The CSL Ltd (ASX: CSL) share price has been through a tough time over the past two years. As the chart below shows, it’s down more than 50% since August 2024.

As a result of this decline, it has fallen below Wesfarmers Ltd (ASX: WES) and Macquarie Group Ltd (ASX: MQG) in market capitalisation terms.

The question now is whether the company is on track to recover some of that lost ground or whether it’s going to go even lower. Let’s take a look at what analysts think of the company’s potential.

Expert views on the CSL share price

According CMC Invest, there are a number of positive opinions on the business. There are currently seven buy ratings, four hold ratings and no sell ratings.

A price target tells us where analysts think the share price will go in a year – the average price target on CSL shares is $215.13, according to CMC Invest. That implies a possible rise of 52% from where it is today.

UBS is one of the brokers that likes CSL right now, with a price target of $235, implying a possible rise of 66%.

Why UBS likes the ASX healthcare giant

UBS notes that the CSL share price valuation is appealing, though a recovery in the gross profit margin could take a while.

UBS is expecting CSL to prioritise volume over price as it seeks to re-establish its position as the low-cost supplier. This strategy is “likely to weigh on average selling prices, particularly as it seeks to replace tender volumes, most notably with the NHS”, according to UBS.

The broker also notes that the interim CEO’s track record inspires confidence, but time is needed to turn this around. Gordon Naylor has more than 30 years of CSL experience, having help senior engineering, operational, financial and leadership roles.

UBS noted that Naylor’s “deep understanding of the plasma and flu businesses makes him a highly credible choice to lead the company through its current challenges.”

It’s not a booming market for CSL right now, with global plasma-derived therapy sales only increasing by just 4% in 2025, which is much lower than the historic growth, largely due to the US reimbursement cuts.

But, UBS did highlight underlying demand growth was “solid with Ig volumes up 7-8% and like-for-like sales up 8-9%. CSL’s poor results were attributed to the loss of key tenders and poor commercial execution, particularly in the large US market.”

The broker notes that:

Our review of competitor results points to market share losses for CSL across Ig, subcutaneous Ig, albumin and hereditary angioedema. The flu business was the sole area of strength, with Seqirus share rising to ~33%.

UBS projects that the business could generate net profit of US$3.4 billion in FY26 and US$3.7 billion in FY27.

The post Here are the latest growth forecasts for the CSL share price 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 positions in and has recommended CSL, Macquarie Group, and Wesfarmers. The Motley Fool Australia has positions in and has recommended Macquarie Group. The Motley Fool Australia has recommended CSL and Wesfarmers. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

When I think about investing in blue-chip shares, I’m usually looking for a few key things.

First, I want businesses with strong competitive positions. Second, I want companies that have proven they can grow over long periods of time. And finally, I like businesses that operate in industries with favourable long-term trends.

The ASX 200 has plenty of high-quality blue-chip shares worth considering. But if I had $10,000 ready to invest today, these are three that I find particularly appealing right now.

Woolworths Group Ltd (ASX: WOW)

Woolworths might not be the most exciting company on the ASX, but that’s part of what I like about it.

Supermarkets are a classic defensive business. People still need to buy groceries regardless of what the economy is doing, which helps provide a steady stream of revenue.

Woolworths also benefits from its significant scale. It serves 24 million customers each week across its growing network of businesses. Combined with its strong brand recognition and supply chain advantages, it is very difficult for competitors to challenge its position in the Australian grocery market.

I also think the company’s investments in technology, online shopping, and supply chain efficiency could help support steady earnings growth over time.

It may not deliver explosive returns, but personally I see Woolworths as the kind of reliable blue chip that can compound value steadily for years.

Macquarie Group Ltd (ASX: MQG)

Macquarie is one of the most unique companies in the Australian market, in my opinion.

While many banks focus mainly on traditional lending, Macquarie has built a global financial services business spanning infrastructure investing, asset management, commodities trading, and specialist banking.

What stands out to me is its ability to adapt. Over the past few decades, the company has repeatedly evolved its business model to capture new opportunities across global markets.

Macquarie has also developed an exceptional reputation in infrastructure investing, an area that I think will continue to grow as governments and businesses invest in energy, transport, and digital infrastructure.

