maritime surveillance and response capability across Northern Australia and our vast maritime domain.

What’s next for Austal?

Austal will construct the two new vessels at its Henderson, WA facility, backed by its experienced supply chain and project teams. The company continues to focus on strengthening Australia’s sovereign naval shipbuilding and maritime support capabilities through high profile defence contracts.

Looking ahead, Austal says it will keep providing in-service support for both Cape-class and Evolved Cape-class patrol boats and maintain progress on the Guardian-class program, reinforcing its position as a key partner for Australia’s naval and border protection.

Austal share price snapshot

Over the past 12 months, Austal shares have risen 106%, outperforming the S&P/ASX 200 Index (ASX: XJO) which has risen 5% over the same period.

View Original Announcement

The post Austal secures $135m patrol boat contract extension appeared first on The Motley Fool Australia.

More reading

• 5 things to watch on the ASX 200 on Friday
• Here are the top 10 ASX 200 shares today
• Austral lands $1 billion defence deal. So why are its shares barely moving?
• Qube Holdings books $100m profit after selling Beveridge property
• Bendigo and Adelaide Bank hit with APRA capital charge, faces AUSTRAC probe

Motley Fool contributor Laura Stewart 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 no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips. This article was prepared with the assistance of Large Language Model (LLM) tools for the initial summary of the company announcement. Any content assisted by AI is subject to our robust human-in-the-loop quality control framework, involving thorough review, substantial editing, and fact-checking by our experienced writers and editors holding appropriate credentials. The Motley Fool Australia stands behind the work of our editorial team and takes ultimate responsibility for the content published by The Motley Fool Australia.

While interest rates could rise in 2026, they are still expected to remain lower than historical levels for the foreseeable future.

In light of this, term deposits are once again looking less attractive for income-focused investors. And while they offer certainty, they also cap returns and provide no opportunity for income growth or capital appreciation.

By contrast, ASX dividend shares can deliver regular income, potential dividend growth, and upside if the underlying business performs well.

For investors prepared to tolerate some share price volatility, they can be a far more powerful long-term income tool than cash in the bank. But which ones could be buys?

Here are three ASX dividend shares that analysts think could be worth considering instead of a term deposit.

Charter Hall Retail REIT (ASX: CQR)

Charter Hall Retail REIT could be a strong option for investors seeking reliable income. The property trust owns a diversified portfolio of convenience-based retail centres anchored by supermarkets, service stations, and essential services.

These types of assets tend to be highly defensive, as shoppers continue to spend on groceries and everyday necessities regardless of economic conditions. Long lease terms and high-quality tenants provide visibility over rental income, which in turn supports consistent distributions to unitholders.

Citi rates its shares as a buy with a $4.50 price target. As for income, it is forecasting dividends per share of 25.5 cents in FY 2026 and then 26 cents in FY 2027. Based on its current share price of $4.10, this would mean dividend yields of 6.2% and 6.3%, respectively.

Elders Ltd (ASX: ELD)

Another ASX dividend share to look at is Elders. It could be good option for income investors that are comfortable with some cyclical exposure. The agribusiness provides rural and livestock services, agricultural inputs, and real estate services to Australia’s farming sector.

While its earnings can fluctuate with seasonal conditions, Elders has built a diversified national footprint that helps smooth performance across cycles. Strong agricultural demand and disciplined cost management have also supported solid cash generation in recent years.

Macquarie is a fan and has an outperform rating and $8.25 price target on its shares.

With respect to dividends, the broker is forecasting fully franked payouts of 36 cents per share in FY 2026 and then 37 cents per share in FY 2027. Based on its current share price of $6.97, this would mean dividend yields of 5.1% and 5.3%, respectively.

Harvey Norman Holdings Ltd (ASX: HVN)

Harvey Norman has long been a favourite among ASX income investors, and it isn’t hard to see why. The retailer benefits from a unique franchise model that generates robust cash flows and provides flexibility during challenging retail environments.

In addition to its core electronics and furniture operations, Harvey Norman owns a substantial property portfolio, which adds another layer of income stability. This combination of retail earnings and property exposure has supported generous dividend payments over time.

