With the S&P/ASX 200 Index (ASX: XJO) trading around 8,863.1 points, just shy of its record high, it’s easy to assume that most opportunities have already passed us by. When markets run hot like this, value can feel scarce and new ideas harder to come by.

But broad index levels often hide what’s really going on underneath the surface. Even in strong markets, individual Australian shares can fall out of favour for company-specific or sector-specific reasons, creating pockets of opportunity for investors willing to look past the headlines.

Right now, I think that’s the case with a handful of Australian shares that have all touched 52-week lows this week, despite operating businesses that still have meaningful long-term potential.

Aristocrat Leisure Ltd (ASX: ALL)

Aristocrat Leisure is a good example of how sentiment can swing faster than fundamentals.

The share price weakness reflects concerns about slowing growth in parts of its business, particularly in digital, alongside a more cautious outlook from the market. But stepping back, Aristocrat still holds a dominant position in regulated gaming markets, especially in North America, where its land-based gaming operations continue to generate strong cash flows.

What I find compelling is that this is not a structurally broken business. Management has acknowledged near-term softness, but the long-term drivers remain intact, including content leadership, recurring revenue from installed machines, and disciplined capital allocation. In a market near record highs, a high-quality global operator like this trading at a 52-week low stands out to me.

CAR Group Ltd (ASX: CAR)

CAR Group is an Australian share where the market appears to be extrapolating short-term concerns too far into the future.

CAR’s platforms dominate online automotive listings across multiple geographies, and its business model is highly scalable with strong margins. The recent share price weakness has been driven by concerns around AI disruption, tech valuations, and cyclical softness in vehicle markets.

However, CAR has navigated these cycles before. Its platforms remain mission-critical for dealers, and pricing power tends to reassert itself as conditions normalise. Importantly, the company continues to invest in data, digital tools, and international expansion, which supports long-term earnings growth.

Seeing a business of this quality hit a 52-week low while the broader market is near its peak is exactly the sort of disconnect I like to pay attention to.

Temple & Webster Group Ltd (ASX: TPW)

Online furniture seller Temple & Webster Group has arguably been hit hardest by sentiment.

The housing slowdown, cost-of-living pressures, and weaker discretionary spending have all weighed on the outlook for furniture retailers. That has pushed Temple & Webster’s shares to a 52-week low, despite the company continuing to grow revenue and gain market share online.

What makes this interesting to me is the longer-term shift toward online furniture retailing, which is still underpenetrated in Australia. Temple & Webster’s asset-light model, strong brand recognition, and growing customer base position it well for an eventual recovery in housing activity and consumer confidence.

This is clearly a higher-risk name than the others and its shares are still not conventionally cheap, but I believe it offers significant upside if conditions improve.

Foolish takeaway

When markets are strong, it often pays to look where others aren’t. Aristocrat Leisure, CAR Group, and Temple & Webster have all been pushed to 52-week lows at a time when the ASX 200 is hovering near record levels.

That doesn’t mean they are risk-free. But it does suggest that a lot of pessimism is already reflected in their share prices. For investors willing to think beyond the next quarter, I believe these undervalued Australian shares are worth a closer look, even in a hot market.

The post In a hot market, the undervalued Australian shares to buy now appeared first on The Motley Fool Australia.

More reading

• Aussie income stocks: A once-in-a-decade chance to get richer?
• 3 ASX 200 shares trading at 52-week lows: Are they a buy?
• Is AI a real threat to CAR Group and REA Group shares?
• 2 stocks that could turn $100,000 into $1 million by 2035
• Why these ASX 200 shares could be dirt cheap

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 Temple & Webster Group. The Motley Fool Australia has recommended CAR Group Ltd and Temple & Webster Group. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

It doesn’t feel like a classic buying opportunity for income investors.

The ASX is hovering near record highs, headlines are generally positive, and on the surface it looks like most of the easy money has already been made. Historically, those conditions haven’t been great for finding value in ASX dividend-paying shares.

But dig a little deeper and a very different story emerges.

Across the market, a number of established Aussie income stocks are trading much closer to their lows than their highs. In many cases, this has less to do with permanent damage and more to do with temporary pressure on earnings and dividends. For patient investors, that combination can be powerful.

What’s happening?