In my view, Macquarie is one of the most dynamic and internationally focused companies in the ASX 200.

Cochlear Ltd (ASX: COH)

Cochlear is another blue-chip ASX 200 share that I believe has powerful long-term growth potential.

The company is a global leader in implantable hearing solutions, and its technology has transformed the lives of hundreds of thousands of people with severe hearing loss.

What stands out to me is that the company operates in a market with significant unmet demand. Hearing loss affects millions of people globally, yet only a small percentage of eligible patients currently receive implantable hearing devices.

As awareness grows and healthcare systems expand access to treatment, I think Cochlear has a long runway for growth.

The company also invests heavily in research and development, which helps maintain its leadership position in the industry.

Foolish takeaway

If I had $10,000 to invest in ASX 200 blue-chip shares today, I would want exposure to a mix of defensive stability and long-term growth.

Woolworths offers resilience through its dominant position in the supermarket sector. Macquarie provides exposure to global financial markets and infrastructure investment. And Cochlear operates in a healthcare market with significant long-term growth potential.

The post Where I’d invest $10,000 in ASX 200 blue-chip shares right now 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 positions in and has recommended Cochlear and Macquarie Group. The Motley Fool Australia has positions in and has recommended Macquarie Group and Woolworths Group. 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.

If you have a high tolerance for risk, then it could be worth hearing about the ASX defence stock that Bell Potter is tipping as a buy.

This is especially the case given that the broker believes it could more than double in value over the next 12 months.

Which ASX defence stock?

The stock that Bell Potter is recommending to clients is Titomic Ltd (ASX: TTT).

It is a cold spray metal coating technology company specialising in additive manufacturing and coating and repairs.

Bell Potter highlights that cold spray uses compressed gas to accelerate metal powders to supersonic speeds. This enables kinetic energy to fuse/plastically deform the particles onto a substrate in solid form.

In addition, the company’s high pressure systems can accept speciality alloy powders and manufacture large high-spec components. This means that key target markets are the global aerospace and defence sectors, and the natural resources and energy sectors.

What is the broker saying?

Bell Potter was at the ASX defence stock’s investor day in the US recently and was impressed with what it saw. It said:

The event highlighted TTT’s unique additive manufacturing and coating and repairs capabilities, and leverage to US and global defence spending. From the Strategic Advisory Group, it was clear that US aerospace and defence activity is at an inflection point as the country develops hypersonic systems, addresses supply chain vulnerabilities, and updates an ageing installed asset base. TTT is enjoying the tailwinds of a significant culture-change and increased sense of urgency across the US Department of War and broader Washington bureaucratic system.

The broker also notes that 2027 could be the year that production really starts to kick off. It explains:

Last year, TTT established US-based capabilities for technical validation and to service defence prime qualification activities in 2026. TTT is now engaged with NASA and several tier one defence prime contractors for qualification and is progressing other critical industry certifications (AS9100, DNV maritime approval). By the end of 2026, TTT expect to convert from qualification phase to initial production, which should rapidly scale from 2027. The company also expects that non-dilutionary funding opportunities will crystalise this year.

Big potential returns

According to the note, Bell Potter has retained its speculative buy rating and 50 cents price target on the ASX defence stock.

Based on its current share price of 21.5 cents, this implies potential upside of 130% for investors over the next 12 months.

Commenting on its recommendation, the broker said:

TTT provides leverage to the emerging application of its cold spray technology in Additive Manufacturing (AM) for defence, aerospace and natural resources markets. US defence spending as a percentage of GDP is growing off a cyclical low and is largely being driven by modernisation of its defence industrial base. TTT’s TKF technology has several advantages over traditional casting and forging manufacturing process including shorter lead-times and production cycles and improved material properties.

The post Bell Potter says this ASX defence stock could rocket 130% 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 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 Meridian Energy Ltd (ASX: MEZ) share price is in focus today after the company released its operating update for February 2026, showing customer growth of 2.1% during the month and a lift in total water inflows for the year to date.

What did Meridian Energy report?