Bell Potter, which has a buy rating and $8.30 price target on its shares, expects fully franked dividends per share of 30.9 cents in FY 2026 and 35.3 cents in FY 2027. Based on its current share price of $6.92, this represents dividend yields of 4.5% and 5.1%, respectively.

The post Forget term deposits and buy these ASX dividend shares in 2026 appeared first on The Motley Fool Australia.

More reading

• Elders gets third strike in a row against its executive pay
• Two undervalued agriculture ASX shares to add to your Christmas stocking
• Bell Potter names three retail stock picks for your Christmas hamper
• These shares have bigger dividend yields (and more upside) than CBA shares
• What could keep Harvey Norman shares climbing in 2026?

Citigroup is an advertising partner of Motley Fool Money. Motley Fool contributor James Mickleboro 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 Charter Hall Retail REIT, Harvey Norman, and Macquarie Group. The Motley Fool Australia has recommended Elders. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

The Jumbo Interactive Ltd (ASX: JIN) share price will be in focus when the market opens today. This comes after the company released a contract-related update after Thursday’s close.

Shares in the online lottery ticket seller and platform provider finished the session at $10.93, up 1.02%, with investors yet to digest the news during normal trading hours.

Here are the key details.

What was announced?

According to the release, Lotterywest has awarded Brightstar Lottery PLC (NYSE: BRSL) a contract to deliver a new gaming and digital solutions platform.

Under the proposed structure, Brightstar will act as the prime contractor, with Jumbo working alongside it under a subcontract arrangement. Jumbo will supply key digital components, including its website and mobile application technology, as well as elements of its Player Account Management capability.

These features will be delivered through Jumbo’s proprietary Jumbo Lottery Platform (JLP), which already supports a range of government and charity lotteries globally.

Jumbo also noted that its existing SaaS agreement with Lotterywest, which supports the Lotterywest by Oz Lotteries digital channel, will continue as normal.

Why this matters for Jumbo investors?

Jumbo hasn’t put any figures around the update, and the proposed subcontract is still subject to negotiation and board approval.

That said, the announcement reinforces Jumbo’s position as a trusted digital partner in regulated lottery markets.

Brightstar is one of the world’s largest lottery operators, and Jumbo’s inclusion in a long-term government platform rollout highlights the strength of its digital offering. The platform transition is expected to be delivered in phases, with a targeted go-live in Q3 2027.

Jumbo said it will update the market once the subcontract terms are finalised.

Looking at the bigger picture

This update comes as Jumbo continues to progress on several parts of the business.

The company has been expanding internationally, particularly in the US, following its Dream Car Giveaways acquisitions. Jumbo has also continued to be viewed by brokers as a cash-generative, dividend-paying business, supported by recurring revenue from long-term lottery contracts.

Jumbo shares pulled back from recent highs earlier this year as the market focused on the cost of US expansion. Since then, the company has continued to add platform wins and partnerships that support its longer-term outlook.

What to watch next for Jumbo

In the near term, investors will be watching how the market responds today and whether any further detail emerges around the Brightstar subcontract.

Over time, the update adds another data point, showing Jumbo’s platform continues to be used in large, regulated lottery systems.

For now, I’ll be watching from the sidelines.

The post Why Jumbo shares could be one to watch today appeared first on The Motley Fool Australia.

More reading

• 5 things to watch on the ASX 200 on Friday
• These buy-rated ASX dividend shares offer 4% to 6% yields
• These top ASX dividend shares offer 5% to 10% yields
• Brokers name 3 ASX dividend shares to buy in December
• ASX gaming stocks: Should you try your luck?

Motley Fool contributor Aaron Teboneras 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 Jumbo Interactive. The Motley Fool Australia has recommended Jumbo Interactive. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

There’s nothing wrong with investing in an ASX focussed ETF or Australian companies. 

History tells us that the S&P/ASX 200 Index (ASX: XJO) returns an average of 9-10% per annum. 

That’s nothing to complain about. 

However, it’s important to understand that returns aren’t linear. Rather, it isn’t as simple as 9% every year. 

This year, statistically, has been a softer one for the ASX 200. 

At the time of writing, with a couple weeks left to go in the year, Australia’s benchmark index has risen roughly 4.7%. 

This is well below some other markets around the world. 

So for investors looking to diversify beyond the Australian market, here is how a hypothetical investment in some overseas markets would have performed in 2025. 