Over the past couple of years, higher interest rates and cost-of-living pressures have had a major impact on the economy.

Some consumer-facing businesses have seen softer demand. In response, dividend expectations have been trimmed, growth has slowed, and share prices have been marked down accordingly.

This has pushed parts of the income universe into an uncomfortable spot.

Short-term pain

Income investing is not just about the next dividend check. It is about earning power over a full cycle.

Businesses like Accent Group Ltd (ASX: AX1) and Premier Investments Ltd (ASX: PMV) are good examples. Both operate in discretionary retail, which is one of the first areas to feel pressure when households tighten their belts. That pressure flows through to earnings and, ultimately, dividends.

But retail cycles are rarely permanent. When consumer confidence improves, these businesses can see earnings recover quickly. Importantly, dividends often rebound faster than share prices, because the income stream resets to reflect improved trading conditions.

For investors willing to look past the next year, buying during the trough of a cycle can significantly lift long-term income returns.

What else?

Some weakness can be cyclical.

Companies such as IPH Ltd (ASX: IPH) and CAR Group Limited (ASX: CAR) are facing cyclical headwinds in their respective markets.

Yet both businesses remain highly cash generative. Their current challenges appear cyclical rather than structural. When conditions normalise, their capacity to pay and grow dividends could improve meaningfully.

Foolish takeaway

This does not feel like an obvious income opportunity, but it could be.

When dividends are growing smoothly and sentiment is positive, income shares tend to be fully priced. When payouts are under pressure and confidence is low, valuations can become far more interesting.

For investors with patience, today’s environment could represent a rare chance to load up on quality Aussie income shares while expectations are subdued. If trading conditions improve over the next few years, the combination of recovering dividends and rising share prices could prove very rewarding.

The post Aussie income stocks: A once-in-a-decade chance to get richer? appeared first on The Motley Fool Australia.

More reading

• Is AI a real threat to CAR Group and REA Group shares?
• Got $5,000? 5 ASX income shares to buy and hold forever
• Why these ASX 200 shares could be dirt cheap
• 1 ASX dividend stock down 62% I’d buy right now
• $10,000 in these ASX dividend shares pays how much passive income?

Motley Fool contributor James Mickleboro has positions in Accent 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 Accent Group, CAR Group Ltd, IPH Ltd , and Premier Investments. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

Yesterday afternoon, Zimplats Holdings Ltd (ASX: ZIM) announced a strong quarterly report, highlighting a 22% jump in 6E metal in final product and a 6% reduction in cash operating costs per ounce compared to the prior quarter.

What did Zimplats report?

• Ore mined rose 5% quarter-on-quarter and 15% year-on-year to 2,124,000 tonnes.
• Ore milled increased by 3% from the previous quarter and 12% on the prior comparable period.
• 6E metal in final product jumped 22% quarter-on-quarter to 174,229 ounces, up 35% year-on-year.
• Operating cash cost per 6E ounce fell 6% from the previous quarter to US$1,009, but was 8% higher year-on-year.
• Total operating cash costs increased by 4% to US$170 million compared to the prior quarter.
• Two lost-time injuries were recorded during the quarter.

What else do investors need to know?

The improvement in mined and milled volumes was supported by better underground equipment reliability and higher open pit output. 6E head grade was steady compared to the last quarter, but fell 3% from a year ago due to changes in ore sources.

Major capital projects are progressing well, including the Mupani mine development, which is on track for full-scale production by FY2029, and the smelter expansion where cumulative spending has reached US$466 million. Zimplats also advanced its solar generation project, aiming for 80MW capacity by mid-2027.

What’s next for Zimplats?

Looking ahead, Zimplats plans to maintain its focus on safety improvements and operational efficiency. Continued investment in growth projects, like the Mupani mine and expanded renewable energy, positions the company well for long-term production growth and cost management.

Management has also highlighted strong progress on expanding its tailings storage and base metal refining capabilities, supporting future operational stability. Investors may want to watch for updated guidance and further project milestones in the coming quarters.

Zimplats share price snapshot

Over the past 12 months, Zimplats shares have risen 91%, outperforming the S&P/ASX 200 Index (ASX: XJO) which has risen 4% over the same period.

View Original Announcement

The post Zimplats quarterly earnings: production up, costs down, projects on track appeared first on The Motley Fool Australia.

