Tag: Stock pick

The Challenger Ltd (ASX: CGF) share price is in focus today after the company announced it will redeem all outstanding Challenger Capital Notes 3 on 25 May 2026, returning $100 per note in cash to holders. Investors will also receive a final fully franked distribution of $1.47 per note, expected to be paid on the same date.

What did Challenger report?

• All outstanding Challenger Capital Notes 3 to be redeemed for $100 per note on 25 May 2026
• Final fully franked distribution of $1.47 per note to be paid on 25 May 2026
• Record date for final distribution set as 15 May 2026
• Redemption approved by Australian Prudential Regulation Authority (APRA)
• Last trading day for Challenger Capital Notes 3 expected to be 13 May 2026

What else do investors need to know?

Challenger’s decision to redeem the Capital Notes 3 has been approved by APRA, with the company emphasising that this does not signal a future intent to redeem other capital instruments. Any similar future decisions would also require separate APRA approval.

The payment of the final distribution and redemption proceeds is subject to standard conditions, specifically that no payment condition exists on the date. If these conditions are met, holders on the record date will receive their payment on 25 May 2026.

What’s next for Challenger?

With this redemption, Challenger is simplifying its capital structure and returning funds to noteholders. The company has stated this move is in line with established terms and current capital management plans.

Challenger’s ongoing focus remains on providing financial security for clients in retirement, through its Funds Management and Life divisions. There is no indication of further redemptions planned for other capital instruments at this time.

Challenger share price snapshot

Over the past 12 months, Challenger shares have risen 22%, outperforming the S&P/ASX 200 Index (ASX: XJO) which has risen 15% over the same period.

View Original Announcement

The post Challenger plans 2026 redemption of Capital Notes 3 with final distribution appeared first on The Motley Fool Australia.

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• Lynas Rare Earths shares in focus after record revenue and new supply deals
• Rio Tinto Q1 FY26: Production growth and steady guidance drive optimism
• HUB24 grows Q3 inflows and funds under administration
• Cleanaway Waste Management shares in focus as strategy refresh targets margin growth

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 recommended Challenger. 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.

Regardless of one’s feelings towards the current occupant of the White House, it’s fair to say that the United States’ historic role as the leader of the free world is at its lowest ebb since at least the end of the Second World War. With faith in the United States as a global leader waning, could investing in Chinese shares be a prudent move for ASX investors? If so, the iShares China Large- Cap ETF (ASX: IZZ) might be an easy way to do it.

For more than 70 years, the US has been at the centre of the global financial system. Even after the US-dictated ‘Bretton-Woods’ gold standard collapsed in the 1970s, the vast majority of world trade has, and continues to occur, in US dollars.

However, many investors are asking how long American dominance of the financial system will continue. US President Donald Trump has made no secret of his disdain for multilateral forums like NATO, the United Nations (UN), and the International Monetary Fund (IMF), viewing them through his ‘America First’ ideology as unnecessary drains on American resources.

If American power and influence on the international stage does decline, the logical heir, at least in many minds, is China.

China is the world’s second-largest economy and has made no effort to hide its own superpower ambitions. China already dominates several future-facing industries, including electric vehicles, rare earths processing, and renewable energy.

So, is now the time to invest in China?

One of the easiest ways to do so from the ASX is through the iShares China Large-Cap ETF. This exchange-traded fund (ETF) holds a basket of 50 of the largest Chinese stocks. These stocks are dominated by China’s largest tech titans, including Alibaba, Tencent, and Xiaomi. These companies currently make up 9.01%, 8.16%, and 7.97% of IZZ’s portfolio, respectively. Other names that might be familiar to readers include carmaker BYD and food delivery giant Meituan.

If an ASX investor wishes to invest in China, this ETF provides one of the simplest paths.

Is IZZ a buy today?

This ASX ETF might prove to be a long-term winner for ASX investors, particularly if the US does continue to bleed power and influence to China.

However, I won’t be buying it.

I happen to take Warren Buffett at his word when he tells us to ‘never bet against America’. Sure, the America of 2026 is not the same America that most of us grew up with. However, I think this country’s long history of innovation and open markets will continue to enable it to produce the best companies in the world. Plus, for all we know, the US could elect a very different President in 2028.

