All eyes will be on Commonwealth Bank of Australia (ASX: CBA) shares when it reports its half-year result later this month.

That is because CommBank is the only one of the big four banks due to report an interim result this month, which means its numbers are likely to shape sentiment across the entire banking sector during reporting season.

According to investment firm Wilsons, the upcoming result is expected to confirm that underlying sector fundamentals remain in good shape, even if it does little to change the valuation debate surrounding CBA’s shares.

Sector fundamentals still look sound

Wilsons expects Commonwealth Bank’s result to reinforce that conditions across the banking sector remain relatively healthy. It said:

We expect the result to confirm that sector fundamentals remain sound, with continued solid credit growth, robust capital buffers and benign bad debt trends.

In other words, there is no expectation of stress emerging in the loan book or balance sheet. From a risk perspective, the bank appears well positioned.

The upgrade question looms large

The investment company notes that a key disappointment for some investors was that CBA failed to deliver an upgrade at its FY 2025 full-year result.

As a result, bullish investors will now be looking for signs that the bank can re-enter an upgrade cycle this reporting season. However, the broker is sceptical that this will happen. It adds:

After CBA failed to deliver an upgrade at its FY25 full year result, CBA bulls will be looking for a resumption of the bank’s upgrade cycle this reporting season. A key focus specifically will be on costs, after CBA’s OPEX was worse than expected in FY25 due to greater tech spend, rising staff costs and workforce mix changes.

Valuation remains a key issue

While Wilsons expects the result to confirm solid fundamentals, it does not see meaningful upside to consensus earnings estimates.

If CBA falls short, or merely meets consensus, the broker believes the rotation out of the stock is likely to continue. That is largely due to valuation. It explains:

[W]e don’t see meaningful upside to consensus EPS estimates. If CBA’s result meets or falls short of consensus, as we expect, the rotation out of the stock is likely to continue. In that scenario, bank sector performance should continue to broaden, given CBA remains on a material valuation premium to the sector (at a ~40% P/E premium to peers). This is despite CBA offering only comparable (~3-4%) EPS growth to peers in FY26, while being the only bank not currently in an earnings upgrade cycle.

The post What to expect from the Commonwealth Bank half-year result appeared first on The Motley Fool Australia.

More reading

• ASX bank shares: One I’d buy and one I’d avoid
• The best Australian dividend stocks to buy and hold forever
• Don’t buy CBA shares until this happens
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• 3 ASX dividend stocks I’m excited to see the payouts of this reporting season

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 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 S&P/ASX 200 Index (ASX: XJO) is having a subdued session on Thursday. In afternoon trade, the benchmark index is down 0.5% to 8,882.3 points.

Four ASX shares that are falling more than most today are listed below. Here’s why they are dropping:

Beach Energy Ltd (ASX: BPT)

The Beach Energy share price is down over 4% to $1.20. This follows the release of the energy producer’s half-year results. Beach Energy reported a 1% decline in sales revenue to $981.7 million and a 32% drop in net profit after tax to $150.2 million. This reflects a combination of production declines and weaker oil and liquids prices. Beach Energy’s CEO, Brett Woods, spoke positively about the second half. He said: “Our steady financial footing and safe operational performance through a challenging half positions Beach for an active second half, particularly as Waitsia ramps up and offshore campaigns progress.”

Elders Ltd (ASX: ELD)

The Elders share price is down 4% to $7.04. Investors have been selling this agribusiness company’s shares after it announced a change of leadership. Elders has named Rene Dedoncker as its new CEO, commencing 1 October 2026. He will be replacing long-serving CEO, Mark Allison. Elders’ chair, Glenn Davis, said: “We are delighted to welcome Rene as our next CEO. He brings deep agricultural roots and outstanding leadership experience to Elders. He has proven expertise from his years with Fonterra and Mars, where he drove operational excellence and strategic growth on a global scale. The Board has great confidence in his ability to lead Elders into its next phase of success.”

Maas Group Holdings Ltd (ASX: MGH)

The Maas Group share price is down 23% to $4.30. This has been driven by news that the construction materials, equipment and service provider is selling its construction business for $1.7 billion. The company believes the deal will help fund a strategic shift into digital assets. It said: “Just as the Group positioned itself early into renewables-related infrastructure, MGH is now positioning to participate in the next wave of infrastructure investment, combining digital, AI, and electrification opportunities. The Australian data-centre and electrification markets present scalable, high-value opportunities aligned with MGH’s execution DNA, integrated capabilities, and program-based delivery.”

