Coles Group Ltd (ASX: COL) has outperformed the S&P/ASX 200 Index (ASX: XJO) in 2026, with its shares up around 12% this year.

At approximately $24.05, they are now trading close to a record high.

So, after that run, is there still value left for investors?

The price reflects high expectations

Coles is not trading like a bargain. According to CommSec, consensus earnings per share forecasts stand at 98.2 cents in FY27, $1.05 in FY28, and $1.15 in FY29.

At the current share price, that puts Coles on a P/E ratio of roughly 24.5 times forecast FY27 earnings.

I think investors are clearly being asked to pay a premium for the predictability and quality of the business.

But the multiple becomes easier for me to accept when I look further ahead. If earnings reach $1.15 per share in FY29, the current price represents around 21 times those forecast profits.

That gradual improvement is a big part of why I still see value here.

Coles has ways to improve what it already has

The growth story does not depend on Australians suddenly buying far more groceries.

Coles has spent heavily on automation across its distribution and online fulfilment operations. I think the next few years can increasingly be about extracting benefits from those investments.

Moving products through the network more efficiently can help with costs and availability, while automated fulfilment gives Coles more capacity to handle online orders as shopping habits continue changing. That is an attractive position for a mature retailer.

Additionally, with its FY26 results this month, Coles said it is accelerating investment in its new store and renewal programs, as well as priority data and technology initiatives, over the next two years.

This includes opening approximately 45 new supermarkets in infill locations and high-growth corridors, as well as the renewal of approximately 150 supermarkets.

Income could rise with earnings

The dividend forecasts also point in a positive direction. Consensus estimates are for fully-franked dividends per share of 83.5 cents in FY27, 88.8 cents in FY28, and 97.4 cents in FY29. This represents dividend yields of 3.5% to 4%.

I would not buy Coles purely for income, particularly at the current share price.

But I like seeing dividend growth alongside the expected increase in earnings. It gives shareholders another way to benefit if the company delivers on the current outlook.

What could go wrong?

A premium valuation leaves less room for disappointment.

Competition with Woolworths Group Ltd (ASX: WOW) and Aldi remains strong, while cost pressures or weaker execution could make achieving the expected earnings growth harder.

That is why I would view Coles as a quality business at a reasonable price rather than a cheap share.

Foolish takeaway

The recent rally has certainly made Coles less attractive than it was at the start of the year.

Still, I think the next few years could justify the premium investors are paying today. Earnings are forecast to keep rising, dividends are expected to follow, and Coles has already made major investments that could improve how efficiently the business operates.

At around $24.05, I still see enough long-term value to consider Coles a buy.

The post Up 12%: Is there still value in Coles shares? 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 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.

BHP Group Ltd (ASX: BHP) shares are edging lower today, which could offer an opportune buying opportunity.

Shares in the S&P/ASX 200 Index (ASX: XJO) mining giant closed on Friday trading for $67.30. In morning trade on Monday, shares are swapping hands for $66.55 apiece, down 1.1%.

For some context, the ASX 200 is just about flat at this same time.

Taking a step back, one year ago, you could have bought BHP shares for just $42.70 apiece. You’d then have enjoyed the whopping 55.9% share price gains over the past 12 months.

And that doesn’t include the two fully-franked BHP dividends, totalling $2.431 a share, that the miner has paid (or shortly will pay) for the full 2026 financial year (FY 2026).

At the current share price, BHP stock trades on a fully-franked dividend yield (partly trailing and partly pending) of 3.7%.

And looking ahead, Morgans’ Damien Nguyen forecasts more outperformance to come from Australia’s biggest miner and the biggest stock on the ASX by market cap (courtesy of The Bull).

Here’s why.

Should I buy BHP shares today?

“BHP offers exposure to a portfolio of high-quality mining assets and remains well positioned to benefit from long term demand for copper and other critical minerals,” Nguyen said.

Citing the first reason you might want to buy BHP shares today, he said, “A strong operating performance, healthy cash generation and a disciplined approach to capital allocation continue to support the investment case.”