Right now, that is certainly the case. China may have some impressive companies. But none, at least in my view, can rival Apple, Microsoft, Nvidia, Amazon, Alphabet, Coca-Cola, Tesla, Netflix, and many, many others in terms of global reach and dominance.

China does not have the political polarisation of America. But it is also a country that coerces its companies to place loyalty to the Chinese state above its shareholders’ interests, and to obey the central government’s every whim. That’s not something that many investors in Australia would welcome, I’d wager. It does not technically even allow non-citizens to directly own shares of Chinese companies (look it up).

As such, I would rather put my money in a country that values financial transparency and has always been the home of the world’s best businesses. Its politics might be volatile. But the American financial system remains the central pillar of the global economy. As such, I’m listening to Uncle Warren on this one.

The iShares China Large- Cap ETF charges a management fee of 0.6% per annum. As of 31 March, it has returned an average of 5.63% per annum since its 2004 inception.

The post With the US flailing, is it time to buy the iShares China Large-Cap ETF (IZZ)? appeared first on The Motley Fool Australia.

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Motley Fool contributor Sebastian Bowen has positions in Alphabet, Amazon, Apple, Berkshire Hathaway, Coca-Cola, Microsoft, and Netflix. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Alphabet, Amazon, Apple, Berkshire Hathaway, Microsoft, Netflix, Nvidia, Tencent, and Tesla and is short shares of Apple. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has recommended Alibaba Group and BYD Company. The Motley Fool Australia has recommended Alphabet, Amazon, Apple, Berkshire Hathaway, Microsoft, Netflix, and Nvidia. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

The ASX-listed exchange-traded fund (ETF) VanEck Morningstar Wide Moat ETF (ASX: MOAT) has been a great investment to own for the long-term and there are still plenty of reasons to believe it can deliver good returns from here.

For starters, I should mention that the fund is invested in US-listed businesses. So, for Australian investors who have little exposure to overseas share markets, I think this is a good option to consider for international diversification purposes.

Its portfolio – which is regularly shifting its holdings – has delivered an average return per year of 14.7% over the last decade.

I reckon many Aussie investors would be happy if their portfolio delivered an average return per year of more than 14% over the prior decade.

There are a couple of aspects that help this ASX ETF deliver such strong returns.

Strong economic moats

The fund says it focuses on quality US companies that Morningstar (an investment research outfit) believes possess sustainable competitive advantages, or wide economic moats.

Competitive advantages can come in a variety of different forms such as cost advantages, intangible assets (patents, brands or regulatory licenses) that keep competitors at bay, switching costs, network effects, efficient scale and so on.

It’s good to have a competitive advantage because that may be what wins a customer.

But, the ASX ETF wants to find businesses that have sustainable competitive advantages. In other words, it wants to see that these advantages will endure for a long time rather than having an economic moat they may not last that long.

VanEck and Morningstar explain how a business can claim to have a wide economic moat:

For a company to earn a wide economic moat, excess normalised returns must, with near certainty, be positive 10 years from now. In addition, excess normalised returns must, more likely than not, be positive 20 years from now.

In other words, these businesses could generate good profits and margins for many years to come.

Great value

The MOAT ETF only invests in these great businesses when they’re at a good price.

It targets companies that are trading at attractive prices compared to what Morningstar’s estimate of fair value.

At the moment, the ASX ETF’s biggest positions currently include Constellation Brands, Brown-Forman, Airbnb, Nvidia and Bristol-Myers Squibb.

That combination of buying great businesses at good prices is a winning formula and it has clearly generated good returns over the long-term as it picks great ideas from a variety of sectors.

The post This ASX ETF has generated returns of almost 15% per year! appeared first on The Motley Fool Australia.

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Motley Fool contributor Tristan Harrison has positions in VanEck Morningstar Wide Moat ETF. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Airbnb, Bristol Myers Squibb, and Nvidia. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has recommended Constellation Brands. The Motley Fool Australia has recommended Airbnb, Nvidia, and VanEck Morningstar Wide Moat ETF. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

The Rio Tinto Ltd (ASX: RIO share price is in focus today after the company posted a 9% year-on-year lift in copper equivalent production for Q1 FY26, powered by copper and iron ore growth and a resilient aluminium performance.

What did Rio Tinto report?