Neuren Pharmaceuticals Ltd (ASX: NEU)

The Neuren share price is down 10% to $13.19. This follows the release of an update on its NNZ-2591 product candidate. While the US FDA has given Neuren a pathway forward for advancing NNZ-2591 in two rare neurological conditions, some additional work will be required. This could mean it takes longer than expected for approval.

The post Why Beach Energy, Elders, Maas, and Neuren shares are dropping today appeared first on The Motley Fool Australia.

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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 no position in any of the stocks mentioned. 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 holy grail of mining investing is to find an early-stage company with good prospects and, hopefully, hang on to the shares as they mature into a fully-fledged miner.

There are no certainties in this regard, but the team over at Shaw and Partners have had a look at Sunstone Metals Ltd (ASX: STM) and has taken a shine to them after a positive announcement this week.

What was announced this week?

So the news this week included trenching results from the company’s most recent exploration efforts, which delivered some positive findings.

These included 29.5m at 0.91 gram per tonne of gold equivalent (made up of gold, copper, and molybdenum) and 21.6m at 1.19 grams per tonne of gold equivalent.

The company said in its statement to the ASX that the high grade mineralisation at the surface “highlights the huge scope to grow the 3.6Moz AuEq Mineral Resource at its Bramaderos Project in southern Ecuador”.

The company’s Managing Director, Patrick Duffy, added:

These results demonstrate yet again the huge potential to grow what is already a big gold-copper resource at Bramaderos. “The latest results come from the first three trenches across part of the large Porotillo soil gold-copper anomaly, which lies south of the recent Copete discovery. They contain extremely strong, consistent gold and copper mineralisation and significantly strengthen our targeting model ahead of imminent drilling at Copete, Porotillo, and Melonal.

Mr Duffy said the company had recently increased the resource base by a third to 3.6 million ounces and said, “Sunstone is well-placed to fast-track further expansion of the resource in 2026”.

He added that a scoping study was also well underway, “which we are very confident will demonstrate outstanding economics of this growing cluster of outcropping gold-copper porphyry systems on the Bramaderos project”.

The Shaw and Partners team examined this week’s announcement and said the trenching method of exploration was a cost-effective way to refine targets for the company’s upcoming drilling program.

They also put the region into context:

Bramaderos is in elephant country, with a vast exploration target of an additional 5-13 million ouncs. The immediate strategy focuses on drilling to convert targets to formal resources, aiming to reach 5 million ounces by the end of the year. By integrating the high-grade Limon epithermal system into the broader mine plan, Sunstone aims to enhance early-year project economics through higher-grade feed, reinforcing Bramaderos as a globally significant asset with long-life, low-cost potential.

Shaw and Partners added that Sunstone is continuing to engage with strategic partners to potentially accelerate its projects.

The broker has a price target of 7 cents per share, which would represent a 311.8% return from the current level of 1.7 cents if achieved.

Sunstone was valued at $115.6 million at the close of trade on Wednesday.

The post Looking to get in on the ground floor of an early stage gold stock? This one might be worth a look appeared first on The Motley Fool Australia.

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Motley Fool contributor Cameron England 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.

Thematic ASX exchange-traded funds (ETFs) enable investors to participate in investment themes with long-term tailwinds.

One of them is the global green energy transition.

This investment theme is being clearly seen in the commodities markets, where prices for future-facing metals have soared.

Here are 2 ASX ETFs capitalising on this thematic.

Betashares Energy Transition Metals ETF (ASX: XMET)

XMET ETF is $16.83 per unit, down 0.7% on Thursday but up a staggering 114% over the past 12 months.

This ASX ETF invests in 30 metal producers that are powering the global clean energy transition.

XMET tracks the Nasdaq Sprott Energy Transition Materials Select Index.

It provides exposure to global producers of copper, lithium, nickel, cobalt, graphite, manganese, silver, and rare earths elements.

Many of these metals show up in our article on the 12 best-performing commodities of 2025.

Betashares explains the ETF’s thesis:

The transition from fossil fuels to clean energy solutions is driving growth in a range of disruptive products and processes such as renewable energy generation, battery storage solutions, and electric vehicles, all of which are critically dependent on the select group of ETMs [Energy Transition Metals] that XMET provides exposure to.

