ASX healthcare stocks were among the worst performing over the last year. 

In fact, the S&P/ASX 200 Health Care (ASX:XHJ) index is down more than 24% over the last 12 months. 

For context, the S&P/ASX 200 Index (ASX: XJO) is up 7.5% in that same span. 

One of the many healthcare stocks have stumbled in the last year is EBR Systems Inc. (ASX: EBR). 

Its share price has fallen by 20% in that time.

However it has drawn an attractive buy recommendation and valuation from the team at Morgans. 

Let’s find out what’s behind the positive outlook. 

Introducing EBR Systems

EBR Systems is a medical technology company that develops innovative, implantable cardiac pacing devices designed to treat cardiac rhythm diseases, especially heart failure.

Its’ key technology is the Wireless Stimulation Endocardially (WiSE) technology, which was developed to eliminate the need for cardiac pacing leads.

Back in December, the company made headlines due to successfully implanting the first patient in a key clinical trial.

The company behind this healthcare stock said:

The initial product is designed to eliminate the need for coronary sinus leads to stimulate the left ventricle in heart failure patients requiring Cardiac Resynchronisation Therapy (CRT). Future products potentially address wireless endocardial stimulation for bradycardia and other non-cardiac indications.

Commercial and Clinical Progress

In its Q4 announcement released on Monday, the company said the WiSE System was implanted in 18 commercial patients during Q4 2025, doubling the number performed in Q3 2025.

The company also said it expects to report revenue in the range of US$870K and US$935K for Q4 2025, and total 2025 revenue in the range of US$1,552K and $1,617K, based on preliminary unaudited year-end results and subject to yearend closing adjustments. 

John McCutcheon, EBR Systems’ President & Chief Executive Officer said:

In Q4 2025, we continued to make solid progress across both our commercial and clinical programs. Case volumes increased meaningfully, reflecting growing physician experience and expanding site readiness. Additionally, we advanced important clinical initiatives, including the commencement of the WiSE-UP post-approval study and the first patient enrolled and implanted in the TLC-AU feasibility study.

What’s Morgans’ view?

In a note out of Morgans yesterday, the broker said 4Q25 delivered a clear step-up in commercial execution, with case volumes doubling q/q and revenue materially ahead of expectations, confirming accelerating physician uptake during the Limited Market Release (LMR). 

Preliminary 4Q revenue of US$0.87-0.94m exceeded its estimate by c60%, with FY25 revenue of US$1.55-1.62m validating early pricing and demand assumptions. 

We view clinical momentum with the WiSE-UP post-approval study and the TLC-AU feasibility study as supporting longer-term adoption and label expansion. Updated TAM of US$5.8bn (+60%) highlights a materially larger opportunity, underpinned by growth in leadless pacing and de novo CRT applications.

The broker has adjusted CY25-27 forecasts, with its DCF-based valuation increasing to $2.95. 

This updated price target indicates an upside of more than 180% from yesterday’s closing price of $1.05. 

The post Top broker says this ASX small-cap healthcare stock could be set to double appeared first on The Motley Fool Australia.

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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.

Great investments are often the ones that do not need constant attention. They just sit in your portfolio and compound year after year, building wealth quietly and consistently.

But not all Australian shares are capable of doing this. So, which ones could be worth considering if you want shares to hold forever?

Here are two Australian shares that I would be happy owning forever, backed by businesses with enduring demand and the ability to navigate change over time. They are as follows:

Cochlear Ltd (ASX: COH)

Cochlear is an example of a company whose relevance is largely independent of economic conditions.

As the global leader in implantable hearing solutions, Cochlear operates in a highly specialised medical field with significant barriers to entry. Its technology, intellectual property, and long-standing relationships with clinicians give it a competitive position that is difficult to challenge.

What stands out over a full market cycle is the stickiness of Cochlear’s ecosystem. Patients often remain with the same implant platform for life, creating ongoing demand for upgrades, accessories, and services. This generates recurring revenue that helps smooth earnings through different environments.

Demographic trends also work in Cochlear’s favour. Ageing populations and improved access to healthcare globally continue to support long-term demand, regardless of short-term economic fluctuations.

ResMed Inc. (ASX: RMD)

Another Australian share that could be a top option for investors is ResMed.

It also operates in a part of the healthcare system that does not depend on discretionary spending or economic confidence.

