Tag: Stock pick

On Friday, the S&P/ASX 200 Index (ASX: XJO) finished the week in the red. The benchmark index fell 0.65% to 8,869.1 points.

Will the market be able to bounce back from this on Monday? Here are five things to watch:

ASX 200 expected to fall again

The Australian share market looks set for a poor start to the week following a disappointing finish to the last one on Wall Street on Friday. According to the latest SPI futures, the ASX 200 is expected to open the day 60 points or 0.7% lower. In the United States, the Dow Jones was down 0.35%, the S&P 500 fell 0.45%, and the Nasdaq tumbled 0.95%.

Oil prices ease

It could be a subdued start to the week for ASX 200 energy shares Santos Ltd (ASX: STO) and Woodside Energy Group Ltd (ASX: WDS) after oil prices fell on Friday night. According to Bloomberg, the WTI crude oil price was down 0.3% to US$65.21 a barrel and the Brent crude oil price was down 0.4% to US$69.32 a barrel. Iran tensions gave oil prices a boost.

Buy ASK shares

Analysts at Bell Potter think investors should be buying Abacus Storage King (ASX: ASK) shares. Its analysts have initiated coverage on the self-storage company with a buy rating and $1.70 price target. It said: “Our investment case is predicated on a fundamental valuation disconnect between where ASK is trading (6.1% market implied cap rate, -13% discount to FY25 NTA, -20% to BPe FY26e NTA) and where storage assets/portfolios are clearing in the private market, with ASK-comparable assets transacting at-or-below 5% cap rates.”

Gold price crashes

ASX 200 gold shares Newmont Corporation (ASX: NEM) and Northern Star Resources Ltd (ASX: NST) could have a tough start to the week after the gold price crashed on Friday night. According to CNBC, the gold futures price was down 8.25% to US$4,879.6 an ounce. Traders were selling gold and silver (down 25%) after Donald Trump picked his next US Federal Reserve chief. The nomination removed Fed independence fears.

Rio Tinto update

The Rio Tinto Ltd (ASX: RIO) share price will be one to watch on Monday. That’s because the mining giant and Aluminum Corporation of China have announced a definitive agreement to acquire Votorantim’s controlling shareholding in Companhia Brasileira de Alumínio. It is a vertically integrated low-carbon aluminium business in Brazil, supported by a 1.6 GW portfolio of renewable power generation assets. Management notes that the transaction will leverage Rio Tinto and Aluminum Corporation of China’s deep and complementary expertise across the aluminium value chain to unlock the next phase of growth at Companhia Brasileira de Alumínio.

The post 5 things to watch on the ASX 200 on Monday appeared first on The Motley Fool Australia.

More reading

• 3 ASX 200 shares I would buy in February
• ASX 200 energy shares lead the market as oil and uranium prices spike
• Buy, hold, sell: BHP, DroneShield, and Santos shares
• These were the worst-performing ASX 200 shares in January
• Zimplats quarterly earnings: production up, costs down, projects on track

Motley Fool contributor James Mickleboro has positions in Woodside Energy 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 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.

As February arrives, the Australian share market is entering a more selective phase.

Inflation concerns, shifting interest rate expectations, and money moving between sectors are shaping investor behaviour. Some areas of the market have pulled back sharply, while others are quietly strengthening under the surface.

In this environment, I am looking for quality businesses with strong balance sheets, clear earnings drivers, and broker support.

Here are 3 ASX 200 shares that stand out to me right now.

Xero Ltd (ASX: XRO)

After a strong run through much of 2025, Xero shares have pulled back over recent weeks. That weakness has come as global tech stocks softened and investors rotated toward more defensive sectors.

Xero remains one of the highest quality software businesses on the ASX. It continues to grow subscriber numbers across key offshore markets, while improving margins as scale builds.

Brokers remain supportive. Several major investment banks have reiterated ‘buy’ ratings in recent months, pointing to Xero’s strong competitive position and long runway for earnings growth.

While short term volatility may persist, I see this as a high-quality growth name trading at more attractive levels than earlier in the year.

Woodside Energy Group Ltd (ASX: WDS)

The energy giant provides exposure to oil and LNG markets, alongside a fully franked dividend stream that many growth stocks simply cannot match.