Betashares Capital Ltd – Asia Technology Tigers Etf (ASX: ASIA)

This ASX ETF aims to track the performance of an index (before fees and expenses) comprising the 50 largest technology and online retail stocks in Asia (ex-Japan). 

This includes global names like Samsung Electronics and Alibaba. 

It also offers heavy exposure to the growing semiconductor industry fuelling the AI boom.

It’s no surprise that exposure has helped this fund grow significantly in 2025. 

Since the start of the year, it is up 37.82%. 

That means a $10,000 investment at the start of the year would today be worth $13,782 today. 

Global X Euro Stoxx 50 ETF (ASX: ESTX)

As the name suggests, this ASX ETF invests in 50 of the largest companies across the eurozone.

This includes global blue-chips like Dutch multinational corporation and semiconductor company ASML Holding N.V. (ENXTAM: ASML) and German software company SAP (ETR: SAP). 

Some of the best performing markets in 2025 have been in Europe. 

By country, the fund has its largest weighting towards: 

• France 33.88%
• Germany 29.98%
• Netherlands 14.93%

This ASX ETF has risen 24.6%, which means an investment of $10,000 at the start of the year would already be worth $12,460. 

Betashares FTSE100 ETF (ASX: F100)

Just across the pond lives the London Stock Exchange. 

This ASX ETF tracks the performance of the FTSE 100 Index (before fees and expenses), which provides exposure to the largest 100 companies by market capitalisation traded on the London Stock Exchange.

This fund includes U.K based global leaders such as HBSC, Diageo and Unilever.

It has risen an impressive 21.10% this year. 

That would have brought an investment of $10,000 in January to a healthy $12,110 right now. 

The post Guess how much $10,000 invested a year ago in these global ASX ETFs is worth today appeared first on The Motley Fool Australia.

More reading

• The smartest ASX ETFs to buy and hold for 10 years
• The ASX ETFs to buy in 2026 and then never sell
• The smartest ASX ETFs for investors in their 20s and 30s
• The ultimate ASX ETF portfolio for beginners in 2026
• 5 ASX ETFs for beginner investors in 2026 and beyond

HSBC Holdings is an advertising partner of Motley Fool Money. Motley Fool contributor Aaron Bell has positions in Betashares Capital – Asia Technology Tigers Etf. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended ASML. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has recommended Alibaba Group, HSBC Holdings, and SAP. The Motley Fool Australia has recommended ASML. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

A new report from Macquarie has identified ASX mining stock St George Mining Ltd (ASX: SGQ) as one with plenty of upside. 

It is a mining exploration company. Its main focus is its Mt Alexander Project in Western Australia and The Araxá Project in Minas Gerais, Brazil. 

The company has evolved from a traditional nickel and copper explorer into a diversified critical mineral focused company post the acquisition of 100% of the Araxá Project in February 2025. 

This transaction has allowed the company to strategically repositioned itself to capture value from the global energy transition.

Macquarie’s report came after a visit to the Araxá project in Brazil. 

Here’s what the broker had to say. 

Resource upside

In Macquarie’s report, the broker said the visit to the Araxá project in Brazil highlighted recent drill success, further resource potential, and the advantages of a good location.

Macquarie believes Araxá is well-situated in an area endowed with existing infra and local mining /processing capabilities. It could become the next key niobium producer.

It highlighted that the company has reported multiple drilling updates with assay results highlighting thick niobium and rare earths interceptions from surface as part of its current 10,000-meter drilling program (due for completion in 1HCY26). 

Mineralisation remains open in all directions/at depth, with current drilling coverage representing less than 10% of the tenement area, presenting “significant upside potential for resource expansion.

Macquarie also said the drilling program could be extended.

Furthermore, Niobium processing is already well proven in the region, with CBMM (Brazilian mining company and the world’s largest producer of niobium) having produced niobium for around 50 years using standard techniques such as wet grinding, magnetic separation and flotation. 

The company has also recruited team members with experience in rare earths and niobium processing. Macquarie believes this should further reduce development risk.

Pilot plant update

In the report, Macquarie also highlighted that in October, the company announced a partnership with CEFET.

CEFET is a government-funded technology institute.

The two have plans to build a large-scale pilot plant. 