ResMed is a global leader in sleep apnoea and respiratory care devices, serving millions of patients worldwide. Importantly, the condition it treats remains significantly underdiagnosed, which creates a long runway for growth even without favourable economic conditions.

Management estimates that there are over 1 billion people worldwide suffering from sleep apnoea. This gives it a significant growth runway over the next decade and beyond.

Another positive is how embedded its products are in patient care. Once a patient begins therapy, ongoing use, replacement cycles, and software-driven monitoring create recurring demand. This shifts the business away from one-off device sales and toward a more durable revenue base.

ResMed has also invested heavily in digital health platforms and connected devices, which is strengthening relationships with clinicians and patients. That investment allows it to adapt as healthcare delivery evolves, rather than being disrupted by it.

Across different market cycles, demand for effective sleep and respiratory treatment is unlikely to fade, which is why ResMed remains a business I would be comfortable holding forever.

The post The outstanding Australian shares I’d be happy owning forever appeared first on The Motley Fool Australia.

More reading

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• How to become rich with ASX shares over the next 10 years
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• The ASX 200 stocks I’d be happy to hold until retirement

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

There are a few ASX dividend stocks that have as defensive earnings as Coles Group Ltd (ASX: COL). The nature of its operations and the dividend record make it a truly impressive option.

As one of Australia’s major national supermarket companies, it has a very important role in keeping the country fed. I’d say there are few businesses that have as resilient earnings as Coles.

While it may not be the cheapest retailer around, it offers households a number of advantages such as the large number of supermarkets with long opening hours. It also has an online offering which is seeing rapid growth. Let’s dive into the company’s appeal.

Strong growth

Coles Group’s impressive sales performance shows how the business is executing its game plan better than Woolworths Group Ltd (ASX: WOW).

In the first three months of FY26, the Coles supermarket division saw sales revenue growth excluding tobacco of 7% year-over-year. Inflation excluding tobacco was 1.2%, so clearly the company is doing a good job at selling more items.

Coles supermarkets delivered e-commerce sales growth of 27.9% to $1.3 billion, with e-commerce sales now representing 13.3% of overall sales, showing its increasing importance to the overall picture.

The ASX dividend stock noted that during that quarterly period, two new supermarkets were opened and three were renewed.

With Australia’s population steadily increasing, combined with a little bit of underlying inflation for food items, I’m expecting Coles’ revenue to continue rising over the long-term, even if it doesn’t always outperform Woolworths as much as it is right now.

Broker UBS estimates that Coles could grow its revenue to $45.9 billion in FY26 and then reach $47 million in FY27.

Don’t forget that Coles’ Witron automated distribution centres should help significantly with efficiencies, boosting margins and stock flow.

ASX dividend stock credentials

Coles has increased its annual payout every year since 2019 – I prefer this steady approach to a dividend that bounces around. The company has shown how it can grow its payout in all types of market conditions during the last several years, making it an appealing business to own in any market.

If I’m relying on the cash payments, I’d want to see the dividend payout continue flowing reliably into my bank account, even in a downturn.

The broker UBS thinks the ASX dividend stock could hike its payout to 79 cents per share in FY26, which would be a grossed-up dividend yield of 5.3%, including franking credits, at the time of writing.

In FY27, the annual dividend per share could grow again to 93 cents per share, which would be a grossed-up dividend yield of 6.3%, including franking credits.

The post I’d buy this ASX dividend stock in any market appeared first on The Motley Fool Australia.

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

When markets feel uncertain, I think it makes sense to look for resilience. That is where Telstra Group Ltd (ASX: TLS) excels.

Telstra is not a stock I expect to double quickly, nor is it one that regularly features in conversations about the next big growth trend. But for defensive investors, and particularly those focused on blue-chip income and stability, Telstra shares still tick a number of important boxes.

A business built around essential services

At its core, Telstra provides services that Australians rely on every day. Mobile connectivity, broadband, and enterprise network services are not discretionary spending items for most households or businesses.

This gives Telstra a level of demand stability that many companies could only dream of. Even when economic conditions soften, people tend to prioritise their phone and internet bills. That characteristic alone makes Telstra shares appealing to defensive investors who want exposure to more predictable revenue streams.

The company’s dominant position in mobile also matters. Telstra continues to hold the largest share of the Australian mobile market, supported by network quality and coverage. While competition exists, Telstra’s scale and infrastructure investment create a barrier that is difficult for smaller players to replicate.