Holdings include international shares like First Majestic Silver Corp and Ivanhoe Mines.

There are also Aussie shares like ASX lithium pure-play PLS Group (ASX: PLS) and Lynas Rare Earths Ltd (ASX: LYC).

Just under a third of holdings are in Canada, and nearly 18% are in Australia.

XMET has net assets of $122 million, and the management fee is 0.69%.

Betashares investment strategist, Tom Wickenden, said only two of XMET’s 30 stocks recorded negative returns in 2025 and nine of them more than doubled in value.

Global X Green Metal Miners ETF (ASX: GMTL)

GMTL ETF is $14.63 per unit, down 2.2% today and up 94% over the past year.

Global X says this ETF is capitalising on surging demand for green metals and impending global supply crunches for those metals.

GMTL tracks the Bita Global Green Energy Metals Index.

It provides diversified exposure to the global materials and industrials sectors with strategic allocations to green metals such as lithium, copper, nickel, and cobalt.

Among the 49 holdings is Canadian miner, First Quantum Minerals, and US lithium processor, Albemarle Corp.

Aussie names include South32 Ltd (ASX: S32), Lynas Rare Earths, PLS Group, and copper miner, Sandfire Resources Ltd (ASX: SFR).

About a third of holdings are listed in China.

GMTL has net assets of $13 million, and the management fee is 0.69%.

The post 2 ASX ETFs leveraging the green energy transition appeared first on The Motley Fool Australia.

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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 recommended Lynas Rare Earths Ltd. 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 S&P/ASX 200 Index (ASX: XJO) is down 0.2% in early afternoon trade on Thursday, with these three ASX 200 shares not helping matters as they sink to new one-year plus lows.

Now, if you’re on the hunt for bargain priced ASX stocks, take note.

While new multi-year lows can represent a potentially strategic long-term entry point, there’s no guarantee that these stocks won’t continue to slide.

So, before you hit that buy button, do some thorough research – or reach out for professional advice – to minimise the odds you’re trying to catch the proverbial falling knife.

With that said…

ASX 200 shares slumping to one-year plus lows

The first large-cap company hitting new one-year plus lows today is WiseTech Global Ltd (ASX: WTC).

Shares in the global logistics software solutions company are down 0.9% at time of writing, trading for $50.80 each. That’s the lowest levels for this ASX 200 share since January 2023.

WiseTech shares have plunged 13.9% over the past five days. With no fresh news out from the company that’s likely to spook investors, the selling pressure looks to be related to the broader AI fuelled sell-off in global software stocks.

With AI capabilities continuing to advance at breakneck, investors fear that the technology could soon disrupt the business models of most software focused stocks.

Moving on to the second ASX 200 share pluming new one-year plus lows today, real estate investment trust (REIT) Dexus (ASX: DXS).

Dexus shares have recovered from steeper losses posted earlier today but remain down 0.1% at time of writing, trading for $6.58 each.

That’s the lowest share price since June 2024.

There’s also no recent fresh news out from Dexus. But investors could be eyeing the ongoing, and growing, weakness in Australia’s office vacancies. Dexus has a large holding of quality office properties.

The prospect of ongoing elevated interest rates also isn’t going to offer any help to rate sensitive stocks like REITs.

Which brings us to…

Also plumbing one-year plus lows today

The third ASX 200 share sliding to one-year plus lows today is Guzman Y Gomez (ASX: GYG).

Shares in the Mexican fast food restaurant chain are down 2.0% in early afternoon trade on Thursday, changing hands for $20.27 apiece.

That’s the lowest level ever for Guzman Y Gomez shares, which first began trading on the ASX on 20 June 2024.

Guzman Y Gomez shares have plunged 48.5% over the past 12 months.

While painful for faithful stockholders, the ongoing slide will be welcomed by the raft of short sellers betting against the stock.

The ASX 200 share kicked off this week with a short interest of 13.7%.

The post Bargain hunting? Here are 3 ASX 200 shares plumbing 52-week lows today appeared first on The Motley Fool Australia.

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

Lotus Resources Ltd (ASX: LOT) shares are in a trading halt on Thursday after the company requested a pre-market pause.

The halt will remain in place pending the release of a further announcement to the market, or until the start of trade on Monday, 9 February.