This pilot-first strategy should allow this ASX mining stock to apply for environmental and operating approvals on a smaller, lower-impact facility, potentially speeding up approvals and providing more flexibility when selecting an eventual mine site.

The smaller footprint may enable a fast-tracked application process/flexibility for early stage mine site selection.

Price target upside

Based on this guidance, Macquarie has an outperform rating on this ASX mining stock. 

It also has a price target of $0.20. 

This indicates an upside of approximately 122% from yesterday’s closing price of $0.09. 

The post Macquarie tips more than 120% upside for this ASX mining stock appeared first on The Motley Fool Australia.

More reading

• This soaring ASX mining stock backed by billionaire Gina Rinehart just unveiled “exceptional” news
• Up 400% in 2025! This Gina Rinehart-backed ASX rare earths stock just delivered some big news

Motley Fool contributor Aaron Bell 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 no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

On Thursday, the S&P/ASX 200 Index (ASX: XJO) fought hard and managed to record a very small gain. The benchmark index rose slightly to 8,588.2 points.

Will the market be able to build on this on Friday and end the week on a high? Here are five things to watch:

ASX 200 expected to rise again

The Australian share market looks set to rise on Friday following a strong night in the United States. According to the latest SPI futures, the ASX 200 is expected to open 48 points or 0.55% higher this morning. In late trade on Wall Street, the Dow Jones is up 0.15%, the S&P 500 is 0.75% higher, and the Nasdaq is storming 1.3% higher.

Oil prices rise

It could be a decent finish to the week for ASX 200 energy shares such as Santos Ltd (ASX: STO) and Woodside Energy Group Ltd (ASX: WDS) after oil prices rose overnight. According to Bloomberg, the WTI crude oil price is up 0.3% to US$56.12 a barrel and the Brent crude oil price is up 0.2% to US$59.81 a barrel. Traders were buying oil in response to mounting supply risks.

Dividend pay day

Today is a good day to own ANZ Group Holdings Ltd (ASX: ANZ) and Westpac Banking Corp (ASX: WBC) shares. That’s because both big four banks are scheduled to pay their latest dividends. ANZ is paying a partially franked 83 cents per share dividend, whereas Westpac is paying a fully franked 77 cents per share dividend to shareholders.

Gold price falls

ASX 200 gold shares such as Evolution Mining Ltd (ASX: EVN) and Northern Star Resources Ltd (ASX: NST) could have a subdued finish to the week after the gold price edged lower overnight. According to CNBC, the gold futures price is down 0.15% to US$4,366.7 an ounce. The precious metal eased after nearing a record high on rate cut optimism.

Jumbo update

Jumbo Interactive Ltd (ASX: JIN) shares will be on watch today after the online lottery ticket sellers made an announcement after the market close yesterday. It advised that Lotterywest has awarded a contract for the development, implementation, and support of a gaming solution and digital solution to replace its existing gaming and digital solutions platform to Brightstar Lottery (NYSE: BRSL) (Brightstar). However, Jumbo revealed that it will work with Brightstar on a subcontractor arrangement to provide components of the solution.

The post 5 things to watch on the ASX 200 on Friday appeared first on The Motley Fool Australia.

More reading

• Here are the top 10 ASX 200 shares today
• Why Boss Energy, Paragon Care, Treasury Wine, and Woodside shares are falling today
• Qube Holdings books $100m profit after selling Beveridge property
• Santos shares drop 24% from their peak. Is there any upside left?
• 5 ASX shares I’m avoiding this week

Computershare Ltd (ASX: CPU) shares have been on a roller-coaster this year. Once the darling of tech-focused financial stocks, the share price has gone from running red hot early this year to slipping into a steady decline towards fresh lows.

In the past 6 months Computershare shares have lost 16% of their value to $33.93 at the time of writing and they’re 21.5% down from their year-high in February.

In 2025 the Computershare stock dropped 0.06%. To put it in context, the S&P/ASX 200 Index (ASX:XJO) rose 3.4% in the past 12 months.

Now for the big question, is the sell-off a buying opportunity or a structural stumble?

Trillion-dollar ledger keeper

First let’s have a look at what the Melbourne based company does. At its core, Computershare is the behind-the-scenes backbone of the stock market. It manages share registries and related financial services for corporations around the world.