A reliable income profile

Another reason Telstra shares appeal to blue-chip investors is income.

Based on current pricing, Telstra offers a dividend yield of around 4%, which is attractive in the context of a large, established ASX company. Importantly, this dividend is underpinned by recurring cash flows rather than aggressive payout assumptions.

I do not view Telstra as a high-growth dividend stock. What I value more is the likelihood that its distributions remain sustainable through different economic environments. For investors who rely on portfolio income, that consistency is hugely important.

Improved focus and capital discipline

Telstra today looks very different from the Telstra of a decade ago.

The business has simplified its structure, exited non-core operations, and sharpened its focus on areas where it believes it has genuine advantages. Management has also placed greater emphasis on capital discipline, network efficiency, and cost control.

This does not eliminate risk, but it does improve visibility. For defensive investors, understanding how a company makes money and where it allocates capital is critical. Telstra’s strategy is easier to follow now than it has been in the past.

Exposure to long-term digital demand

While Telstra is often labelled as defensive and will never be described as a high-growth technology stock, it is not standing still.

Data consumption continues to grow, enterprise customers are investing in connectivity and digital infrastructure, and network reliability is becoming more important rather than less. Telstra’s exposure to these trends provides a steady growth outlook.

Telstra shares have a role in a diversified portfolio

For me, Telstra shares make the most sense when viewed as part of a broader portfolio.

They can help offset the volatility that comes with growth stocks, cyclicals, or more economically sensitive businesses. In periods of market stress, shares like Telstra often attract renewed interest from investors seeking stability and income.

But with every investment, Telstra shares are not risk-free. Competitive pressures, regulatory changes, and capital expenditure requirements remain ongoing considerations. But relative to many ASX shares, I think Telstra offers a balance of scale, predictability, and income that defensive investors often value.

Foolish takeaway

Telstra may not be exciting, but defensive investing rarely is.

I think its essential services, recurring revenue, solid dividend profile, and improved operational focus continue to make Telstra shares appealing for investors who prioritise blue-chip stability over rapid growth.

The post Why I think Telstra shares are a strong blue-chip buy appeared first on The Motley Fool Australia.

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

Many ASX 200 stocks enjoyed a steady climb yesterday as the S&P/ASX 200 Index (ASX: XJO) rose 0.56% 

However two stocks that were heavily sold off were Zip Co Ltd (ASX: ZIP) and GQG Partners Inc. (ASX: GQG). 

These two ASX 200 stocks fell by 7.6% and 8.6% respectively. 

So what was behind the sell-off? And is it a buy the dip opportunity?

Let’s find out. 

Zip Co Ltd (ASX: ZIP) 

The buy now, pay later (BNPL) company saw its share price tumble more than 7% yesterday. 

It appears investors were likely profit-taking. 

There was no sensitive news out of the ASX 200 company yesterday. 

Zip shares were up more than 27% in the six months prior to yesterday’s sell-off which had been on the back of measured and strategic growth. 

Following yesterday’s decline, it appears this could be a true, buy the dip opportunity for investors. 

Despite yesterday’s sharp fall, Zip is fundamentally the same company. There was no change in guidance or forecast, just a slightly lower valuation. 

Looking at price targets out of analysts, it seems they would tend to agree. 

Earlier this month, Macquarie retained an outperform rating and $4.85 price target on Zip shares. 

From yesterday’s closing price of almost 48% from yesterday’s closing price of $3.28. 

Furthermore, the Motley Fool’s Grace Alvino reported yesterday that Commsec Data shows a projected earnings per share of 7.9 cents in FY26, rising to 12.1 cents in FY27. 

The upside tipped from TradingView is even more, with an average one year price target of $5.45 for this ASX 200 stock. 

This indicates more than 66% upside. 

GQG Partners Inc. (ASX: GQG)

Yesterday was an equally tough day for GQG Partners shares. 

This ASX 200 company saw its share price fall by 8.6%. 

This came after the global fund manager reported Funds Under Management (FUM) of US$163.9 billion at 31 December 2025. 

This was up from US$153.0 billion a year ago.

However, it also reported December 2025 net outflows of US$2.1 billion which may have contributed to the sell off as overall, annual net inflows were negative. 

After dropping 8% however, it could now be a good entry opportunity for investors. 

Macquarie currently has an outperform rating and $2.50 price target on its shares.

This indicates an upside of more than 52%. 

Even more tempting for income investors is the projected yield of approximately 12% in the coming years. 