Nguyen added:

BHP appeals for potential capital growth, income and for diversified resources exposure. The company posted an attributable profit of US$9.8 billion in full year 2026, up 9% on the prior corresponding period. Revenue of US$58.8 billion was up 15%.

Then there’s BHP growing investment and returns from its copper mining operations.

“While iron ore remains important, increasing copper exposure provides leverage to electrification and decarbonisation trends,” Nguyen said.

Indeed, for FY 2026, the ASX 200 miner reported a 48% year-on-year increase in underlying earnings before interest, taxes, depreciation and amortisation (EBITDA) from its copper division to US$18.2 billion.

That represented 54% of the miner’s full-year earnings. And it marked the first time its copper division accounted for the majority of BHP’s full-year earnings, taking that mantle from its iron ore operations.

As for the third reason you might want to buy BHP shares today, Nguyen concluded, “BHP recently declared a final fully franked dividend of 99 US cents a share.”

That equates to AU$1.392 per share (according to CommSec).

And that final passive income payout is still up for grabs.

If you want to bank the final BHP dividend, you’ll need to own shares at market close on Wednesday, 2 September. BHP trades ex-dividend on Thursday. You can then expect to be paid on 23 September.

The post Up 56%! 3 reasons to still buy BHP shares today appeared first on The Motley Fool Australia.

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Motley Fool contributor Bernd Struben has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has recommended BHP Group. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

Rio Tinto Ltd (ASX: RIO) has had a strong run, but I still think there is a good reason to look at the shares today.

For me, the investment case is increasingly about what the business could look like several years from now.

At around $178.04, I would be happy to buy.

I am comfortable with the price

According to CommSec, consensus earnings per share forecasts stand at $12.07 in FY26 and $12.04 in FY27.

Clearly, analysts are not expecting much earnings growth in the near term.

But at the current share price, Rio Tinto is trading at just under 15 times forecast earnings. I think that is a reasonable multiple for a global miner with several major assets that could become increasingly important over the years ahead.

Mining earnings rarely move smoothly. Commodity prices can rise and fall considerably, so I would not expect Rio Tinto to deliver predictable annual growth like a software company.

Instead, I am interested in whether today’s investments can leave it producing more of the commodities the world needs in 5 or 10 years.

The business is gradually changing

Iron ore remains enormously important to Rio Tinto, but I think copper could become a much bigger part of how investors view the company.

Oyu Tolgoi in Mongolia is central to that opportunity.

The underground operation is still ramping up and is expected to turn Oyu Tolgoi into one of the world’s largest copper mines. That gives Rio Tinto a substantial source of additional production without needing copper prices alone to drive future growth.

I like the timing. Copper is needed across electricity grids, renewable energy, data centres, electric vehicles, and wider electrification. Developing major new mines can take many years, which could make high-quality existing and emerging supply increasingly valuable.

Rio Tinto also has other copper opportunities in its pipeline, giving the company more than one potential route to increase its exposure.

For me, this longer-term story is more important than whether earnings move slightly higher or lower between FY26 and FY27.

Investors are being paid along the way

There is also a healthy income component. Consensus forecasts are for fully-franked dividends of $6.64 per share in FY26 and $6.62 in FY27.

I think receiving substantial, fully-franked dividends while Rio Tinto develops its copper operations adds to the appeal of holding the shares patiently.

Of course, dividends from miners can move significantly with commodity prices and earnings, so I would never treat those forecasts as guaranteed.

Foolish takeaway

I think it is a good time to buy Rio Tinto shares.

The near-term growth forecasts are hardly exciting, but I do not think they capture the strongest part of the investment case.

At around 15 times forecast earnings, I believe investors are paying a reasonable price for a major global miner whose production mix could become increasingly attractive as copper’s importance grows.

I would be happy to buy Rio Tinto today and give that story several years to develop.

The post Is it a great time to buy Rio Tinto shares? 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 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.