The $20 billion ASX company is essentially the global ledger keeper for trillions of dollars in financial assets, earning fees from corporate clients and transaction activity.

Computershare’s strengths are its scale, high switching costs, recurring fee base and wide moat in registry services. It’s the biggest player globally in what’s essentially a niche oligopoly.

Squeezed margins, fewer mergers

But it’s not without challenges. Computershare is heavily tied to the ebbs and flows of financial markets and interest rates, competitors and tech disruption.

Some analysts question how much further earnings can grow if margins are squeezed. Margin income is particularly vulnerable as rates ease, and slower merger and acquisitions activity can dampen high-margin transaction fees.

The flight of the shares

In most of 2025, Computershare shares looked like a classic compounder. The solid growth in recurring fee revenue, combined with share buybacks and a healthy dividend, propelled the stock higher.

But the market is telling a different story now with the Computershare shares in a steady decline. Some of this weakness reflects broader market headwinds.

Cautious sentiment crept into financial stocks as trading volumes in corporate actions softened and interest-rate uncertainty weighed on margin income.

What next for Computershare shares?

The broker community’s views are mixed. Some upgrades have crept in, highlighting reasonable FY26 guidance and resilient revenue drivers.

However, price targets have been trimmed or flagged as full, suggesting limited near-term upside. On the other hand, strong FY25 results and a solid balance sheet hint that the business fundamentals remain intact.

The most positive analyst forecast has set a maximum 12-month price target of $41.08, which points to a 21% upside. However, most brokers are more conservative with an average 10% gain and a price target of $37.36 for the next 52 weeks.

The post Are Computershare shares a buy after reaching new lows? appeared first on The Motley Fool Australia.

More reading

• $5,000 to invest? Consider 4 no-brainer ASX dividend shares with over 20 years of growth
• Here are the top 10 ASX 200 shares today

Motley Fool contributor Marc Van Dinther 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 no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

The Xero Ltd (ASX: XRO) share price has been one of the hardest-hit within the S&P/ASX 200 Index (ASX: XJO) in the last six months, with the ASX tech share down by 40% over that time. When a strong business falls that far, it could be a clear opportunity.

The cloud accounting provider may have continued to deliver subscriber, revenue, net profit and cash flow growth, but it hasn’t been enough to excite the market.

The broker UBS has looked over Xero shares and decided how much the business could deliver in returns over the next 12 months. Let’s take a look at what UBS is seeing and the potential growth the business could deliver.

Growth outlook intact

UBS says that it remains positive on the medium term growth outlook and believes the current Xero share price is trading at an “attractive buying opportunity”.

The broker notes that the core accounting business continues to see strong growth in the mid-to-high-teens, which is being driven by good growth of both subscribers and average revenue per user (ARPU). The ARPU is being driven by price increases and product mix.

For the next three years, UBS forecasts a compound annual growth rate (CAGR) of 22% for revenue and 37% for operating profit (EBITDA).

UBS believes that UK growth will be spurred by the third phase of ‘making tax digital’, while Australia could see “new use cases” that help growth. The broker believes ARPU growth will be supported by annual price rises along with higher product attachments (such as payments which grew 35% year-over-year).

What about the US?

The United States is a huge market if the company can get that right. Not too long ago, Xero acquired a US payments business called Melio.

UBS believes the market remains “cautious” on Melio as operating profit (EBITDA) losses were largely flat despite revenue growth of 68%, which was well ahead of expectations. The broker does believe there is a pathway to profitability by FY29 on an EBITDA basis, thanks to a CAGR for revenue of 53% partly due to an improving rate of subscriber additions.

The broker also thinks Melio could see growth in transaction revenue margins from 51 basis points (0.51%) to 58 basis points (0.58%) by FY28.

UBS then said:

We assume Melio achieves EBITDA breakeven by FY29e (prev FY30e), from an acceleration in top-line growth. We also remain conservative on potential upside from cross-sell between Melio and XRO. Management has communicated Melio Billpay will be available inside XRO from Dec-25 onwards along with Gusto payroll which is now in beta, which could drive potential upside to our conservative forecasts for avg +55k US Core accounting net adds over the next 3 years.