• Copper equivalent production up 9% year-on-year across the portfolio
• Pilbara iron ore production jumped 13% YoY to 78.8 million tonnes (100% basis); sales up 2%
• Group copper production rose 9% to 229,000 tonnes; Oyu Tolgoi ramp-up on track
• Aluminium output increased 1%, with 835,000 tonnes produced
• Bauxite production was down 11% due to weather impacts
• 2026 production and unit cost guidance unchanged across key divisions

What else do investors need to know?

Rio Tinto maintained full-year production and cost guidance for 2026 across all major commodities, despite some weather-related disruptions. The Pilbara iron ore mines delivered their second-best Q1 production since 2018, even as two cyclones reduced shipments by around 8 million tonnes, with about half of the losses expected to be recovered later in the year.

The company reported strong progress on key capital projects. Mechanical completion was achieved at both Fenix 1B and Sal de Vida lithium projects, positioning Rio Tinto for first production in the second half of 2026. Investment in productivity initiatives has already yielded $650 million in annualised benefits, with further improvements underway.

What did Rio Tinto management say?

Rio Tinto Chief Executive Simon Trott said:

Operating excellence drove 9% YoY copper equivalent production growth across our portfolio as the Oyu Tolgoi copper mine continues to ramp up as planned and our integrated aluminium business, again, delivered a strong performance. Our Pilbara iron ore mines performed strongly, while shipments were impacted by two cyclones in the quarter.

What’s next for Rio Tinto?

Looking ahead, Rio Tinto is focused on extending mine life and expanding production across its core commodity assets. Major development projects in iron ore, copper, lithium and aluminium remain on track, with the company’s unique global portfolio providing supply chain resilience. The business is monitoring global geopolitical and commodity market developments closely, particularly in light of the Middle East conflict and its potential impacts in the second half of 2026.

Future-facing growth is supported by new projects in Guinea (Simandou iron ore) and Argentina (lithium), while sustainability and operational productivity remain key priorities. Guidance for 2026 output and costs remains unchanged at this stage.

Rio Tinto share price snapshot

Over the pat 12 months, Rio Tinto shares have risen 55%, outperforming the S&P/ASX 200 Index (ASX: XJO) which has risen 15% over the same period.

View Original Announcement

The post Rio Tinto Q1 FY26: Production growth and steady guidance drive optimism appeared first on The Motley Fool Australia.

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• HUB24 grows Q3 inflows and funds under administration
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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.

The HUB24 Ltd (ASX: HUB) share price is under the spotlight after the company delivered $4.0 billion in platform net inflows for Q3 FY26 and lifted total funds under administration (FUA) to $151.7 billion, up 22% on the prior corresponding period.

What did HUB24 report?

• Platform net inflows of $4.0 billion in Q3 FY26 (up 9% on pcp, excluding large migrations)
• Total FUA reached $151.7 billion as at 31 March 2026 (up 22% on pcp)
• Platform FUA of $127.8 billion (up 25% on pcp), PARS FUA of $23.9 billion (up 11% on pcp)
• Active advisers on the platform rose to 5,549 (up 11% on pcp)
• Awarded Best Platform Overall and Best in Platform Managed Accounts Functionality in industry reports
• Call option exercised to acquire HTFS Nominees Pty Ltd, trustee for the HUB24 Super Fund

What else do investors need to know?

HUB24’s momentum continued into Q3, despite challenging market conditions. Record net inflows were achieved, led by a strong rise in retail and adviser numbers, although there was a one-off outflow from an institutional client in March.

The company continued to innovate, launching new digital adviser solutions and enhancing its high-net-worth and managed portfolio offerings. HUB24’s Class and NowInfinity platforms also saw growth, with active account and document order numbers rising. Notably, NowInfinity has embarked on a multi-year enhancement program to improve user experience and compliance support for finance professionals.

Additionally, the transaction to acquire trustee HTFS Nominees Pty Ltd is progressing, with integration expected by the end of 2026 pending regulatory approvals. This is anticipated to have no material financial impact on earnings.

What’s next for HUB24?

HUB24 is focused on maintaining momentum in its structurally growing markets, supported by demographic trends and compulsory superannuation. The business plans to further invest in product features and technology, deepen adviser relationships, and complete its acquisition of HTFS Nominees.

The company remains confident in its ability to deliver sustained growth over the longer term, with a strong pipeline of opportunities from both new and existing clients.