Lotus shares last traded at $2.88 on Wednesday before the halt. The stock is now up around 43% for the year amid improving sentiment across the uranium sector.

According to the ASX notice, the trading pause was requested while the company finalises and releases additional information.

What investors know so far

While the initial ASX trading halt notice contained limited detail, Lotus has since released further information. That update outlines a funding initiative linked to the ramp-up at its Kayelekera uranium operation in Malawi.

The company said it has launched a non-underwritten institutional placement to raise approximately $76 million, alongside plans for a Share Purchase Plan (SPP) of up to $5 million.

The funding is intended to provide added balance sheet flexibility as the company transitions toward steady state production.

New shares under the placement are priced at $2.15 each, representing a discount to the last closing price, and will rank equally with existing ordinary shares.

Why Lotus is raising now

Lotus holds an 85% interest in the Kayelekera uranium project, a former producer that restarted operations in August 2025.

The company is targeting production of around 200,000 pounds of U3O8 per month in Q2 CY2026, equivalent to approximately 2.4 million pounds per annum.

First shipment of uranium concentrate is expected during Q2, with first cash receipts targeted for Q3 CY2026.

Product qualification is progressing, with preliminary confirmation already received from one western converter. Final product acceptance is expected during February, which is a key step toward commencing regular exports.

Management said the funding will help support working capital needs, inventory build, and remaining commissioning activities, including completion of the acid plant and grid connection.

Favourable long-term sector tailwinds remain

The announcement comes amid strong long-term demand expectations for uranium.

Governments globally continue to back nuclear power as part of broader decarbonisation and energy security strategies.

Many countries are extending the life of existing reactors, approving new builds, and committing to higher nuclear capacity targets over the coming decades. This shift has tightened long-term supply expectations and supported uranium prices.

What investors will watch next

Investors will now be watching closely for the lifting of the trading halt. Attention will then turn to placement completion and any further operational updates from Kayelekera.

With funding visibility improving, execution over the coming months is likely to be the key driver of shareholder returns.

The post Why this ASX uranium miner’s shares are frozen today appeared first on The Motley Fool Australia.

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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 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.

In afternoon trade, the S&P/ASX 200 Index (ASX: XJO) is on course to record a decline. The benchmark index is down 0.3% to 8,901.5 points.

Four ASX shares that are not letting that hold them back are listed below. Here’s why they are rising:

Amcor (ASX: AMC)

The Amcor share price is up 6% to $69.30. This morning, analysts at Morgans responded positively to the packaging giant’s quarterly update. It has retained its buy rating with a slightly trimmed price target of $75.80. It said: “Following the renegotiation of several customer contracts on better terms, segment performance should improve in 2H26. AMC also noted that discussions around portfolio optimisation are progressing well, and we view any future announcement in this area as a potential positive catalyst for the stock.”

Lovisa Holdings Ltd (ASX: LOV)

The Lovisa share price is up 4.5% to $32.19. This may have been driven by a broker note out of Citi. According to the note, the broker has retained its buy rating and $38.45 price target on this fashion jewellery retailer’s shares. Citi expects Lovisa to deliver sales growth ahead of consensus estimates during the first half of FY 2026.

Regal Partners Ltd (ASX: RPL)

The Regal Partners share price is up 5% to $3.06. Investors have been buying the fund manager’s shares after it announced an on-market buyback program of up to $75 million. It stated: “The decision to implement a buy-back program reflects the strength of the RPL balance sheet and the continued delivery of operating cash flows and demonstrates the Board’s and management’s confidence in RPL’s outlook for continued profitable growth. The Board believes that a buy-back program is appropriate as part of its overall capital management strategy and remains focused on maximising shareholder returns, whilst preserving balance sheet strength and ensuring that RPL maintains the ability to pursue strategic growth opportunities.”

SKS Technologies Group Ltd (ASX: SKS)

The SKS Technologies share price is up over 10% to $3.90. This morning, this electrical technologies and digital infrastructure specialist announced two big contract wins. This has led to SKS upgrading its revenue guidance to $340 million (from $320 million) and net profit before tax guidance to $34 million (from $28.8 million). The company’s CEO, Matthew Jinks, commented: “The revised outlook is based on a combination of new contract awards, a further record level of $325 million of work on hand, and a realistic confidence in future conversions from pipeline to contract award.”