Energy prices have firmed in recent months, supported by global supply discipline and ongoing geopolitical uncertainty. That backdrop has helped support Woodside’s cash flows and balance sheet.

Broker sentiment here is more balanced than bullish, but most analysts still see value. Several brokers have price targets modestly above current levels and continue to highlight Woodside’s dividend yield as a key attraction.

Northern Star Resources Ltd (ASX: NST)

Gold stocks have been quietly regaining attention, and Northern Star sits at the top of that list.

The miner benefits from strong production assets, improving margins, and rising gold prices. With global uncertainty lingering, gold has once again started to attract safe haven demand.

Northern Star has also executed well operationally, which has helped support broker confidence. Analysts generally view it as one of the better run gold producers on the ASX, with solid free cash flow generation.

If gold prices remain elevated, Northern Star could continue to outperform the broader S&P/ASX 200 Index (ASX: XJO).

Foolish takeaway

Markets rarely move in straight lines, especially around reporting season and shifting macro expectations.

These 3 ASX 200 shares give investors a mix of growth potential, income support, and exposure to gold.

For investors willing to look beyond short-term noise, February could offer some attractive entry points.

The post 3 ASX 200 shares I would buy in February appeared first on The Motley Fool Australia.

More reading

• 5 things to watch on the ASX 200 on Monday
• ASX 200 energy shares lead the market as oil and uranium prices spike
• These were the worst-performing ASX 200 shares in January
• Zimplats quarterly earnings: production up, costs down, projects on track
• Deterra Royalties posts higher Q2 revenue as MAC iron ore shines

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

ASX gold stock Catalyst Metals Ltd (ASX: CYL) closed at $8.62 per share, down 8% on Friday, but is up 158% over the past 12 months.

Catalyst Metals is a gold miner and explorer with an operational mine in Western Australia and a development project in Victoria.

Like all gold miners, Catalyst has benefitted from the remarkable rise in the gold price amid many tailwinds for the yellow metal.

Gold rallied 65% in 2025, following a 24% gain in 2024.

This week, the gold price went close to US$5,600 per ounce, and has risen by more than 20% in January alone.

Meantime, Catalyst Metals non-executive director, Robin Scrimgeour, has sold more than $10.8 million worth of shares since late November.

Between 20 and 23 January, an ASX disclosure shows Scrimgeour sold 1 million shares for which he is the beneficial owner, held indirectly through Citicorp Nominees (Australia) Limited.

The stock was sold on market for a total consideration of $9,222,935, indicating an average price of about $9.22.

Between 28 November and 2 December, Scrimgeour sold 250,000 Catalyst Metals shares on-market for consideration of $1,668,168.

That indicates an average price of $6.67.

Today, Scrimgeour holds 4 million shares in this ASX gold stock. However, his recent sales represent a near 25% reduction in holdings.

Catalyst Metals has not provided any explanation for the sales.

More about Catalyst Metals

Catalyst Metals owns the Plutonic gold mining operation in Western Australia and the Bendigo exploration project in Victoria.

Catalyst Metals expanded its Plutonic operations last year and is hoping to increase its reserves from 1.5 Moz to 2 Moz.

That is expected to allow it to increase its production rate from 100,000 ounces per year to 200,000 ounces per year.

On 15 January, Catalyst Metals released its 2Q FY26 update with news of record quarterly production at Plutonic.

Catalyst Metals reported gold production of 28,176 ounces.

The average realised price was A$2,776 per ounce and the average all-in sustaining cost (AISC) was A$2,565 per ounce.

Management retained its FY26 production guidance of 100,000 to 110,000 ounces at an AISC of between A$2,200 and A$2,650 per ounce.

Should you buy this ASX gold stock?

After the gold miner’s 2Q FY26 report, Morgans retained its buy rating and increased its 12-month price target from $10.58 to $12.51.

Morgans commented:

We now forecast FY26 sales of 109koz at an AISC of A$2,539/oz and update our price deck to align with recent spot gold movements.

We update our model for the result, reiterate our BUY rating and increase our price target to A$12.51ps (previously A$10.58ps).

Bell Potter also reiterated its buy rating on the ASX gold stock and raised its price target from $9.30 to $13.50.