More reading

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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.

Easy access to international shares and commodities are key reasons why Aussie investors love ASX exchange-traded funds (ETFs).

On top of that, they provide great diversification in just one trade, and there is plenty of choice, with 423 of them on the market today.

In 2025, Aussies sank a net $53 billion into ASX ETFs, which represents a 75% increase on 2024.

Investors understand that ETFs tend to be slower-moving that individual shares, given they reflect the collective performance of a basket of stocks.

But 40% to 70% returns in a single year are highly impressive.

Let’s explore three ASX ETFs that delivered this remarkable range of returns last year.

Global X Gold Bullion ETF (ASX: GXLD)

Last year, Global X Gold Bullion ETF returned 73.8% to investors amid another stupendously good year for the yellow metal.

The gold price rose by 65% in 2025 — its best year for growth since 1979 — and that was on top of a 27% gain in 2024.

Reflecting this run, GXLD has delivered an impressive three-year average return of 28.14%, but a weaker (though still very solid!) five-year average of 16.21%.

In 2026, the gold price has gone even crazier. It’s already up 24% in the year to date, and we’re still in January.

The gold price has exceeded all previous forecasts for 2026, rising close to US$5,600 per ounce during the week.

Gold has a variety of tailwinds, including a structural shift by central banks to diversify away from the USD, ongoing geopolitical tensions, expectations of lower interest rates in the US, and uncertainty over the medium- to long-term impact of US tariffs rolled out last year.

GXLD offers investors a simple and cost-effective way to invest in physical gold.

The ETF tracks the price of gold bullion in Australian dollars, before fees and expenses.

The management fee is 0.15% and there is $617 million worth of assets under management.

As physical gold is a non-yielding investment, the GXLD does not pay dividends.

Betashares Global Banks Currency Hedged ETF (ASX: BNKS)

Last year, Betashares Global Banks Currency Hedged ETF returned 46.54% to investors.

The goal of this ETF is to allow Aussie investors to diversify outside of our Big Four, led by Commonwealth Bank of Australia (ASX: CBA).

The BNKS ETF invests in the world’s largest banks outside of Australia, including JP Morgan, Bank of America, and HSBC.

This ASX ETF tracks the Nasdaq Global ex-Australia Banks Hedged AUD Index.

Hedging is a useful tool at the moment given the weakening USD against the AUD.

The main geographical skews are United States 28%, Canada 15%, Britain 11%, and Japan 9%.

This ETF has got some long-term game. It’s three-year average return is 29.31% and the five-year average is 20.27%.

BNKS has $157 million in net assets and the management fee is 0.57%.

Global X Semiconductor ETF (ASX: SEMI)

In 2025, Global X Semiconductor ETF returned 43.7% to investors.

This ASX ETF tracks the Solactive Global Semiconductor 30 Index. As the name suggests, there are just 30 stocks involved here.

The three-year average return is 48.53%, reflecting surging demand for semiconductors and microchips to power artificial intelligence and advanced technology systems in recent years.

As my colleague Aaron explains, semiconductors control electricity – sometimes they let electricity flow, sometimes they block it.

This makes them essential components in modern electronics.

Semiconductors are used to make microchips, which power iPhones, cars, medical devices, and plenty of other things.

Aaron describes them as the “brains and nerves” of electronic devices.

As you’d expect, the world’s biggest semiconductor manufacturer, Taiwan Semiconductor Manufacturing Company, and semiconductor designer Nvidia Corp, are two of the biggest holdings in this ETF’s portfolio.

This ASX ETF has $559 million in funds under management and the fee is 0.45%.

The post 3 ASX ETFs that delivered 43% to 73% last year appeared first on The Motley Fool Australia.

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• Own DTEC or SEMI ETFs? Here’s why it’s a big day for you
• Global X announces dividends for DTEC, WIRE and other ASX ETFs
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Bank of America is an advertising partner of Motley Fool Money. HSBC Holdings is an advertising partner of Motley Fool Money. JPMorgan Chase is an advertising partner of Motley Fool Money. 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 JPMorgan Chase, Nvidia, and Taiwan Semiconductor Manufacturing. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has recommended HSBC Holdings. The Motley Fool Australia has recommended Nvidia. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

Yesterday afternoon, Deterra Royalties Ltd (ASX: DRR) reported December quarter revenue growth, with MAC iron ore royalties up 15% and strong progress at its lithium portfolio.