Xero share price target

UBS currently has a price target of $194 on the business. That implies a possible rise of just over 70%, if the broker ends up being right.

The post Why experts think the Xero share price could rise 70% in 2026! appeared first on The Motley Fool Australia.

More reading

• 3 unstoppable ASX shares to buy with $3,000
• Here are the top 10 ASX 200 shares today
• 2 ASX 200 shares that could be top buys for growth
• These world class ASX 200 growth shares could rise 40% to 80%
• What on earth is going on with Xero shares?

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 positions in and has recommended Xero. The Motley Fool Australia has positions in and has recommended Xero. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

There is a group of wonderful ASX shares that have been among the best performers on the Australian stock market over the past decade.

However, the last few months have been painful for the share prices of many of these businesses. I think this is presenting a great opportunity to buy shares at a much lower price/earnings (P/E) ratio.

While these leading ASX growth shares still don’t trade on an earnings multiple similar to Commonwealth Bank of Australia (ASX: CBA) after the declines, the businesses below have a lot more earnings potential and they continue to grow profit. I’d happily buy them with $3,000.

Pro Medicus Ltd (ASX: PME)

This business is arguably the best company on the ASX. It describes itself as a global provider of medical imaging solutions, including radiology imaging solutions (RIS) and picture archiving and communication systems (PACS).

The FY25 result was a perfect example of the businesses’ impressive financials. Revenue rose 31.9% to $213 million, net profit after tax (NPAT) jumped 39.2% to $115.2 million and the final dividend per share was hiked by 37.5% to 30 cents per share.

A key enabler of the company’s strong financials is an underlying operating profit (EBIT) margin of 74%, which is exceptionally high. This helps turn a sizeable majority of new revenue into operating profit.

The ASX share is winning new contracts with major customers in the northern hemisphere and it’s also successfully selling additional modules to existing customers.

With the Pro Medicus share price down 35% since July, it looks like a good time to invest for the long-term. According to the forecast on Commsec, it’s now trading at 85x FY28’s estimated earnings.

TechnologyOne Ltd (ASX: TNE)

TechnologyOne is an ASX share I’ve put some of my own investing money into recently.

The company provides enterprise resource planning (ERP) software, with customers like local, state and federal government, companies, universities and other organisations.

This business is delivering consistent growth year after year. In FY25, the business delivered profit before tax (PBT) growth of 19% to $181.5 million, beating guidance of between 13% to 17%.

TechnologyOne has been successful at providing subscribers with software improvements, unlocking more revenue from them over the years. It’s also winning new customers from competitors, such as the London boroughs of Islington London Borough Council and the Council of the Royal Borough of Greenwich. This is helping drive revenue.

The business reached annual recurring revenue (ARR) of $554.6 million in FY25 and it has a goal to reach $1 billion of ARR by FY30, which would help it become significantly more profitable.

According to the forecast on Commsec, the TechnologyOne share price is now valued at 39x FY28’s estimated earnings. That’s after a decline of 34% in the past six months.

Xero Ltd (ASX: XRO)

Xero is the leading cloud accounting provider in Australia and New Zealand. It also has built an impressive market share in markets like the UK, Singapore and South Africa.

The company now has 4.5 million subscribers from across the world, which has given the company significant scale advantages. With its gross profit margin of almost 90%, new revenue is rapidly boosting the ASX share’s profit statistics.

In the first half of FY26, net profit surged 42% to NZ$135.8 million and free cash flow jumped 54% to NZ$321 million.

The Xero share price is down 43% in the past six months, which I think has been overdone. Tax reporting and digitalisation gives Xero pleasing earnings tailwinds for the years ahead.

According to the forecast from UBS, the Xero share price is now valued at just 37x FY28’s estimated earnings following the heavy decline this year.

The post 3 unstoppable ASX shares to buy with $3,000 appeared first on The Motley Fool Australia.

More reading

• Why experts think the Xero share price could rise 70% in 2026!
• Here are the top 10 ASX 200 shares today
• Bell Potter names the best ASX healthcare shares to buy in 2026
• 2 ASX 200 shares that could be top buys for growth
• Experts rate these 2 ASX growth shares as buys this month!