• February retail customer numbers rose 2.1%, up nearly 20% over the past year.
• Total water inflows for financial year to date were 129% of historical average.
• February 2026 hydro storage remained robust, ending at 110% of average nationally.
• Generation in February was 5.2% higher than last year, with increases in both hydro and wind output.
• Retail sales volumes in February were 2.7% lower than a year ago, mainly from reduced irrigation demand.
• Average generation price received in February dropped 83.7% year-on-year.

What else do investors need to know?

February saw a mix of wet and dry weather, with the “Valentine’s Storm” delivering above-average rainfall to much of New Zealand, while inland South Island areas stayed drier. Despite recent lower inflows, storage levels are well above average, keeping Meridian’s generation system in a strong position for autumn.

Residential, SMB, and large business sales were all higher compared to last February, but agriculture and corporate segments saw lower volumes. Wholesale prices fell sharply, and outages on the HVDC link between the islands limited power transfers for part of the month.

What did Meridian Energy management say?

CEO Mike Roan said:

Although inflows eased during February, this is the first below-average month in the past six. Storage levels remain robust, leaving the system well placed heading into autumn. Our retail growth remains strong. While lower irrigation demand saw sales volumes dip marginally year-on-year, customer numbers increased 2.1% during February, lifting total growth to nearly 20% over the past year, adding further scale and momentum to our Retail business.

What’s next for Meridian Energy?

Meridian is heading into autumn with strong hydro storage, even after a relatively dry February. The company highlights ongoing growth in customer numbers and expanding momentum in its Retail business as areas of continued focus, alongside careful management of storage and generation as weather patterns shift.

Investors can access weekly storage and lake level updates on Meridian’s website for further insight into trends as autumn progresses.

Meridian Energy share price snapshot

Over the past 12 months, Meridian Energy shares have declined 8%, trailing the S&P/ASX 200 Index (ASX: XJO) which has risen 10% over the same period.

View Original Announcement

The post Meridian Energy: February 2026 update shows growth and strong storage appeared first on The Motley Fool Australia.

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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.

ASX dividend stock Lovisa Holdings Ltd (ASX: LOV) could be one of the most appealing buys within the S&P/ASX 300 Index (ASX: XKO) right now. After falling 52% since August 2025, as the chart below shows, the business is trading at much better value.

Lovisa sells affordable jewellery through its global store network that’s across every continent. It also has a start-up business called Jewells in the UK.

A jewellery retailer may not instantly strike investors as a good opportunity, but it has already demonstrated a very strong capability to deliver pleasing and growing dividends.

Let’s take a look at what makes it an appealing buy today after its fall.

Strong passive income credentials

The business has already delivered massive dividend payout growth over the past decade. The total of its last two dividends has increased by close to 10x compared to the annual payment in 2016.

I’m not expecting the dividend to grow by another ten times in the upcoming decade, but I do think that its store growth and total sales growth will help send the Lovisa share price and dividend substantially higher in the coming years.

Broker UBS projects that the business could pay an annual dividend per share of 79 cents in FY26. That would be a dividend yield of 3.8%, excluding the effect of any franking credits.

UBS then suggests that the ASX dividend stock could then pay an annual dividend per share in FY27 of 93 cents – a rise of 17.7% year-over-year. That translates into a possible dividend yield of 4%, excluding any franking credits.

The broker thinks the Lovisa payout could continue climbing each year to FY30, reaching a potential payment per share of $1.33. This would be an increase of 68% compared to the estimated FY26 payout. The forecast payout would translate into a dividend yield of 6.4% by FY30, excluding franking credits.

In my mind, there are few ASX dividend shares capable of providing a dividend yield of around 4% (or more) in FY26 and delivering a strong rate of growth over the next few years.

Why this is a good time to invest in the ASX dividend stock

I doubt there will be many times that the share price will decline 50%. It currently looks like an especially attractive buying opportunity for long-term returns.

The FY26 half-year result delivered compelling growth, with 85 new stores opened to end the period with 1,095 locations. Underlying revenue grew 22.7% to $498.1 million and underlying net profit increased 21.5% to $69.6 million.

It’s difficult to say how much the current events in the Middle East will affect its financials in FY26 and FY27, but I’m confident about the long-term.