What did Deterra Royalties report?

• Total portfolio revenue: $62.9 million for the December quarter, up 16% on the previous quarter
• Mining Area C (MAC) royalties: $62 million, up 15% quarter-on-quarter on record sales volumes
• Other royalties: $0.9 million, a rise from $0.3 million in the prior quarter
• First US$435 million draw down received for Thacker Pass lithium project
• No interim dividend declared in this update
• Jason Neal appointed as interim Managing Director and CEO

What else do investors need to know?

The company’s flagship MAC asset delivered record iron ore sales this quarter, with production rising 10% and prices improving by 6% to an average of $143 a tonne. This underpinned the solid revenue growth for Deterra, which receives a revenue royalty from BHP’s Mining Area C operations.

On the lithium front, the Thacker Pass project in Nevada reached a significant milestone with the first US$435 million drawdown from a US Department of Energy loan, helping accelerate construction. The project remains on track for first lithium carbonate production by the end of 2027.

Outside these two core assets, Deterra has early-stage royalty interests in several North American battery metals projects. Highlights include Anson Resources’ Paradox Lithium Project, where offtake and partnership developments continue to progress.

What did Deterra Royalties management say?

Interim Managing Director and CEO Jason Neal said:

The quarter showcased the strong, consistent cashflow from our foundation asset, MAC, underpinned by record quarterly sales, as well as a strong pricing environment.

Throughout the quarter, the Thacker Pass Lithium Project continued to advance toward first production and cashflow on our royalty. Project development is tracking well against the late CY27 target of first lithium carbonate production. The US$435 million First Draw of the DOE Loan, and the equity positions taken by the DOE in LAC and the JV, provide pathways for the JV operators to accelerate the production timeline and reinforces the US government’s support of Thacker Pass as a project of strategic importance.

With our strong balance sheet, we will continue to drive value from our core MAC and Thacker Pass royalties and earlier stage royalty assets, while also diligently pursuing opportunities for royalty investments and financing through the strict lens of shareholder value creation.

What’s next for Deterra Royalties?

Looking ahead, Deterra will continue to benefit from the stable cash flows generated by its MAC iron ore royalty and the ongoing development of the Thacker Pass lithium project. With construction at Thacker Pass progressing and first lithium production targeted for late 2027, Deterra is well positioned to participate in the global energy transition.

Management says Deterra will also focus on actively seeking new royalty investment opportunities to diversify and grow its earnings base, always with a clear focus on shareholder value.

Deterra Royalties share price snapshot

Over the past 12 months, Deterra Royalties shares hav risen 4%, which is in line with the S&P/ASX 200 Index (ASX: XJO).

View Original Announcement

The post Deterra Royalties posts higher Q2 revenue as MAC iron ore shines appeared first on The Motley Fool Australia.

More reading

• Zimplats quarterly earnings: production up, costs down, projects on track
• These were the best-performing ASX 200 shares in January
• Here are the top 10 ASX 200 shares today
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• Nickel Industries cements leadership in ENC, welcomes Sphere as strategic partner

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.

Last week, ASX materials stock Champion Iron Ltd (ASX: CIA) released its third quarter FY2026 result.

The miner delivered record quarterly sales and income for the three months to 31 December 2025.

It reported: 

• Quarterly revenue of $472 million, up 30% year-over-year
• Net income of $65 million; earnings per share of $0.12
• EBITDA of $152 million, up 73% from the prior-year period
• Record iron ore sales of 3.9 million dry tonnes, an 18% increase
• C1 cash cost per tonne lowered to $73.9, down 6% from a year ago
• Cash balance (excluding restricted funds) of $245 million at quarter-end

However following these results, investors exited their positions, with Champion Iron losing 3.13% on Friday. 

ASX materials stocks have been firing over the last year.

The S&P/ASX 200 Materials (ASX: XMJ) is up 40% in that span. 

However Champion Iron has largely missed out on this bull market, rising just 5.95% in that same period. 

Fresh analysis from Bell Potter

The team at Bell Potter released a new report on this ASX materials stock on Friday. 