Canaccord Genuity also has a buy rating on Catalyst Metals and increased its target from $13 to $13.25 this month.

The post Which ASX gold stock director has sold $10.8 million worth of shares? appeared first on The Motley Fool Australia.

More reading

• Why this ASX 200 gold stock jumped 8% to a record high today
• Here are the top 10 ASX 200 shares today
• Why Catalyst Metals, Lynas, Polynovo, and St George Mining shares are pushing higher today
• Top brokers name 3 ASX shares to buy next week
• Brokers name 3 ASX shares to buy today

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 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.

It is easy to assume that a company’s best days are behind it once it becomes well known to investors. But that’s not always the case.

On the ASX, there are several ASX growth shares that already have traction, but still appear to be in the early stages of what they could become over time.

Here are three growth shares that fit that description.

Life360 Inc. (ASX: 360)

The first ASX growth share that could still be early in its story is Life360.

Life360 operates a location-based platform focused on family safety and connectivity. What makes the opportunity compelling is not just the size of its user base (almost 100 million monthly active users), but how lightly monetised that base remains. Many users initially join for free functionality, giving the company time to build trust before introducing paid features.

Over time, Life360 has been expanding beyond simple location sharing into areas such as emergency assistance, driving insights, and safety services. This gradually increases the value of each customer relationship without relying on constant user acquisition. As engagement deepens and premium adoption rises, the economics of the platform can improve meaningfully.

That combination of scale, trust, and optionality suggests Life360’s growth story may still be unfolding.

Megaport Ltd (ASX: MP1)

Another ASX growth share that could be early in its journey is Megaport.

Megaport provides on-demand connectivity between data centres, cloud providers, and enterprise networks. While this sounds technical, the underlying idea is simple. It is aiming to make global connectivity more flexible, fast, and software-driven.

As businesses use multiple cloud platforms and operate across regions, networking requirements become harder to manage. Megaport’s platform is designed to solve that problem, becoming more valuable as digital infrastructure becomes more fragmented.

Importantly, Megaport has also been working to expand its opportunity. The recent acquisition of Latitude adds high-performance compute capabilities to the platform, which increases Megaport’s total addressable market and positions it closer to where networking and compute increasingly meet.

With cloud adoption still evolving and enterprise architectures continuing to change, Megaport’s growth appears far from over.

Temple & Webster Group Ltd (ASX: TPW)

A final ASX growth share that could still be early in its story is Temple & Webster.

This online furniture and homewares retailer has been growing at a rapid rate for many years, but it still only has a small market share.

As more and more sales shift online, Temple & Webster stands to benefit greatly thanks to its leadership position, especially given its asset-light model which allows it to offer a huge range of products without being exposed to inventory risks.

If management continues to execute its model successfully, Temple & Webster’s growth could continue for a long time to come.

The post Why these ASX growth shares could still be early in their story appeared first on The Motley Fool Australia.

More reading

• Why buy and hold investing with ASX shares could make you rich
• Where I’d invest in ASX shares if the RBA increases the interest rate
• These were the worst-performing ASX 200 shares in January
• In a hot market, the undervalued Australian shares to buy now
• Buy, hold, sell: Life360, Liontown, and Mineral Resources shares

Motley Fool contributor James Mickleboro has positions in Life360, Megaport, and Temple & Webster Group. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Life360, Megaport, and Temple & Webster Group. The Motley Fool Australia has positions in and has recommended Life360. The Motley Fool Australia has recommended Temple & Webster Group. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

Building a second income with ASX shares could be exactly what many Aussies are looking to do.

We can only generate so much in earnings when we work for money. It’s owning assets that help unlock that next phase of income creation.

I like to think of the ASX share market as the ASX business market – we can invest in great companies that are doing their best to make money for us, including paying dividends.

I’m using the three names below to build a second income for my own finances, and I want to highlight them for anyone wanting to build a second income with dividends.

MFF Capital Investments Ltd (ASX: MFF)

There are not many ASX investments that offer investors exposure to some of the world’s best businesses and have a good dividend yield.

Companies are allowed to declare the size of dividend they want to, as long as they have the accounting profit reserve for it. That’s one of the main reasons why investment businesses – namely listed investment companies (LICs) – can provide such consistent passive income for investors. The years of good investment profits can pay for ongoing dividends even when share markets are weak.