The post After crashing 8% yesterday, should investors buy the dip on these ASX 200 stocks? appeared first on The Motley Fool Australia.

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• GQG Partners reports US$163.9bn FUM for 2025

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 recommended Gqg Partners. 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 off to a positive start in 2026. 

The benchmark index is already 1.6% higher than the start of the year. 

However that pales in comparison to these two ASX 200 stocks. 

Greatland Resources Ltd (ASX: GGP) and Austal Ltd (ASX: ASB) have already increased by 20% and 31% respectively. 

The question must be asked if this growth is too good to pass up, or just a fleeting new years rise.

Here’s what analysts are saying. 

Greatland Resources Ltd (ASX: GGP)

Greatland Resources operates as a gold and copper mining company.

As you might expect, it’s been one of many ASX gold shares that has rocketed over the past year as investors have turned to the safe-haven asset. 

Its share price is up more than 72% in the last year. 

They enjoyed a 5% rise yesterday and 7% rise on January 7 on the back of a strong quarterly update.

The company reported gold production of 86,273 ounces for the quarter, in addition to copper output of 3,528 tonnes. This marks a big improvement on the September quarter. 

The company also reported an impressive balance sheet that included $948 million in cash and no debt.

So what’s ahead?

The Motley Fool’s Aaron Teboneras reported that the gold price surged to new record highs yesterday. 

This has come amidst more global political unrest along with tensions involving Iran, Israel, Venezuela, and the US that have increased fears of broader conflict. 

These factors could continue to see investors push towards safe-haven assets like gold. 

Despite this, analysts’ views on this ASX 200 stock indicate it may be trading at an inflated value. 

TradingView has an average 12 month price target of $11.12 which is almost 12% above its current share price. 

Austal Ltd (ASX: ASB)

Many of the same geopolitical factors have helped push Austal shares higher to start 2026. 

The company is an Australian-based shipbuilder. Its products include naval vessels, defence surface warfare combatants, high-speed support vessels, patrol boats for law enforcement, offshore vessels, as well as passenger and vehicle ferries. 

The company also installs and maintains vessel command and control systems, communication and radar technology, and information management systems.

Global defence spending has been on the rise which has contributed to several key contracts being won by this ASX 200 company. 

Its share price is now up 183% over the last 12 months. 

In recent news, US President Donald Trump also said that the 2027 US defence budget should be US$1.5 trillion, well above the US$901 million so far approved.

This could be further good news for Austal. 

At the time of writing, Bell Potter has an $8.00 price target and hold recommendation, suggesting the current share price is close to fair value. 

The post These ASX 200 stocks are already up 20-30% in 2026! Are they a must buy? appeared first on The Motley Fool Australia.

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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.

The S&P/ASX 200 Index (ASX: XJO) lifted 6.8% and delivered a total return, including dividends, of 10.32% last year.

The following three ASX 200 shares were the star performers of their sectors, achieving the highest capital growth among their peers.

Are they still good buys?

Let’s defer to the experts.

Deep Yellow Ltd (ASX: DYL)

ASX 200 uranium explorer Deep Yellow was the No. 1 share in the energy sector for 2025.

Deep Yellow shares rose 63% to close at $1.84 per share on 31 December.

The uranium price was volatile last year but gained momentum in the second half due to higher demand and constrained supply.

The US increased its commitment to nuclear power with an $80 billion deal with Canadian Westinghouse Electric to build nuclear reactors.

The uranium price closed at US$82.85 per pound yesterday, up 12% over 12 months.

Ord Minnett has a buy rating on Deep Yellow with a share price target of $2.

Jefferies has a hold rating with a target of $1.85.

Yesterday, the ASX 200 uranium share closed at $2.01, down 1%.

Generation Development Group Ltd (ASX: GDG)

Retirement and investment solutions provider Generation Development Group was the highest riser in the financials sector in 2025.

The Generation Development Group share price rose 66% to finish the year at $5.89.

Macquarie gives Generation Development Group shares an outperform rating with a 12-month price target of $6.70.

Yesterday, the ASX 200 financial share closed at $6.05, down 1.3%.

Codan Ltd (ASX: CDA)

Electronics solutions provider Codan was the No. 1 share in the tech sector for 2025.

The Codan share price ripped 77% to finish the year at $28.43.

Codan designs and manufactures electronics solutions for government, corporate, NGO, and consumer clients.