Key takeaways from the previous quarter from the broker included: 

• Production & sales: Strong quarterly production and record sales, with higher plant recoveries offsetting harder ore; improved rail performance drove a material reduction in site and port inventories.
• Pricing: Realised prices broadly stable vs index, though still impacted by higher exposure to discounted spot iron ore sales ahead of DRPF term contracts.
• Costs: Unit costs improved quarter-on-quarter, reflecting lower maintenance subcontractor costs and fixed-cost leverage from higher volumes.
• Cash flow: Cash declined C$80m QoQ to C$245m; operationally near breakeven pre-growth capex and dividends, with working capital a drag due to higher receivables and lower payables.

The broker also said a critical decision during the previous quarter was the announcement of a US$289m transaction agreement to acquire Rana Gruber ASA. 

Rana Gruber is a producer of high-grade iron ore operating in Norway’s Dunderland Valley with production of over 1.8Mtpa and five year average trailing EBITDA of US$80m (US$50m in 2024). 

The transaction is expected to close by mid-2026 and will be funded via a US$100m private placement to investment group Caisse de dépôt et placement du Québec and a fully committed US$150m term loan with Scotiabank. 

Bell Potter said transaction benefits include increased scale, diversification, blending capabilities, and EBITDA and cash flow per share accretion.

Hold recommendation

This ASX materials stock closed trading last week at $5.88 per share. 

In Friday’s report, Bell Potter maintained its hold recommendation. 

The broker also lowered its price target to $5.55. 

Based on this rating it appears Friday’s sell-off was justified as this stock is trading slightly above fair value. 

The price target from the broker indicates a downside of approximately 5.6%. 

The post Why did this ASX materials stock tumble after reporting record profits? appeared first on The Motley Fool Australia.

More reading

• Champion Iron posts record iron ore sales and profits in Q3 FY26
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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.

Next week is looking like it could be a big one for Aussie mortgage holders, with the Reserve Bank of Australia (RBA) making its latest interest rate decision.

Due to recent economic data, there is speculation that the central bank will increase rates on Tuesday. But is that the case? Let’s find out.

What will the RBA do with interest rates next week?

Unfortunately for borrowers, the market believes there is more chance of a rate hike next week than not.

According to the latest ASX 30 Day Interbank Cash Rate Futures February 2026 contract, the market is pricing in a 67% probability of a 25 basis point increase to 3.85%.

The team at Westpac Banking Corp (ASX: WBC) agrees with the market and believes that recent economic data points to a rate hike at next week’s meeting.

Commenting in the bank’s weekly economic report, Westpac’s chief economist, Luci Ellis, who used to work as assistant governor at the RBA, said:

When the economy is close to full employment and full capacity utilisation, it is hard to know which side of the line it is on. Inflation outcomes are the best guide in this situation. This is one reason why inflation gets the ‘casting vote’ at the RBA’s February meeting. With trimmed mean as the clearest signal of the underlying inflation trend, the 0.9%qtr, 3.4%yr quarterly result in the December quarter implies that the RBA is likely to raise rates at the February meeting.

However, Ellis notes that there is still a small chance that interest rates could be kept on hold. She adds:

There is still a small chance they hold (though it would be a split decision), and we expect the Board to debate the merits of holding versus raising the cash rate at the meeting. We are mindful of the messaging via the media that the RBA would hike if trimmed mean inflation remained above its 2–3% target and was drifting further away from the desired midpoint (our emphasis).

The run of quarterly data might not quite meet the second part of that test, though the case can be made that it does. There are also arguments to be cautious given that the new monthly collection has made the inflation data harder to interpret. But with market and public expectations already primed, the Board is likely to see little reason to wait.

What’s next for rates?

The good news is that Westpac believes this is where the rate hikes stop.

It is forecasting interest rates to stay on hold at 3.85% through to late 2027, before starting to retreat to 3.35% by early 2028.

The post Here’s what Westpac says the RBA will do with interest rates next week 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.

I think ASX growth shares that are delivering rising earnings and increasing payouts can be very attractive investments.

It’s wonderful to own businesses where the share price rises, but if the company doesn’t pay dividends, then our bank account doesn’t benefit until we sell.

I like that we can own growing companies that send some of their profits to shareholders each year in the form of dividends. In five years, the dividend payouts from these businesses could have grown dramatically, combined with potentially exciting capital growth.