MFF has grown its normal annual dividend per share every year over the past several years. It owns some of the best global tech stocks, payment giants and other businesses with compelling futures in its portfolio.

I like the flexibility that the ASX share can invest in any business on the ASX or globally, which should help create good investment returns. I’m expecting its grossed-up dividend yield for FY26 to be at least 6%, including franking credits, at the time of writing’s valuation. That’s a great start for a second income.

L1 Long Short Fund Ltd (ASX: LSF)

This is another LIC – it invests in both ASX shares and global shares, utilising normal investing and short-selling strategies. L1 Long Short Fund typically looks to invest in undervalued businesses with relatively low price/earnings (P/E) ratios.

Past performance is not a guarantee of future performance. I think that disclaimer is particularly relevant when it comes to looking at the LIC’s investment performance. Over the past five years, its portfolio’s average annual net return was 18%.

That level of return is enough for the ASX share to provide growing dividends and capital growth.

Its payout has increased each year since 2021 and its latest quarterly dividend translates into a grossed-up dividend yield of 4.6%, including franking credits, at the time of writing. That’s a solid yield for building a second income.

Washington H. Soul Pattinson and Co. Ltd (ASX: SOL)

This business isn’t strictly a LIC, but it is a listed company that generates a lot of earnings through investing.

It’s an investment house that invests in a wide range of listed businesses, as well as owning private businesses.

Soul Patts has private investments in industrial property, building products, agriculture, swimming schools, electrification, retirement living, water rights and financial services.

The company has investments in ASX shares like New Hope Corporation Ltd (ASX: NHC), Tuas Ltd (ASX: TUA), TPG Telecom Ltd (ASX: TPG), Electro Optic Systems Holdings Ltd (ASX: EOS), Aeris Resources Ltd (ASX: AIS) and Nexgen Energy (Canada) CDI (ASX: NXG).

By utilising the cash flow of the dividend payments from its investment portfolio, Soul Patts is able to pay a growing dividend and invest in new opportunities for the portfolio.

Soul Patts has increased its annual dividend every year since 1998. That’s a wonderful record and the company wants to keep going for the foreseeable future, making it a wonderful pick for a second income.

I predict its grossed-up dividend yield in FY26 will be at least 4%, including franking credits, at the time of writing.

The post Don’t want to rely on your wage? Build a second income with these ASX shares appeared first on The Motley Fool Australia.

More reading

• 3 top ASX dividend share buys for passive income in February
• Here’s my buy list if the stock market crashes in 2026
• Forget term deposits! I’d buy these two ASX 200 shares instead
• Here are my top Aussie stocks to buy for 2026
• Here’s how you could turn the stock market into a $1,000 monthly passive income machine

Motley Fool contributor Tristan Harrison has positions in L1 Long Short Fund, Mff Capital Investments, Tuas, and Washington H. Soul Pattinson and Company Limited. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Electro Optic Systems and Washington H. Soul Pattinson and Company Limited. The Motley Fool Australia has positions in and has recommended Washington H. Soul Pattinson and Company Limited. The Motley Fool Australia has recommended Mff Capital Investments. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

It was another busy week for Australia’s top brokers. This has led to the release of a number of broker notes.

Three broker buy ratings that you might want to know more about are summarised below. Here’s why brokers think these ASX shares are in the buy zone:

CSL Ltd (ASX: CSL)

According to a note out of Citi, its analysts have retained their buy rating and $225.00 price target on this biotherapeutics company’s shares. The broker points out that CSL shares were sold off in 2025. This was due to concerns over margins, weak influenza vaccine demand, immunoglobulins growth, and Seqirus uncertainty. While this is disappointing, Citi believes there is scope for a recovery in 2026 even if its net profit doesn’t grow in the double digits as per its medium-term target. Citi feels that rebuilding investor confidence will be more important than beating earnings estimates. The CSL share price ended the week at $181.42.