The post Why Amcor, Lovisa, Regal Partners, and SKS shares are pushing higher today appeared first on The Motley Fool Australia.

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

CSL Ltd (ASX: CSL) shares are marching higher today.

Shares in the S&P/ASX 200 Index (ASX: XJO) biotech stock closed yesterday trading for $181.70. As we head into the Thursday lunch hour, shares are changing hands for $182.97 apiece, up 0.7%.

For some context, the ASX 200 is down 0.2% at this same time.

Today’s outperformance will come as welcome news to longer-term shareholders, who’ve watched the stock plunge 32.3% over the past 12 months. Losses which will have only been modestly softened by the two unfranked dividends the company paid out over this time, totalling $4.522 a share.

At the current share price, CSL shares trade on an unfranked trailing dividend yield of 2.5%.

2026, however, is shaping up better for the biotech giant.

After closing at multi-year lows on 6 January, CSL stock has gained 7.2%.

We’ll look at why Morgans’ Damien Nguyen believes CSL can keep outperforming in 2026 below.

But first…

Why did the ASX 200 biotech stock get slammed in 2025?

Looking back on 2025, we can point to two days that caused most of the carnage for stockholders.

First, on 19 August, CSL shares closed down a sharp 16.9% following the release of the company’s FY 2025 results.

While a lot of the financial metrics were strong, ASX investors were decidedly less than happy with management’s announcement of plans to spin off CSL’s Seqirus segment – one of the world’s largest influenza vaccine businesses – into a separate ASX-listed company.

That plan was later paused as CSL waits for unfavourable conditions in the United States influenza vaccine market to improve before moving forward with the demerger.

The next major hit came on 28 October. CSL shares crashed 15.9% on the day after management reduced the company’s full-year FY 2026 guidance.

On 19 August, CSL had forecast that it would achieve full-year revenue growth (in constant currency) in the range of 4% to 5%. And guidance for net profit after tax before amortisation (NPATA) and excluding non-recurring restructuring costs was forecast to increase between 7% to 10%.

CSL’s new full-year revenue growth guidance (in constant currency) was revealed to be in the range of 2% to 3%, down from the prior guidance of 4% to 5%.

FY 2026 guidance for growth in net profit after tax before amortisation (NPATA) and excluding non-recurring restructuring costs was cut to 4% to 7%, down from the prior range of 7% to 10%.

Why now could be an opportune time to buy CSL shares

With the ASX 200 biotech stock down 32.6% since 18 August, Morgans’ Nguyen believes now could be an opportune time to snap up some shares (courtesy of The Bull).

“This biopharmaceutical giant offers a stronger risk/reward profile after a period of share price underperformance,” Nguyen said, citing the first reason you might want to buy CSL shares today.

“Plasma collections are rising, costs are normalising and earnings momentum is improving,” he added.

As for the third reason the ASX 200 stock could be set for a sustained rebound in 2026, Nguyen said, “Recovery at CSL Behring, a blood products division, remains on track and the influenza vaccination division Seqirus continues to provide defensive earnings.”

Nguyen concluded:

The current valuation sits well below long term averages despite fundamental improvement. This sets up an attractive long term capital growth story. Catalysts for a share price re-rating include an earnings recovery and margin expansion.

The post 3 reasons to buy CSL shares today appeared first on The Motley Fool Australia.

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Motley Fool contributor Bernd Struben 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. The Motley Fool Australia has recommended CSL. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

Despite trading conditions Retail Food Group Ltd (ASX: RFG) has described as “challenging”, at least one broker says there are serious gains to be made in buying the company’s shares.

Retail Food Group earlier this week put out a statement to the ASX updating the market on its debt refinancing and its expected first-half results.

The company said it had refinanced its debt with a new $41.2 million facility with Washington H. Soul Pattinson & Company Limited (ASX: SOL), with the new facility providing another $7.5 million of headroom to finance its growth plans. The new debt was at an interest rate of 9%.

Difficult start to the year

The company also said that it expected the first half underlying EBITDA to come in at $9 to $10 million, down from $16 million for the first half in the previous year.

This was due to challenging trading conditions during the second quarter, a lack of certain one-offs that would not be repeated during this period, and a lower-than-anticipated contribution from newer Beefy’s outlets.

The company added:

Earnings were also impacted by franchisee support initiatives relating to the above, including maintenance of wholesale coffee prices despite higher raw material costs, particularly green coffee beans.