Let’s dive in.

Lovisa Holdings Ltd (ASX: LOV)

Lovisa describes itself as a fashion-forward jewellery brand that caters to everyone.

It has at least 10 stores in numerous countries including Australia, the USA, Canada, the UK, France, Germany, Belgium, the Netherlands, Poland, Italy, Ireland, Singapore, Malaysia and South Africa.

The company’s addressable market is huge. It has close to 1,100 stores in total, but Australia (over 180 stores) and the USA (around 230 stores) are the only two locations that have more than 100. It can expand for many years in existing countries (such as Canada, the UK, China and Germany) as well as entering new markets.

While the growth rate in total sales won’t directly match net profit growth or dividend growth, I think the outlook for all financial metrics is very promising.

The projections on Commsec suggest the business could decide on a dividend payout ratio that’s close to 100%, as it has done in the last few years, unlocking a powerful dividend yield for investors.

The FY26 projection on Commsec suggests the ASX growth share is trading (at the time of writing) at 29x FY26’s estimated earnings with a possible dividend yield of 3.1%, excluding any franking credits benefits. The FY28 forecasts suggest the business is trading at under 23x FY28’s estimated earnings, with a possible dividend yield of 3.7%, excluding franking credits.

Pinnacle Investment Management Group Ltd (ASX: PNI)

I think Pinnacle is one of the most underrated businesses on the ASX in terms of its dividend potential.

When it comes to dividend potential, I think investors should evaluate both the current yield and the potential for regular dividend growth.

Before we get to the possible dividends, I’ll mention what it does. It invests in promising funds management businesses, taking a minority stake and helping them grow. There are numerous services it can provide to help the fund manager focus on investing, which includes compliance, legal, client distribution, seed funds under management (FUM), working capital and more.

You may recognise some of the fund managers in the ASX growth share’s portfolio, such as Spheria, Solaris, Resolution Capital, Plato, Palisade, Pacific Asset Management, Metrics, Firetrail, Five V, Coolabah Capital, Antipodes and Aikya.

According to the forecast on Commsec, it’s expected to deliver a grossed-up dividend yield of around 5.75%, including franking credits. By FY28, the grossed-up dividend yield could be 8.4%, including franking credits.

One of the key reasons the business has strong growth potential is because of the ongoing FUM growth of the fund managers.

In the three months to 30 September 2025, its FUM grew to $197.4 billion, an increase of $18 billion (or 10%) from $179.4 billion at 30 June 2025.

Of that increase over the three months, $13.3 billion of the rise related to net inflows over the period. Within that total, $4 billion were Australian retail net inflows, $2.9 billion was international net inflows and $6.4 billion was Australian institutional net inflows. This shows broad success for the company.

If Pinnacle’s total FUM continues rising in the double-digits in percentage terms, then the ASX growth share has a very promising future for dividends and profit growth.

The post 2 ASX growth shares I’d buy today for growth and income appeared first on The Motley Fool Australia.

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• How to turn ASX dividends into long-term wealth

Motley Fool contributor Tristan Harrison has positions in Pinnacle Investment Management Group. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Lovisa and Pinnacle Investment Management Group. The Motley Fool Australia has positions in and has recommended Pinnacle Investment Management Group. 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 S&P/ASX 200 Index (ASX: XJO) was on form in January and pushed higher. The benchmark index rose 1.8% over the month.

While this was positive, some ASX 200 shares rose significantly more. Here’s why these were the best performers on the index in January:

Deep Yellow Ltd (ASX: DYL)

The Deep Yellow share price was the best performer in January with a gain of 54%. This was driven by the release of a solid quarterly update and improving sentiment in the uranium sector. For similar reasons, fellow uranium producers Paladin Energy Ltd (ASX: PDN) and Boss Energy Ltd (ASX: BOE) rallied strongly in January. They recorded gains of 44% and 33%, respectively.

Codan Ltd (ASX: CDA)

The Codan share price was on form and raced 34% higher in January. This metal detector and communications products company’s shares jumped following the release of a trading update. Codan revealed that it expects to report a 29% increase in revenue to $394 million for the first half of FY 2026. And thanks to margin expansion, its profit after tax is expected to grow at the even quicker rate of 52% to at least $70 million. This strong growth was underpinned by “outstanding results achieved by the metal detection business and ongoing strong performance in the communications segment.”