DroneShield Ltd (ASX: DRO)

A note out of Bell Potter reveals that its analysts have retained their buy rating and $5.00 price target on this counter-drone technology company’s shares. This follows the release of another strong quarterly update from DroneShield last week. Bell Potter points out that the company’s sales growth was stronger than it was expecting. While its sales pipeline has reduced meaningfully since October, which appears to have spooked the market, Bell Potter isn’t concerned. The broker believes the sales pipeline reduction reflects the loss of low probability contracts or potential contracts that have been reduced in size. In addition, the broker once again reaffirms its belief that the company has a market leading offering and a competitive advantage owing to its years of battlefield experience. It thinks this bodes well for 2026 given how it believes this year will be an inflection point for the global C-UAS industry, with countries poised to unleash a wave of spending. The DroneShield share price ended the week at $3.32.

Liontown Ltd (ASX: LTR)

Another note out of Bell Potter reveals that its analysts have retained their buy rating on this lithium miner’s shares with a trimmed price target of $2.42. The broker acknowledges that Liontown’s quarterly update was softer than expected for production and revenues. However, it was pleased to see that its unit costs were better than expected. Looking ahead, Bell Potter points out that Liontown will be ramping up and de-risking its Kathleen Valley lithium project over the next 18 months. And given the current lithium price strength, it believes the company can rapidly generate cash to support incremental production expansions and shareholder returns. The Liontown share price was fetching $1.85 at Friday’s close.

The post Top brokers name 3 ASX shares to buy next week appeared first on The Motley Fool Australia.

More reading

• Why buy and hold investing with ASX shares could make you rich
• Buy, hold, sell: BHP, DroneShield, and Santos shares
• How to turn $250 a month into a $500,000 ASX share portfolio
• Buy, hold, sell: Life360, Liontown, and Mineral Resources shares
• What is driving today’s sell-off in ASX defence tech stocks?

Citigroup is an advertising partner of Motley Fool Money. Motley Fool contributor James Mickleboro has positions in CSL. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended CSL and DroneShield. The Motley Fool Australia has recommended CSL. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

ASX 200 energy shares outperformed the 10 other market sectors last week, rising 4.25%.

At the other end of the spectrum, tech shares fell 6.61% after inflation data raised the risk of an interest rate hike next week.

The Australian Bureau of Statistics reported that the Consumer Price Index rose by 3.8% in the 12 months to December.

That was an 0.4% increase compared to the 12 months to November.

The inflation data also followed surprisingly strong jobs data in the week prior, which showed that unemployment fell in December.

On Friday, markets were pricing in a 67% chance of a rate rise next week when the Reserve Bank Board meets for the first time this year.

The RBA will announce its decision on rates at 2:30pm on Tuesday.

Mining shares had another big week, with the materials sector up 3.66% by Thursday before a strong pullback on Friday.

Commodity prices continue to run, particularly gold, which went close to US$5,600 per ounce last week.

The S&P/ASX 200 Index (ASX: XJO) rose 0.1% to close at 8,869.1 points on Friday.

Seven of the 11 market sectors finished the week in the green.

Let’s review.

Why did ASX 200 energy shares lead the market last week?

ASX 200 energy shares led the market because of a spike in Brent crude and WTI oil futures, as well as an 18% lift in the uranium price.

On Friday, Brent Crude was US$68.47 per barrel, up 4.6% for the week and up 13.3% in the year to date.

WTI crude was US$64.31 per barrel on Friday, up 6% for the week and up 12.8% in the year to date.

On Friday, Trading Economics analysts said Brent and WTI oil prices were on track for their best month of price growth since July 2023.

Oil prices are being supported by a rising geopolitical risk premium.

The analysts said:

Concerns persist on renewed US–Iran tensions, after US President Donald Trump called on Iran to engage in nuclear talks, while Tehran warned of retaliation.

Market attention is focused on the potential impact of these tensions on shipping through the Strait of Hormuz, a narrow passage between Iran and the Arabian Peninsula that is critical for global energy flows, with tankers transporting crude oil and LNG passing through it daily.

Earlier this month, oil prices were also supported by geopolitical tensions in Venezuela, production outages in Kazakhstan, US production freeze-offs, and tightening US restrictions on purchases of Russian oil, factors that have pushed prices higher so far this year despite expectations of oversupply.

Higher oil prices supported ASX 200 oil shares like Woodside Energy Group Ltd (ASX: WDS), which rose 5.36% to $25.37 on Friday.

The Santos Ltd (ASX: STO) share price soared 8.51% to $7.01.