HUB24 share price snapshot

Over the past 12 months, HUB24 shares have risen 47%, outperforming the S&P/ASX 200 Index (ASX: XJO) which has risen 15% over the same period.

View Original Announcement

The post HUB24 grows Q3 inflows and funds under administration 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 positions in and has recommended Hub24. The Motley Fool Australia has recommended Hub24. 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 shares are a wonderful tool to unlock a significant dividend yield because of a combination of a generous dividend payout ratio and an attractive valuation.

Investors wanting to grow wealth relatively quickly may not necessarily want high levels of passive income because that could mean paying more of the return to the Australian Taxation Office. Capital gains aren’t taxed until an asset is sold.

However, for investors in retirement or who have a low tax rate, ASX dividend shares with a large dividend yield could be a rewarding pick.

Hearts and Minds Investments Ltd (ASX: HM1)

This is one of the high-yield ASX shares that I’ve added to my own portfolio because of the investment exposure and high levels of passive income.

It’s a listed investment company (LIC), meaning it doesn’t sell products or services. Instead, the business has an investment portfolio that it aims to make investment returns with.

Dividends are paid from the positive investment returns, which allows it to pay steadily growing passive income. The company is aiming to increase its payout every six months by 0.5 cents per share.

The next two dividends to be declared should come to a total of 20.5 cents per share, which would translate into a grossed-up dividend yield of 10.3%, including franking credits.

Hearts & Minds donates 1.5% of its portfolio to medical research, it’s able to do that because all of the investment picks are contributed for free by investment experts.

Some of the portfolio is decided by a core group of portfolio managers, while the rest is contributed at an annual investment conference, where some experts pick their best stock idea.

This process results in a largely global portfolio and the recent volatility could mean it’s a compelling time to invest.

Shaver Shop Group Ltd (ASX: SSG)

Shaver Shop is a leading ASX retail share that sells a variety of hair removal products. Considering how important hair removal is for many Australians, I think the business has relatively defensive earnings for a retailer.

The business has benefited from the steady growth of its store network, as well as the expansion of its own brand called Transform-U. Building its own brand can come with higher gross profit margin and stronger control of what products it sells.

But, the ASX dividend share also has a number of exclusive products from quality shaving brands, giving it a unique selling point (USP) for customers.

Pleasingly, the business has grown or maintained its dividend every year since 2017, so we’re almost at a decade of dividend reliability.

The last two half-year dividends come to a grossed-up dividend yield of close to 11%, including franking credits.

The post 2 ASX shares with dividend yields above 8% appeared first on The Motley Fool Australia.

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Motley Fool contributor Tristan Harrison has positions in Hearts And Minds Investments. 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.

ASX All Ords gold stock Aurum Resources Ltd (ASX: AUE) has delivered some outsized gains this past year.

Aurum Resources shares closed on Monday trading for 64 cents apiece. That sees shares in the African-focused gold miner up 67% in 12 months, smashing the 14.5% one-year gains delivered by the All Ordinaries Index (ASX: XAO).

Part of those gains have been spurred by the fast-rising gold price. On Monday, gold was fetching US$4,796 per ounce, up 40% since this time last year.

But the ASX All Ords gold stock has hardly been sitting idle over this time.

And following a significant resource upgrade at one of its core gold mines earlier this month, the team at Canaccord Genuity believe Aurum Resources shares are well-placed to deliver more outsized gains.

Here’s why.

ASX All Ords gold stock growing its resources

On 10 April, Aurum Resources reported a 34% increase in the mineral resource estimate (MRE) at its Napie Gold Project, located in Cote d’Ivoire.

This brought the ASX All Ords gold stock’s total resource base to 4.2 million ounces across its two Cote d’Ivoire gold projects, with 3.03 million ounces at its Boundiali project and 1.16 million ounces at Napie.

Encouragingly, the miner noted that only 13% of the 30-kilometre Napie Shear has been systematically drilled to date. And Aurum is well-funded to continue drilling, with a cash balance of $61 million as at 31 March.

Commenting on the upgraded MRE, Canaccord said:

In our initiation of coverage, our expectation was that AUE could deliver an unrisked addition of 279koz at Napie in the near term. To come within 4% at this juncture is very pleasing and bodes well for further updates

Looking to potential catalysts ahead, Canaccord noted:

Ongoing drilling programs, including 30,000m at Napie and 100,000m at Boundiali, are expected to drive further resource growth, with additional updates planned through 2026. A PFS [pre-feasibility study] for Boundiali is expected later this month.