Based on the current profit predictions by UBS, it’s valued at just 21x FY27’s estimated earnings. With its global growth plans and the potential for its margins to steadily climb higher thanks to operating leverage, I think the long-term still looks very bright.

The post 1 ASX dividend stock down 52% I’d buy right now 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 positions in and has recommended Lovisa. The Motley Fool Australia has recommended Lovisa. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

The lower the ASX share market goes, the better value the opportunities are, in my view. ASX growth shares could be a particularly good investment right now, due to their relatively attractive valuations and potential for them to deliver strong earnings growth from here.

Compounding is a very powerful financial force that helps businesses grow into larger ones over time.

It’s very easy to underestimate the power of compounding. For example, you’d think it’d take around a decade for an investment to double in value if it’s growing at an average of 10% per year. But, it actually takes less than eight years to double.

Growing even faster than 10% can deliver significant compounding. I think the below three ASX growth shares are very good prospects for delivering solid net profit growth and I’d happily invest $20,000 into them.

Tuas Ltd (ASX: TUA)

Tuas is a rapidly-growing Singaporean telco. At its annual general meeting (AGM), the business reported it had reached 1.34 million active mobile subscribers and 36,200 active broadband services.

I’m confident the business can continue gaining market share in Singapore with its value-focused offerings. More users means more operating leverage as its costs are spread across a greater number of subscribers.

The ASX growth share is becoming increasingly profitable – in the first quarter of FY26 it made $9.1 million of net profit, which is more profit than it made in the entire 2025 financial year (of $6.9 million). It also made $44.2 million of revenue and $19.9 million of operating profit (EBITDA) in the first quarter of 2026.

With the bonus of the acquisition of Singapore competitor M1 on the horizon to boost its scale, I think Tuas’ profit outlook is very compelling. If it can successfully expand beyond Singapore to other Asian countries then it could have an even stronger growth outlook.

Pinnacle Investment Management Group Ltd (ASX: PNI)

Pinnacle is a leading business in the investment world. It has invested in stakes in a number of funds management businesses including Hyperion, Plato, Palisade, Resolution Capital, Solaris, Antipodes, Spheria, Firetrail, Metrics, Coolabah, Aikya, Five V, Life Cycle and Pacific Asset Management.

It’s not just a passive investor in these businesses, it helps them grow with services like seed funds under management (FUM), distribution and client services, middle office and fund administration, compliance, finance, legal, technology and other important infrastructure.

The FY26 half-year result saw net profit decline 11%, but that was only because of a reduction in performance fees generated (which are not likely to grow every year). Excluding performance fees, Pinnacle’s half-year net profit increased 37% year-over-year and 11% half-over-half.

Its FUM may have reduced during the last few months because of the volatility, but the 33% drop of the Pinnacle share price since October 2025 looks like a great time to invest to me.  

Nick Scali Ltd (ASX: NCK)

Nick Scali is one Australia’s largest furniture retailers through its Nick Scali and Plush brands.

Rising inflation and the prospect of higher interest rates may be causing the market to push the Nick Scali share price. At the time of writing, it’s down around 38% since the high in January 2026.

This looks like a great time to invest because the company is increasing its growth potential with its expansion in the UK. It’s rebranding the Fabb Furniture stores in the UK to Nick Scali stores.

The UK has a much larger population than Australia, giving the ASX growth share a large addressable market to target. Additionally, Nick Scali can sell its own furniture in the rebranded Nick Scali UK stores, which comes with a significantly higher gross profit margin.

If Nick Scali can continue adding to its ANZ and UK store networks, it can grow sales and net profit, even if sales at existing stores don’t grow as fast in 2026 as 2025.

The FY26 half-year result saw the company grow its total net profit by 36.4% to $41 million, while underlying net profit increased 23.1% on revenue growth of 7.2%, showing its ability to deliver rising margins.

The post Where I’d invest $20,000 into ASX growth shares right now appeared first on The Motley Fool Australia.

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Motley Fool contributor Tristan Harrison has positions in Pinnacle Investment Management Group and Tuas. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Pinnacle Investment Management Group. The Motley Fool Australia has positions in and has recommended Pinnacle Investment Management Group. The Motley Fool Australia has recommended Nick Scali. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

At the start of each week, I like to look at ASIC’s short position report to find out which shares are being targeted by short sellers.