The Beach Energy Ltd (ASX: BPT) share price lifted 3.36% to $1.23.

Ampol Ltd (ASX: ALD) shares fell 4.82% to $28.84 and Viva Energy Group Ltd (ASX: VEA) lost 13.46% to close at $1.80.

The uranium price ripped 18% over the week to US$101.55 per pound on Friday as market confidence about long-term demand grew.

This lifted the ASX 200’s largest uranium share Paladin Energy Ltd (ASX: PDN) 3.98% higher to $13.84 per share.

Paladin Energy shares hit a 52-week high of $14.44 on Friday.

The Deep Yellow Ltd (ASX: DYL) share price ripped 21.27% to close at $2.84 after hitting a 52-week peak of $2.97 on Friday.

Boss Energy Ltd (ASX: BOE) shares increased 4.28% to $1.95.

ASX 200 market sector snapshot

Here’s how the 11 market sectors stacked up last week, according to CommSec data.

Over the five trading days:

S&P/ASX 200 market sector	Change last week
Energy (ASX: XEJ)	4.25%
Consumer Staples (ASX: XSJ)	1.26%
Financials (ASX: XFJ)	0.68%
Utilities (ASX: XUJ)	0.23%
Materials (ASX: XMJ)	0.18%
Communication (ASX: XTJ)	0.18%
Healthcare (ASX: XHJ)	0.11%
Industrials (ASX: XNJ)	(0.92%)
A-REIT (ASX: XPJ)	(1.08%)
Consumer Discretionary (ASX: XDJ)	(1.19%)
Information Technology (ASX: XIJ)	(6.61%)

The post ASX 200 energy shares lead the market as oil and uranium prices spike appeared first on The Motley Fool Australia.

More reading

• These were the worst-performing ASX 200 shares in January
• Zimplats quarterly earnings: production up, costs down, projects on track
• Deterra Royalties posts higher Q2 revenue as MAC iron ore shines
• These were the best-performing ASX 200 shares in January
• Here are the top 10 ASX 200 shares today

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 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 that buy and hold investing with ASX shares is one of the best ways to become rich.

But you can’t just buy anything, you have to invest your hard-earned money smartly.

With that in mind, here is how you could use buy and hold investing to create wealth.

Focus on quality ASX shares

When you buy a high-quality ASX share, you are not just buying a ticker code. You are buying a business with customers, employees, systems, and a strategy.

Over time, it is the business performance that drives returns. Earnings grow, products improve, and competitive positions strengthen. This is how long-term blue-chip winners such as Goodman Group (ASX: GMG), REA Group Ltd (ASX: REA), and ResMed Inc. (ASX: RMD) have rewarded patient investors.

None of this progress is visible in day-to-day share price movements. It happens gradually.

Time smooths out mistakes

No one buys at the perfect time. Buy and hold investing accepts that reality. Instead of trying to avoid every downturn, it relies on time to smooth out poor entry points. Even some of the best ASX performers have gone through uncomfortable periods.

Shares like Pro Medicus Ltd (ASX: PME) and Life360 Inc. (ASX: 360) have experienced sharp pullbacks along the way, despite delivering strong long-term returns. Investors who stayed focused on the business rather than the share price were the ones who benefited most.

Time allows good decisions to matter more than perfect ones.

Simplicity reduces costly behaviour

Buy and hold investing is as much about behaviour as it is about returns.

Fewer decisions mean fewer chances to make mistakes. Investors who keep portfolios simple and focused on quality are less likely to panic, overtrade, or abandon their strategy at the wrong time.

Holding a small group of strong businesses or even broad-market exchange traded funds (ETFs) can make it easier to stay invested when volatility strikes.

Buy and hold investing is not passive

Holding an ASX share does not mean ignoring it forever.

Buy and hold investing still involves monitoring businesses and reassessing when fundamentals change. The difference is that decisions are driven by long-term business performance, not short-term price movements.

That patience allows investors to capture the upside of long-term growth without being shaken out by temporary noise. Prime examples today are WiseTech Global Ltd (ASX: WTC) and CSL Ltd (ASX: CSL). Both are working their way through short-term issues, but nothing about the long-term investment thesis is broken.