Yesterday, UBS reiterated its hold rating on Codan shares and increased its 12-month share price target from $34 to $37.

MA Financial has a buy rating on the ASX 200 tech share with a $42.31 target.

Last Friday, the Codan share price ripped 17% after an impressive half-year profit update.

Yesterday, Codan shares closed at $37, up 0.8%.

The post These 3 ASX 200 shares led their sectors last year. Are they still good buys? 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 positions in and has recommended Macquarie Group. The Motley Fool Australia has positions in and has recommended Macquarie Group. The Motley Fool Australia has recommended Generation Development Group and Ma Financial Group. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

When investing through a self-managed super fund (SMSF), you want ASX dividend shares that have dependable cash flows and businesses need to be resilient enough to operate through different economic conditions.

While no dividend is ever guaranteed, some ASX shares are far better positioned than others to keep paying shareholders over time.

With that in mind, here are three ASX dividend shares that could suit investors building an SMSF portfolio focused on long-term income.

Lottery Corporation Ltd (ASX: TLC)

The Lottery Corporation stands out as one of the most defensive income plays on the ASX.

As the operator of Australia’s leading lottery brands, its earnings are largely insulated from economic cycles. Ticket sales tend to remain steady regardless of whether consumer confidence is high or low, which supports predictable cash flows.

What makes Lottery Corporation particularly attractive for an SMSF is its capital-light business model. With minimal reinvestment requirements, a large portion of earnings can be returned to shareholders as dividends. This has allowed the company to establish itself as a consistent income payer since its demerger.

For investors seeking stability and visibility around future distributions, Lottery Corporation is hard to ignore.

Sonic Healthcare Ltd (ASX: SHL)

Another ASX dividend share that could be a top pick is Sonic Healthcare.

It is a global leader in pathology and diagnostic imaging, operating across Australia, Europe, and the United States. Demand for diagnostic testing does not disappear during economic downturns, which gives Sonic Healthcare a defensive earnings profile.

While its earnings surged during the pandemic due to testing demand and have since normalised, Sonic continues to generate strong cash flow from its core operations. Its diversified geographic footprint and disciplined approach to acquisitions also help smooth earnings over time.

For SMSF investors, Sonic provides exposure to healthcare growth alongside a history of dependable dividends.

Woolworths Group Ltd (ASX: WOW)

Finally, Woolworths could be an ASX dividend share to buy for an SMSF.

As Australia’s leading supermarket operator, Woolworths benefits from everyday consumer demand. Regardless of what is happening in the local or global economy, Australian households still need to spend on food and essential items. This supports resilient revenue and cash generation.

This steady operating performance underpins its ability to pay regular dividends to shareholders.

For an SMSF, Woolworths offers a combination of defensive earnings, scale advantages, and reliable income.

The post 3 strong ASX dividend shares to buy for your SMSF appeared first on The Motley Fool Australia.

More reading

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

Xero Ltd (ASX: XRO) shares closed 0.36% higher on Tuesday afternoon, at $108 a piece. So far in 2026 the shares have dropped 4.89%. They’re currently trading 34.71% below levels this time last year.

From US-acquisition news which spooked investors to lower-than-expected financial results, the company faced strong headwinds in 2025. But I think the reaction was way overdone and the level of investor sell-off was unfounded.

Right now, I think the cloud-based, accounting software company is a screaming buy. And here are three reasons why.

1. The business is stable

Despite Xero’s share price sell-off last year, the business is stable and well-positioned for an uptick in growth. 

There is a global shift of small to medium businesses moving towards cloud-based accounting software, and Xero is poised to capture any increase in demand.

The company works on a software-as-a-service (SaaS) subscription-based model which offers monthly plans at various price points. This means the software is “sticky” and has a high retention rate. This type of business model means Xero has a stable recurring revenue, global exposure and profitability. It also means it has a scalable software platform which doesn’t rely on consumer spending pressure (in other words, it has low downside risk).

The company has also previously demonstrated that it can remain resilient and grow through various stages of economic cycles.

2. The business is actively expanding

Xero is also constantly expanding the products it can offer its clients. In 2025 the company added features like online bill payments, better analytics, and customisable home pages to make its software even more appealing to customers.

Although its Melio acquisition last year didn’t sit well with Aussie investors, the move is part of Xero’s strategy to grow its US business. By integrating a US payments platform with its current accounting software, it could open up new revenue streams for the business and accelerate its presence in the US small-business market.