This is because I believe it is well worth keeping a close eye on short interest levels as high levels can sometimes be a sign that something isn’t quite right with a company.

With that in mind, here are the 10 most shorted shares on the ASX this week according to ASIC:

• Domino’s Pizza Enterprises Ltd (ASX: DMP) is the most shorted ASX share with short interest of 15.6%. It appears that short sellers believe the struggling pizza chain operator’s turnaround strategy will not be a success.
• Treasury Wine Estates Ltd (ASX: TWE) has seen its short interest rise to 14.8%. This wine giant has been battling very tough trading conditions. Short sellers may not believe a change is coming in the near term.
• Telix Pharmaceuticals Ltd (ASX: TLX) has short interest of 14.2%, which is up since last week. This radiopharmaceuticals company has been facing delays with FDA approvals. Short sellers don’t appear confident that regulators will be approving its therapies any time soon.
• Guzman Y Gomez Ltd (ASX: GYG) has short interest of 13.8%, which is up week on week. This burrito seller continues to struggle and make a loss in the United States market, which was supposed to be its largest growth opportunity.
• Polynovo Ltd (ASX: PNV) has short interest of 13%, which is up since last week. This medical device company’s shares trade on sky-high earnings multiples.
• Nanosonics Ltd (ASX: NAN) has 11.4% of its shares held short, which is up week on week. Last month, this infection prevention company posted a 3% decline in profit before tax during the first half.
• Boss Energy Ltd (ASX: BOE) has short interest of 11.4%, which is down significantly since last week. With the uranium producer’s shares down 65% since the start of July on production concerns, some short sellers may be buying back shares to lock in their gains.
• IDP Education Ltd (ASX: IEL) has 10.8% of its shares held short, which is down week on week. This student placement and language testing company has been battling changes to visa rules in key markets.
• Lynas Rare Earths Ltd (ASX: LYC) has short interest of 10.5%, which is up since last week. This may be due to valuation concerns and the rare earths producer’s shares rocketed over the past 12 months.
• Flight Centre Travel Group Ltd (ASX: FLT) has short interest of 9.7%, which is down week on week. There are concerns that the travel agent won’t deliver on its revenue margin targets.

The post These are the 10 most shorted ASX shares appeared first on The Motley Fool Australia.

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Motley Fool contributor James Mickleboro has positions in Domino’s Pizza Enterprises and Treasury Wine Estates. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Domino’s Pizza Enterprises, Nanosonics, PolyNovo, Telix Pharmaceuticals, and Treasury Wine Estates. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has recommended Lynas Rare Earths Ltd. The Motley Fool Australia has positions in and has recommended Treasury Wine Estates. The Motley Fool Australia has recommended Domino’s Pizza Enterprises, Flight Centre Travel Group, Nanosonics, PolyNovo, and Telix Pharmaceuticals. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

Amid of all of the volatility, there could be very attractive ASX share opportunities for investors to buy.

Share price declines give us the chance to buy certain companies at much cheaper valuations. These are the same businesses as last year, but the market has decided they are worth less than they were.

When an expert calls a business a buy, that’s interesting. When numerous analysts call a company a buy then that’s a very compelling signal to investors.

Let’s look at two well-liked ideas.

Collins Foods Ltd (ASX: CKF)

Collins Foods is a large operator of KFC restaurants in Australia and Europe.

According to the Commsec collation of analysts, there are currently 10 buy ratings on the ASX share. One of the brokers that rates the business as a buy is UBS, with a price target of $13.50.

Collins Foods recently gave a trading update and announced an acquisition.

UBS noted that the ASX share is buying eight KFC restaurants in Bavaria (centred around Munich) and this delivers a 50% increase to its German network.

Additionally, its German development plan has been expanded, with a target of between 45 to 90 greenfield (new) restaurants over the next four years, which is expected to add between 3% to 7% more earnings per share (EPS) than the previous growth target range.

In terms of the trading update, in the second half of FY26 to date, Collins Foods said that Australian total sales were up 6.2%, German total sales were up 9.1% and the Netherlands total sales were up 4.1%.