Getting rich with ASX shares

If you are able to make a $1,000 investment into ASX shares each month and earned an average return of 10% per annum (not guaranteed but largely in line with historical returns), your wealth would grow materially.

After 20 years of doing this, you would have a portfolio valued at $725,000. And if you kept going for a further five years, you would see your portfolio increase to approximately $1.25 million.

Foolish takeaway

Buy and hold investing still works because businesses still grow.

On the ASX, shares like Pro Medicus, REA Group, and ResMed show how time, quality, and patience can work together to build wealth. Buy and hold investing may not feel exciting, but for investors focused on long-term results, it remains one of the most effective strategies available.

The post Why buy and hold investing with ASX shares could make you rich appeared first on The Motley Fool Australia.

More reading

• These were the worst-performing ASX 200 shares in January
• These 2 ASX shares are set to soar in 2026 and beyond
• Why these brokers are very bullish on the WiseTech share price
• How to turn $250 a month into a $500,000 ASX share portfolio
• Here are the top 10 ASX 200 shares today

Motley Fool contributor James Mickleboro has positions in CSL, Goodman Group, Life360, Pro Medicus, REA Group, ResMed, and WiseTech Global. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended CSL, Goodman Group, Life360, ResMed, and WiseTech Global. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has recommended Pro Medicus. The Motley Fool Australia has positions in and has recommended Life360, ResMed, and WiseTech Global. The Motley Fool Australia has recommended CSL, Goodman Group, and Pro Medicus. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

Looking for some new portfolio additions in February? If you are, then let’s see what analysts are saying about the popular ASX shares named below.

Are they buys, holds, or sells? Here’s what you need to know about them:

BHP Group Ltd (ASX: BHP)

This mining giant’s shares have been on fire in 2026. Unfortunately, the team at Morgans thinks they have now peaked and that investors should wait for a better entry point.

In response to BHP’s quarterly update, the broker has put a hold rating and $47.90 price target on the Big Australian’s shares. It said:

A sound 2Q26 result operationally, with WAIO setting a H1 production record and BHP upgrading guidance at both Escondida and Antamina. The offsetting negative was the separate update on the Jansen Stage 1 potash project, seeing a further budget upgrade to US$8.4bn and leaving concern around possible changes to Jansen Stage 2.

We have applied upgraded metal price forecasts, driving the upgrade in our target price but not transforming the value proposition, with BHP still appearing fair value. In our sector investment strategy we view BHP as a core holding on earnings and portfolio quality grounds as well as dividend profile, we maintain our Hold rating.

DroneShield Ltd (ASX: DRO)

This counter-drone technology company’s shares have pulled back recently and Bell Potter thinks a buying opportunity has opened up. Especially given how 2026 could be a very big year for the company.

Bell Potter has put a buy rating and $5.00 price target on DroneShield’s shares. It said:

We believe DRO has a market leading RF detect/defeat C-UAS offering and a strengthening competitive advantage owing to its years of battlefield experience and large and focused R&D team. We expect 2026 will be an inflection point for the global C-UAS industry with countries poised to unleash a wave of spending on RF detect and defeat solutions.

Consequently, we believe DRO should see material contracts flowing from its $2.1b potential sales pipeline over the next 3-6 months as defence budgets roll over to FY26e. At 47x CY26e EV / EBITDA, DRO trades at a 28% discount to the global drone peer group. Further, we see upside risk to our revenue forecasts in CY26/27e, given the opportunities observed in the C-UAS industry

Santos Ltd (ASX: STO)

The team at Morgans has also been looking at energy giant Santos. Although it delivered a fourth quarter update largely in line with expectations, the broker hasn’t seen enough to justify a higher valuation.

Morgans has put a hold rating and $6.60 price target on Santos’ shares. It said:

STO posted a largely in line 4Q25 production and revenue result, although updates on its two key growth projects did flag some incremental negatives. Barossa ramp-up is dealing with an expected ~2-month delay vs planned. Pikka Phase 1 saw a ~US$200m upgrade in capex budget on a combination of cost pressures.

Hiccups aside STO has done a good job executing, with Barossa and Pikka startups set to help the cash flow equation. Trading closed at a modest discount to our A$6.60 Target Price and we maintain our Hold rating.