Motley Fool contributor Tristan Harrison has positions in Pro Medicus and Technology One. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Technology One and Xero. 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 Xero. The Motley Fool Australia has recommended Pro Medicus and Technology One. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

The “Magnificent Seven” is the name given to the group of Nvidia, Apple, Microsoft, Alphabet, Meta, Tesla, and Amazon (NASDAQ: AMZN). These seven companies are bundled together because they have driven much of the stock market’s gains in recent years. As of Dec. 15, they are seven of the world’s top nine most valuable companies and represent nearly 35% of the S&P 500.

So far this year, every “Magnificent Seven” stock has produced double-digit returns except for one: Amazon.

Once the face of growth stocks, Amazon has lagged over the past year, frustrating its investors along the way. Despite that retreat, Amazon may be positioned to bounce back in 2026.

^SPX data by YCharts.

Why has Amazon’s stock been lagging?

There hasn’t been one issue that’s caused Amazon’s underperformance. It’s more a combination of factors. First, Amazon has spent a lot of money this year, with capital expenditures (capex) of around $90 billion through the first nine months of 2025.

Given how much Amazon has been spending (mostly on AI infrastructure), investors have been wanting more to show for it — especially when it comes to Amazon Web Services (AWS) growth. With many of the “Magnificent Seven” stocks making big splashes in AI, some people viewed Amazon as falling behind in the race.

AMZN Capital Expenditures (Quarterly) data by YCharts.

Amazon’s heavy spending has weighed on its free cash flow, and that’s not something investors typically like without seeing more immediate results. Add in how expensive Amazon’s stock has been, and there was little room for error in many investors’ eyes.

AWS is positioning itself for the future

AWS may not have been producing the results that we’ve grown used to seeing over the years, but investors jumping ship seems like a premature overreaction (which is no surprise if you know investors). Yes, AWS has been losing market share to Microsoft’s Azure and Alphabet’s Google Cloud, but it’s still the world’s largest cloud platform by far.

Cloud platforms are, and will continue to be, crucial to AI training and scaling. That’s why Amazon has been focusing so much on building out more infrastructure and adding computing capacity. It has added more than 3.8 gigawatts in the past 12 months and plans to double its capacity through 2027.

This investment is noteworthy because, according to calculations from investment bank Oppenheimer, each incremental gigawatt of capacity could add $3 billion in revenue. The high capex might be weighing on Amazon’s financials right now, but it’s poised to pay off in the long term.

Amazon has an underrated profit machine

There’s no doubt that AWS is Amazon’s profit engine, accounting for most of its operating income. However, advertising is a high-margin business that has been growing steadily over the past couple of years.

On one hand, Amazon has access to data from its millions of customers and Prime members, making it more effective at helping advertisers with targeted ad campaigns. They know what customers buy, when they buy it, what they watch, what they listen to, what they browse, and other information that allows advertisers to target with greater precision. 

On the other hand, Amazon’s massive reach means it has plenty of places to set these ads. Whether it’s online, when you search for a specific product, stream something on Prime Video, watch Twitch, or listen to music, there’s no shortage of real estate for advertisers looking to reach potential customers. Amazon also announced that it recently struck partnerships that allow its advertisers to buy ad space on Netflix, Spotify, and SiriusXM.

In the third quarter, Amazon’s advertising services revenue grew 24% to $17.7 billion, outpacing its revenue from subscriptions ($12.5 billion). Beyond revenue growth, advertising is a high-margin business that can help Amazon boost its overall profitability. I expect the momentum to continue in 2026.

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

The post My surprising top “Magnificent Seven” stock pick for 2026 appeared first on The Motley Fool Australia.

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

More reading

• The 3 smartest quantum computing stocks to buy with $1,000 in 2026
• My surprising top “Magnificent Seven” stock pick for 2026
• Is Amazon (AMZN) a Buy, Sell, or Hold in 2026?
• Amazon is expanding its AI chip ambitions. Should Nvidia investors be worried?
• Amazon just made a major AI announcement. Here’s what it means for investors.

Stefon Walters has positions in Apple and Microsoft. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Alphabet, Amazon, Apple, Meta Platforms, Microsoft, Netflix, Nvidia, Spotify Technology, and Tesla. 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 recommended Alphabet, Amazon, Apple, Meta Platforms, Microsoft, Netflix, and Nvidia. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.