Each country’s like for like (LFL) sales growth was stronger than expected, according to the broker. Excitingly, UBS is expecting Collins Foods to increase its EPS at a compound annual growth rate (CAGR) between FY27 and FY30.

It’s only trading at 19x FY26’s estimated earnings, according to UBS’ estimates.

Premier Investments Ltd (ASX: PMV)

Premier Investments is the owner of Peter Alexander and Smiggle. It also owns a substantial minority stake of Breville Group Ltd (ASX: BRG).

According to the Commsec collation of analyst opinions, there are currently 11 buy ratings on the business. One of the brokers that rates Premier Investments as a buy is UBS.

The broker notes that Premier Investments is going to hand in its FY26 half-year result at the end of this week.

UBS noted that the business has provided guidance for the FY26 first half result of underlying profit of $120 million, which the broker is also estimating for the company. The broker is also forecasting net profit of $99.3 million, EPS of 62.1 ents and a dividend per share of 40.4 cents.

The broker has a buy rating on the ASX share because of its strong core ANZ Peter Alexander business and the extent that the Breville shares are “underappreciated within its valuation”, which makes the risk/reward attractive despite Smiggle being challenged and the start-up losses in Peter Alexander UK.

In ANZ, Peter Alexander has expanded its total addressable market (TAM) with its offer extending to men, kids, plus-size and accessories. UBS thinks the business is justified to invest in expanding the store network and refurbishing existing stores.

Based on UBS’ estimate, the Premier Investments share price is valued at 14x FY26’s estimated earnings.

The post 2 ASX shares highly recommended to buy: Experts appeared first on The Motley Fool Australia.

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Motley Fool contributor Tristan Harrison has positions in Breville Group. 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 Collins Foods and Premier Investments. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

These two S&P/ASX 200 Index (ASX: XJO) shares offer dependable income today while still delivering long-term growth.

While attractive yields alone don’t guarantee strong returns, companies with durable businesses and disciplined capital management can reward shareholders for years.

Two ASX 200 shares that stand out for their dividend potential are Medibank Private Ltd (ASX: MPL) and Wesfarmers Ltd (ASX: WES).

Medibank Private Ltd (ASX: MPL)

This ASX 200 share is one of Australia’s largest private health insurers, providing health insurance to millions of Australians through its Medibank and AHM brands.

One of Medibank’s key strengths is the defensive nature of the health insurance industry. Demand for health cover tends to remain relatively stable even during economic downturns, which helps support consistent earnings and cash flow.

Another advantage is its predictable revenue model. Premium income provides recurring cash flow, allowing the ASX 200 share to maintain a reliable dividend profile. The recent FY26 half-year result showed a number of positive growth numbers. This bodes well for future growth of its dividend payouts.

The company is also exposed to rising healthcare costs. If claims inflation accelerates faster than premium increases, margins could come under pressure. Health insurers face ongoing regulatory oversight, and changes to government policy could affect profitability.

Competition from other insurers is another factor to watch, particularly as providers compete to attract younger members to the private health system.

Medibank has developed a reputation as a strong ASX 200 income share. Medibank’s dividend policy is to distribute between 75% and 85% of underlying net profit after tax to shareholders, helping support consistent and relatively generous payouts.

Broker UBS is expecting dividend growth from the ASX 200 share over the next few years.

The broker forecasts that the annual dividend per share could be 19 cents in FY26, which translates into a potential grossed-up dividend yield of 5.4%, including franking credit at the time of writing.

Analysts have set an average 12-month price target at $5.03. That points to an 18% upside and could bring total earnings to well over 20% at the time of writing.

Wesfarmers Ltd (ASX: WES)

Wesfarmers is one of Australia’s largest diversified companies, with leading retail businesses including Bunnings, Kmart, Officeworks, and an expanding industrial and chemicals portfolio.

The $86 billion ASX 200 share’s biggest strength is its portfolio of dominant retail brands. Bunnings remains Australia’s leading home improvement retailer, while Kmart continues to grow thanks to its strong value proposition.

Wesfarmers also has a long track record of disciplined capital allocation. Management regularly reinvests in high-return projects while returning excess capital to shareholders through dividends and special distributions.