As for what investors might expect from that PFS, Canaccord said, “We expect the 40.8Mt at 1.0g/t Au for 1.37Moz Indicated resource to underpin 10 years of production at a 6Mtpa run rate. At this scale, Boundiali could sustain 175kozpa.”

On the cost front, the broker estimates that Aurum Resources’ all-in sustaining cost (AISC) could be around US$1,500 per ounce at the current gold price.

Connecting the dots, Canaccord has a speculative buy rating on the ASX All Ords gold stock with a price target of $1.55 a share.

That’s more than 142% above Monday’s closing price.

The post Why this surging ASX All Ords stock is forecast to rocket another 142% 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 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 Cleanaway Waste Management Ltd (ASX: CWY) share price is in focus today as the company unveiled a refreshed 2026 strategy, aiming for margin expansion and stable cash flow, while highlighting a 60% lift in underlying EBIT since FY22.

What did Cleanaway Waste Management report?

• Underlying EBIT rose 60% between FY22 and FY25, with margin expanding 260 basis points to 12.5%
• Return on capital employed improved by 220 basis points to 9.1% from FY22 to FY25
• EBIT margin reached a record 12.5% in FY25
• Free cash flow is expected to strengthen from FY27 onwards as one-off costs wind down
• Dividend payout ratio maintained at 50–75% of underlying NPAT

What else do investors need to know?

Cleanaway’s new “Blueprint 2030 2.0” strategy is built around three pillars: delivering customer value, optimising its branch network, and leveraging advanced ways of working through digital and data capabilities. Management outlined plans to focus on high-value revenue growth, tighter cost controls, and further investment in automation and analytics to drive efficiencies.

Key highlights include a major upgrade to sales processes, with a centralised “One Sales Engine” model designed to lift customer retention and cross-sell rates. The company also flagged its ongoing digitisation program, targeting improved fleet utilisation, real-time tracking, and safety enhancements.

Cleanaway is actively reshaping its hazardous waste business, streamlining its site network while expanding high-margin technical services and decommissioning work—sectors where industry growth is forecast to continue.

What’s next for Cleanaway Waste Management?

Looking ahead, Cleanaway is targeting ongoing margin expansion of at least 260 basis points and 10–15% EPS growth in FY27 as cost-saving initiatives gain traction. The company expects to deliver stronger, more stable free cash flow through disciplined capital allocation and optimised asset utilisation.

Management is confident its integrated network and planned technology investments will continue to underpin Cleanaway’s leadership in sustainable waste management, providing a pathway for profitable growth in critical sectors such as hazardous waste and technical services.

Cleanaway Waste Management share price snapshot

Over the past 12 months, Cleanaway shares have declined 9%, trailing the S&P/ASX 200 Index (ASX: XJO) which has risen 15% over the same period.

View Original Announcement

The post Cleanaway Waste Management shares in focus as strategy refresh targets margin growth appeared first on The Motley Fool Australia.

More reading

• Rio Tinto Q1 FY26: Production growth and steady guidance drive optimism
• HUB24 grows Q3 inflows and funds under administration
• RBA’s ‘worst nightmare’: What exactly is stagflation?
• 5 things to watch on the ASX 200 on Tuesday
• Worley flags $30–40m EBITA hit from Middle East conflict in FY26 outlook

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 financials stock Netwealth Group Ltd (ASX: NWL) is starting to win back investor attention after a rough stretch.

The ASX financials stock has jumped 20% over the past month, a sharp turnaround after a difficult period that saw it fall 23% over the past six months.

The recent rebound suggests confidence is returning, with investors warming again to Netwealth’s ability to keep attracting adviser and client funds, even in volatile market conditions.

So, what’s behind the renewed optimism?

Netwealth operates an investment platform that allows financial advisers to manage client portfolios, superannuation, and wealth accounts in one place. In simple terms, the $6 billion ASX financial stock sits at the centre of adviser-client relationships, providing the infrastructure that powers modern wealth management.

That positioning is a major strength. Once advisers and their clients are onboarded, they tend to stick around. Switching platforms can be complex and disruptive, which gives Netwealth strong customer retention and a steady stream of recurring revenue.