Xero is also investing in automation and AI tools to make its software more valuable to small businesses. This is a key focus for the business in 2026.

3. Xero shares could double in 2026

I’ve said previously that I’m quietly confident that Xero shares could double in value in 2026, or go even higher.

TradingView data shows that most analysts (11 out of 14) are also bullish on Xero shares over the next 12 months. 

The maximum target price is $228.85 a piece, which implies a huge 111.90% upside for investors at the time of writing.

UBS is positive on the medium-term growth outlook for Xero and believes the current share price is an “attractive buying opportunity”. The broker has a $194 price target on the shares.

Macquarie has an outperform rating and $228.90 price target on the shares, saying the company is well-positioned for growth in the US.

The post 3 reasons Xero shares are a screaming buy right now appeared first on The Motley Fool Australia.

More reading

• Why I look at past performance of ASX shares to help think about the future performance outlook
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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 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.

These 3 ASX healthcare shares have all had their fair share of issues over the past few months.

Investors walked out, and as a result the share prices of CSL Ltd (ASX: CSL), Sigma Healthcare Ltd (ASX:SIG) and Sonic Healthcare Ltd have been under pressure.

But it’s not all pain and pills. Brokers see potential 15-35% upside for these quality ASX healthcare shares.

Let’s go and check them out.

CSL Ltd (ASX: CSL)

CSL, the $85 billion healthcare heavyweight, has had a proper clanger of a year. The share price slid as investors panicked over high plasma collection costs, sluggish margin recovery and patchy vaccine demand.

For a stock once treated like a superannuation heirloom — buy it, forget it, brag about it — the stumble has been confronting.

But here’s the plot twist. This ASX healthcare share hasn’t forgotten how to grow. Plasma volumes are ticking up, cost pressures are easing and management insists margins can recover with a bit of patience and fewer market tantrums.

This year doesn’t need to be heroic. It just needs to be less disappointing for sentiment to flip. Yes, execution matters and margins must recover.

Still, analysts remain bullish, tipping an average 12-month price target of $232.15. That points to a 34%, suggesting the market may have overdone the exodus.

Sigma Healthcare Ltd (ASX: SIG)

Sigma Healthcare hasn’t been feeling the love lately — and it’s not hard to see why.

First up: merger mayhem. The Chemist Warehouse tie-up sent integration and transaction costs through the roof, smashing near-term profits and rattling investors.

Then there’s the hangover from past mistakes. A bungled ERP rollout a few years back snarled supply chains, drove pharmacies into competitors’ arms, and bruised the credibility of the ASX healthcare share.

But it’s not all bad news. The Chemist Warehouse merger supercharges Sigma’s scale, plugging wholesale, distribution and retail into one powerful machine. If the synergies land, earnings could follow.

Tailwinds help too. Australia’s ageing population and steady demand for health products keep the long-term story intact.

Analysts see strong scale, improved EBITDA and a growing network which give the ASX healthcare share defensive cash flows and growth runway. A rare thing in healthcare retail.

Brokers predict 12-month average price targets of around $3.30, which implies a potential gain of almost 15% above current levels of $2.90.

Sonic Healthcare Ltd (ASX: SHL)

The 7^th largest ASX healthcare share has had a rollercoaster run. Investors sulked after COVID testing faded and earnings guidance was modest, but that’s exactly why the value hunters might sniff opportunity.

Expectations are now realistic, maybe even a little too low. Some fair-value models suggest Sonic Healthcare could be 30–40 % undervalued relative to the current price, implying a fair value above $30+ if growth plays out.

The stock currently draws a mix of hold and buy views, with price targets back above recent levels and potential recovery from recent acquisitions and synergy boosts.

Weakness? Margins still feel the hangover from lower testing demand and mixed sentiment from brokers, so Sonic Healthcare isn’t a shiny growth rocket. The ASX healthcare share is more a steady-eddy play.

Bell Potter has assigned a buy rating and a $33.30 price target. Based on the share price of $23.03 at the time of writing, this implies a potential upside of 32% for investors over the next 12 months.

Bell Potter is on the bullish side, as the average 12-month target price is $26.73. However, that still points to 18% upside. It could bring the total earnings in 2026, including a dividend yield of 5.2%, to well over 20%.

The post 3 quality ASX healthcare shares worth buying now appeared first on The Motley Fool Australia.

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