Iperionx Ltd (ASX: IPX)

The Iperionx share price wasn’t far behind with a gain of 31% during the month. A catalyst for this was news that the titanium metal and critical materials company received a prototype purchase order valued at US$300,000 from American Rheinmetall. The order is for 700 lightweight titanium components for US Army heavy ground combat systems. IperionX’s CEO, Taso Arima, said: “This purchase order demonstrates the practical application of IperionX’s recycled titanium technologies on important U.S. ground combat platforms. As the only domestic producer of commercial primary titanium, IperionX is uniquely positioned to support domestic defense priorities with secure, low-carbon, and cost-competitive titanium products manufactured entirely in the United States.”

South32 Ltd (ASX: S32)

The South32 share price was on form and raced 30% higher in January. This was driven by the release of the mining giant’s first half update. South32 revealed a 3% increase in alumina production, a 2% lift in aluminium production, and a 58% jump in manganese production. The miner’s CEO, Graham Kerr, said: “We continued to deliver consistent operating results, with FY26 production guidance maintained across our operated assets and first half operating unit costs tracking in line with guidance.”

The post These were the best-performing ASX 200 shares in January 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.

Choosing the right ASX shares can be key to unlocking a large dividend yield that’s much more appealing for passive income than money in the bank. Some businesses offer yields of more than 9%!

But I wouldn’t buy any business for passive income just because it has a good yield. Dividends can be cut, so it’s important to consider what will help the business continue that dividend streak.

I’d also want to see that the business has a history of not cutting the dividend. Past reliability is not a guarantee, but it’s a useful indicator of what can happen during different economic conditions.

WAM Microcap Ltd (ASX: WMI)

This is a listed investment company (LIC) that’s operated by the team at Wilson Asset Management (WAM). It’s focused on finding the best opportunities in the ASX small-cap share end of the market.

The ASX share’s FY25 payout translates into a grossed-up dividend yield of just over 9% (at the time of writing), including franking credits, which was a slightly higher payout than the FY24 dividend.

It has been very consistent: it increased its regular annual payout each year between FY18 and FY23, maintained it in FY24, and then hiked it again in FY25. In other words, there have been no dividend cuts in its existence.

WAM Microcap has managed to fund its dividend thanks to the investment returns its portfolio has generated. At the end of December 2025, its portfolio had returned an average return per year of 16.7% since inception in June 2017, before fees, expenses, and taxes.

It already has a profit reserve of around five years of dividends at the current level, and I think it can continue funding slightly bigger payouts. The small end of the share market is compelling for finding investment opportunities due to its growth potential.  

Shaver Shop Group Ltd (ASX: SSG)

Shaver Shop is one of Australia’s underrated ASX dividend shares, in my opinion.

It retails a wide array of hair removal products in Australia and New Zealand, with both male and female products across its store network and website.

Shaver Shop increased its payout each year from 2017 to 2023, maintained the dividend in FY24, and then increased it slightly in FY25. Its FY25 grossed-up dividend yield is around 9.5% at the time of writing, including franking credits.

I think the business has quite defensive earnings – hair grows in all economic conditions. That makes for consistent demand for its products, in my view.

Shaver Shop is one of the leaders in hair removal retailing, which is why multiple shaving brands have agreed to exclusive products with the business. This helps the ASX share provide unique products and deliver a stronger gross profit margin.

Shaver Shop is also working hard at expanding its own brand called Transform-U, helping it fill in different products across its overall range, which means a stronger gross profit margin on those sales.

It can grow earnings as it expands its store network, sells more online, and expands its Transform-U range.

The post 2 ASX shares to buy with dividend yields above 9% appeared first on The Motley Fool Australia.

More reading

• Here’s how you could turn the stock market into a $1,000 monthly passive income machine
• This 9% yield is one I’m comfortable holding for the long term
• If a 25-year-old invests $1,250 a month in ASX stocks, here’s what they could have by retirement
• 3 great ASX dividend shares to buy in 2026
• Get paid huge amounts of cash to own these ASX dividend stocks

Motley Fool contributor Tristan Harrison has positions in Wam Microcap. 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 Shaver Shop Group. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.