Its latest quarterly update reinforced that strength. The company reported funds under administration (FUA) of $125.8 billion, up 20.9% on the prior corresponding period. Importantly, this growth isn’t just being driven by rising markets. Netwealth also continues to win adviser market share, highlighting the competitiveness of its platform.

Stable margins, predictable cash flow

Growth is one thing, but profitability is where this ASX financials stock really stands out. Netwealth benefits from a recurring fee model, high adviser retention, and a sticky client base. That combination supports stable margins and predictable cash flow. Attributes that long-term investors tend to value highly.

It’s a model designed to compound steadily over time rather than rely on short-term bursts of performance. That strength is also flowing through to shareholders. Netwealth recently lifted its interim dividend by around 20%, reinforcing its appeal as a reliable income and growth hybrid.

Innovation is key

Of course, there are risks to consider. Competition in the platform space is intense, with rivals constantly pushing on fees and features.

Pricing pressure is an ongoing challenge, and maintaining a technological edge requires continuous investment. Fall behind on innovation, and market share gains can quickly reverse.

It’s also worth noting that while Netwealth has strong growth credentials, the ASX financials stock tends to trade at more conservative valuations than some high-flying tech names. That can limit upside during market rallies, but it also reflects a more measured, consistent growth profile.

What do the experts think?

According to TradingView data, most brokers rate the ASX financials stock as a buy or strong buy. The average 12-month price target sits at $28.22, implying potential upside of around 11% from current levels. The most bullish forecast sits at $35.40, which suggests a 40% upside at the time of writing.

Bell Potter just retained its buy rating with a $30.00 price target, while Morgans has an accumulate rating and a $29.00 target following the latest quarterly update. That points to a 18% and 14% upside respectively.

The post Experts say this ASX financials stock could soar up to 40% 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 Netwealth Group. The Motley Fool Australia has positions in and has recommended Netwealth Group. 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 are starting to turn, with momentum building after a period of heavy selling across the tech sector.

The stock is now lifting off recent lows, and the price action is beginning to look more stable.

At the time of writing, the Xero share price is up 1.29% to $83.04. That move comes after the stock hit a multi-year low of $67.93 on 30 March, before rebounding and holding above that level in April.

The shares later came close to that low again, dipping to $69.11 on 13 April, but buyers stepped in before it was retested.

That kind of price action usually points to selling pressure easing.

Here’s what this setup could be telling investors.

Why the sell-off went too far

The weakness over the past year has been very clear. Most of it has been driven by a broader de-rating across global growth stocks, not a change in Xero’s core business.

The company continues to expand its global subscriber base and lift revenue, supported by its position as a leading cloud accounting platform for small businesses.

The platform is deeply embedded in day-to-day operations. Once it is in place, it is difficult to replace, which supports recurring revenue and pricing over time.

There are also signs the cost side is improving. Hiring has slowed, which points to better discipline after a period of investment and should support margins into FY26.

The chart is starting to shift

The technical setup is becoming harder to ignore.

Xero hit a low in late March and has since held above that level. That is normally where things start to change. More recently, the stock has started to push higher, with short-term buying starting to pick up.

This pattern has also been showing up across the sector. Several ASX tech names such as Wisetech Global Ltd (WTC) have rebounded after trading near oversold levels earlier in the year.

What could drive the next leg higher

The macro environment is still creating noise, particularly around geopolitical developments and changing expectations for global growth.

But these conditions tend to move quickly. When sentiment turns, it often turns fast.

If markets begin to stabilise, the focus is likely to return to earnings and growth, where Xero still has clear levers. That includes subscriber expansion, pricing, and further development of its payments and ecosystem strategy.

With the share price still well below previous highs, even a modest improvement in conditions could have a strong impact.

Foolish takeaway

The recent price action suggests the worst of the selling may already be behind Xero shares.

The stock has found a low, held above it, and is now pushing higher, while the broader tech backdrop is starting to improve.

For me, this looks like the early stages of a recovery.

If that trend continues and is supported by Xero’s upcoming results on 14 May, the re-rating could still have further to run.

The post Is the worst over for Xero shares? Here’s what the chart is showing appeared first on The Motley Fool Australia.

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Motley Fool contributor Aaron Teboneras has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended WiseTech Global and Xero. The Motley Fool Australia has positions in and has recommended WiseTech Global and Xero. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.