Retail Food Group also explored a potential sale of the Brumby’s Bakery business during the half, but decided to retain the business.

Executive Chairman Peter George said:

While Brumby’s attracted considerable interest from multiple parties, we were ultimately not convinced that the options available would be in the best interests of shareholders, franchisees, or team members at this time. Brumby’s remains profitable and is an important contributor to RFG’s performance, with this decision providing certainty for all brand stakeholders.

In the earnings guidance, the company said cost initiatives were under, which were expected to deliver $1.2 to $1.8 million in savings this financial year and increase to $5 to $7 million during FY27.

The company added:

As a result of the above, RFG expects earnings to improve in 2H26 vs 1H26 and is guiding to FY26 Underlying EBITDA of $20.0-24.0m.  

Analysts see plenty of upside

The Shaw team, in a research note to clients, said the company’s valuation going forward was likely to be driven by how well it executes its growth tactics, both organically and via new store openings.

They added:

RFG has identified initiatives that can grow the business organically such as, implementation of new systems, conversion of legacy branded outlets into focus branded outlets, engagement of multi-site operators and expansion of company-owned stores. RFG management has indicated that it can leverage its systems, knowledge, network and overheads to bolt-on acquisition of branded food/beverage outlets. Value-accretive acquisitions could be a key valuation driver for RFG.

Shaw and Partners has a price target of $2 on the shares compared with $1.28 currently. If achieved, this would deliver a 57% return to shareholders.

Retail Food Group was valued at $80.2 million at the close of trade on Wednesday.

The post Looking for better than 50% upside? This fast-food company could be worth a look appeared first on The Motley Fool Australia.

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Motley Fool contributor Cameron England has positions in Washington H. Soul Pattinson and Company Limited. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Washington H. Soul Pattinson and Company Limited. The Motley Fool Australia has positions in and has recommended Washington H. Soul Pattinson and Company Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

ASX bank shares have had a slow start to the year, with investor sentiment weighing heavily on share prices, especially for the majors.

This week’s interest rate hike and concerns that inflation is spiralling again have created more headwinds for the sector. The spotlight is well and truly on where ASX bank shares will go from here.

But some parts of the sector have a far rosier outlook than others. Here’s one ASX bank stock I’d buy right now, and one I’d avoid.

I’d buy Judo Capital Holdings Ltd (ASX: JDO) shares

Judo is an Australian bank built to provide financial services and lending to small and medium-sized businesses (SMEs) with a turnover under $100 million.

The bank was founded in 2016, received its banking license in 2019 and was listed on the ASX in 2021. So it’s new in comparison to the Aussie majors. 

What I like about Judo is that it sits apart from the rest of the banks in the sector. Unlike the big four, Judo is purely focused on SMEs, doing so through relationship-based banking rather than mass mortgages or consumer loans.

This business model means that the bank is more sensitive to economic changes, but it also means it has a higher growth potential because it has good customer engagement and, therefore, business momentum.

In its latest results for the first half of FY26, the bank reported strong loan growth and confirmed it was on track to meet its gross loans and advances (GLA) guidance of $14.2 to $14.7 billion in 2026. Judo also plans to boost its profit before tax to $190 million. 

At the time of writing on Thursday morning, the bank’s shares are down 0.53% to $1.89 a piece. That represents a 5% increase for the year to date. 

I’d avoid Commonwealth Bank of Australia (ASX: CBA) shares

I’m concerned that CBA shares are still well above fair value and that they could be due for a price correction this year. In fact, I think they could crash below $100 in 2026. 

CBA’s price-to-earnings (P/E) ratio at the time of writing is 24.86, which is much higher (and therefore more expensive) than most other banks’.

The banking giant is also facing ongoing margin pressure from intense market competition in lending and deposit products. And the latest interest rate hike could pile even more pressure on the business to perform.

In the short term, an interest rate hike means more earnings for CBA. But in the medium to long term, it can lead to stronger competition and even an increase in mortgage stress. As CBA is heavily exposed to mortgage lending, this could put huge pressure on its share price.

At the time of writing on Thursday morning, CBA shares are 0.5% higher at $153.85. For the year to date, they’ve dropped 2.01%. 

The post ASX bank shares: One I’d buy and one I’d avoid appeared first on The Motley Fool Australia.

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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 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.