The post Buy, hold, sell: BHP, DroneShield, and Santos shares appeared first on The Motley Fool Australia.

More reading

• Here are the top 10 ASX 200 shares today
• What is driving today’s sell-off in ASX defence tech stocks?
• 3 ASX 200 stocks smashing the benchmark this week
• Why ASX 200 energy stocks like Santos and Woodside shares are ending the week with a bang
• 5 things to watch on the ASX 200 on Friday

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 positions in and has recommended DroneShield. 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.

There are certain ASX-listed exchange-traded funds (ETFs) that I’m very optimistic about. I don’t know what’s going to happen with share markets, but certain characteristics could help deliver strong returns for investors.

The global share market is home to thousands of businesses, but not all of them will be great ones to own for the long term.

Wouldn’t it be good to just own a portfolio of the best ones? That’s what the two ASX ETFs I’m going to talk about have constructed – portfolios full of purely high-quality businesses that have a good chance to deliver pleasing returns.

VanEck MSCI International Quality ETF (ASX: QUAL)

Both of the ASX ETFs I’m going to talk about offer fairly similar investment strategies. I have been invested in the QUAL ETF for some time, but I’d happily own units in the other fund (or both).

The QUAL ETF aims to have 300 companies in its portfolio, which are diversified across a range of geographies, sectors, and economies. I like this for the diversification it provides for investors.

VanEck, the provider of this fund, says that investments focusing on companies with quality characteristics have historically delivered outperformance over the long term compared to the global share market benchmark.

The QUAL ETF looks for three fundamentals to decide if a business is high-quality.

First, there’s the requirement that they have a high return on equity (ROE). That means they earn a high level of profit for how much money is retained within the business. That demonstrates a high level of profitability and suggests how much the business could make on additional profits retained within the business.

Second, the businesses in the ASX ETF must have stable earnings. In my mind, if earnings aren’t going backwards, then it means profit is probably rising, which is a good tailwind for share price growth.

Third, the QUAL ETF’s holdings must have low financial leverage. That means the balance sheets are healthy and the ROE hasn’t been boosted artificially by utilising a lot of debt.

Unsurprisingly, this has led to its top holdings being names like Meta Platforms, Nvidia, Apple, Microsoft, Eli Lilly, Alphabet, Visa, and ASML.

The investment strategy is clearly working well, with the QUAL ETF delivering a total return per year of 14.8% over the last decade. Time will tell if it can produce further strong returns in the coming years.

Betashares Global Quality Leaders ETF (ASX: QLTY)

There are some differences between the QLTY ETF and the QUAL ETF, which could make the one I’m about to outline seem more appealing in its own way.

The QLTY ETF has only 150 companies in its portfolio, but their weightings are more evenly spread, which, in some ways, makes it more diversified than the QUAL ETF.

This portfolio is also spread across a number of countries, including the US, Japan, the Netherlands, Switzerland, France, Hong Kong, Spain, and the UK. Excitingly, the fund has a double-digit allocation to a number of sectors, including IT, industrials, healthcare, financials, and consumer discretionary.

There are four factors that decide what the QLTY ETF invests in – ROE, debt to capital, earnings stability, and cash flow generation ability. The first three elements are essentially the same as the QUAL ETF, so I won’t repeat what they mean. The fourth element – cash flow – means that we want to see earnings translate into cash hitting the bank account.

Since the QLTY ETF’s inception in November 2018, it has returned an average of 14.4% per year. I think its future returns are promising, so we’ll see how it performs in the coming years, but I’m optimistic.

The post 2 excellent ASX ETFs I rate as buys in February appeared first on The Motley Fool Australia.

More reading

• 10 most popular ASX ETFs on the market today
• 3 of the best ASX ETFs for Australian investors to buy now
• 2 incredible ASX shares to buy in February
• 3 VanEck ETFs on the ASX I rate as buys
• 3 ASX ETFs to buy and hold until 2036

Motley Fool contributor Tristan Harrison has positions in VanEck Msci International Quality ETF. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended ASML, Alphabet, Apple, Meta Platforms, Microsoft, Nvidia, and Visa. The Motley Fool Australia has recommended ASML, Alphabet, Apple, Meta Platforms, Microsoft, Nvidia, and Visa. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.