Retail is inherently cyclical and sensitive to consumer spending. In addition, Wesfarmers’ earnings are heavily reliant on a handful of major divisions, meaning any weakness in key segments like Bunnings or Kmart could affect overall performance.

Wesfarmers has built a reputation as a reliable dividend payer. UBS predicts that the business could deliver an annual dividend per share for FY26 of $2.13. That would be a grossed-up dividend yield of 4%, including franking credits, at the time of writing.

Brokers have set a price target for the ASX 200 share of $81.85, a potential gain of 8% over 12 months.

The business is expected to increase its payouts in the subsequent years, which is great news for investors wanting passive income.

In the 2027 financial year, the ASX 200 share is projected to pay an annual dividend per share of $2.31.

The post 2 ASX 200 shares with eye-catching dividend yields appeared first on The Motley Fool Australia.

More reading

• 3 ASX dividend shares I’d buy instead of Westpac
• A once-in-a-decade chance to earn a supersized passive income from ASX shares?
• What I’d do as a beginner with $50,000 to invest in ASX shares
• 2 ASX blue-chip shares offering big dividend yields
• With half year profits up 9% to $1.6 billion, are Wesfarmers shares a buy?

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

Westpac Banking Corp (ASX: WBC) has long been a popular choice for dividend investors.

And that’s easy to understand. The big four banks have historically paid generous fully franked dividends and have been reliable income generators for Australian investors.

But at the moment, I’m not convinced Westpac shares look particularly attractive.

Its share price has climbed strongly and its valuation now reflects a lot of optimism. As a result, I think it makes sense for investors to at least consider other opportunities in the market.

Personally, if I were looking for dividend income today, I would rather buy these ASX dividend shares instead of Westpac.

Telstra Group Ltd (ASX: TLS)

When I think about reliable dividend payers on the ASX, Telstra is one of the first companies that comes to mind.

The telecommunications giant generates steady cash flow from providing mobile, broadband, and network services to millions of customers across Australia. That kind of recurring revenue can be very supportive when it comes to paying dividends.

What stands out to me is how resilient the business model is. People might cut back on discretionary spending during tougher economic periods, but mobile and internet services are now essential parts of everyday life.

Telstra has also been investing heavily in its network and digital capabilities, which should help support its long-term competitiveness. In my view, that combination of reliable earnings and ongoing investment makes it an appealing option for income investors.

Wesfarmers Ltd (ASX: WES)

Wesfarmers might not always have the highest dividend yield on the ASX, but I still think it deserves attention from income-focused investors.

The company owns a portfolio of high-quality businesses including Bunnings, Kmart, and Officeworks. These retail operations generate strong cash flow and have historically delivered solid returns on capital.

What I personally like about Wesfarmers is the balance between income and growth. The company pays attractive dividends while also reinvesting in new opportunities and expanding its businesses.

That approach has helped it deliver strong long-term shareholder returns, which in my view can be just as important as the headline dividend yield.

APA Group (ASX: APA)

Infrastructure businesses can be particularly attractive for income investors, and APA Group is a good example.

The company owns and operates one of Australia’s largest energy infrastructure networks, including gas pipelines and energy assets that stretch across the country.

Many of its assets operate under long-term contracts, which helps provide predictable revenue streams. That kind of stability can support consistent dividend payments.

While the energy sector is evolving, infrastructure assets like pipelines remain an important part of the energy system. Personally, I think that stability makes APA a compelling option for investors seeking dependable income. Its forecast dividend yield of over 6% in FY26 is also attractive.

Foolish takeaway

Westpac will likely remain a popular choice for dividend investors.

But in my view, income opportunities on the ASX go well beyond it.

Companies like Telstra, Wesfarmers, and APA offer exposure to different industries while still providing attractive dividend income. For investors looking to diversify their income streams, I think these types of businesses are well worth considering.

The post 3 ASX dividend shares I’d buy instead of Westpac appeared first on The Motley Fool Australia.

More reading

• 2 ASX 200 shares with eye-catching dividend yields
• 3 top ASX dividend shares with 6%+ yields
• Here’s what Westpac says the RBA will do with interest rates next week
• How I’d start building an ASX retirement portfolio today
• A once-in-a-decade chance to earn a supersized passive income from ASX shares?

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