Tag: Stock pick

Given that interest rates are rising in Australia again, it could be a good time to look at ASX shares with higher dividend yields.

If we’re going to invest in ASX shares for passive income, I’d want to ensure we’re getting an attractive payout. We don’t necessarily need a dividend yield of more than 7% to call it an appealing investment.

But, the two ASX shares below are ones that I believe can offer large dividend yields in the short-term and payout growth in the long-term.

Charter Hall Long WALE REIT (ASX: CLW)

This is one of the most appealing real estate investment trusts (REITs) in my opinion because it offers a combination of yield, security and diversification.

The ASX share is invested across a variety of areas including service stations, pubs and hotels, telecommunication exchanges, data centres, distribution centres and plenty more. I don’t think there’s a better REIT for sector diversification on the ASX.

This business can provide pleasing security within its portfolio because it’s looking to maintain a portfolio of investments that have long rental contracts. In other words, the REIT has a long weighted average lease expiry (WALE). The WALE currently stands at around nine years.

That high-quality rental income is steadily growing, with the income benefiting from fixed annual indexation or rental increases linked to inflation. That’s a pleasing, natural tailwind for the business.

In FY26, the ASX share has guided that it expects to increase its annual distribution per unit by 2% to 25.5 cents. Any growth in the current environment is good, in my view. That forward distribution translates into a dividend yield of 7.2%, at the time of writing.  

WCM Global Growth Ltd (ASX: WQG)

The other ASX share I want to highlight is a listed investment company (LIC) that is one of the most effective choices, in my view, for both passive income and some capital growth.

Excitingly, WCM pulls its ideas from across the global share market, which gives the LIC great diversification and helps it unlock strong returns. The global economy has a much larger addressable market than Australia and New Zealand, so it’s pleasing when a business is targeting international growth.

Many of the businesses inside the WCM Global Growth portfolio have multinational/global ambitions, giving them a longer growth runway and the potential to earn stronger returns than ASX blue-chip shares.

The ASX share aims to find businesses with strengthening competitive advantages, which is supported by a corporate culture that can help those businesses grow their profitability and market position.

WCM Global Growth now pays a dividend every quarter to shareholders and that payment has been increasing each quarter. Its annual dividend has increased each year since 2019.

The next four guided quarterly dividends are expected to come to a total of 9.3 cents per share, which translates into a grossed-up dividend yield of 7.5%, including franking credits.

The post 2 ASX shares with dividend yields above 7% appeared first on The Motley Fool Australia.

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• Want to build a second income? I’d buy these ASX shares today
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Motley Fool contributor Tristan Harrison has positions in Wcm Global Growth. 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.

Treasury Wine Estates Ltd (ASX: TWE) shares have had a tough year.

At the current share price, they are down roughly 50% from a 52-week high of $9.18.

While there is still a lot of work to be done, when I look at where things stand today, I think this is one worth considering.

A business going through a reset

There is no getting around the fact that the last year has been difficult for the wine giant.

Earnings pressure, weaker demand in some markets, and broader industry challenges have all weighed on performance. That has also impacted dividends, with the market currently expecting no payout in FY26.

That may understandably put some income investors off in the short term.

However, I think it is important to separate what is happening now from where the business could be heading.

An update this week points to improving momentum in some key markets. Depletions have returned to growth in the US and remain strong in China, while the company is also rolling out changes to improve execution.

If that continues, the earnings profile could begin to rebuild from here.

Income potential returning over time

Looking ahead, dividend expectations start to recover.

According to CommSec, consensus estimates point to partially franked dividends of 15 cents per share in FY27 and 24 cents per share in FY28.

At the current share price, that would imply a forward dividend yield of around 3.3% in FY27, rising to over 5.3% in FY28, before considering franking credits.

That is where I think the opportunity starts to become more interesting.

You are not buying this for immediate income. You are buying it with the expectation that income returns as the business recovers.

There is more than just income here

I also do not think this is purely an income story.

Treasury Wine Estates still owns a portfolio of premium brands, with Penfolds remaining a key driver. There are also signs of improving demand in markets like China, alongside better momentum in the US.

At the same time, the company is restructuring its operations, which could support margins and efficiency over time.

There is also the balance sheet to consider. Recent refinancing activity has strengthened liquidity, giving the company greater flexibility as it navigates this period.

When I put that together, I see an ASX dividend stock trying to reset rather than one in decline.

Foolish takeaway

Treasury Wine Estates is not the simplest ASX dividend stock to buy right now.

There may be no income in FY26, and it may take time for earnings to rebuild.

But looking further ahead, dividends are expected to return and grow, and the share price is already reflecting a lot of the recent challenges.

For investors who are willing to be patient, I think this could be a dividend stock worth considering after a 50% sell-off.

The post 1 ASX dividend stock down 50% I’d buy appeared first on The Motley Fool Australia.

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• 3 ASX 200 stocks storming higher in this week’s sinking market
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• Why is everyone buying this beaten-down ASX wine stock now?
• Here are the top 10 ASX 200 shares today

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

There are plenty of options for investors on the Australian share market.

To narrow things down, let’s see what analysts are saying about three very popular ASX 200 shares.

Here’s what you need to know:

Cochlear Ltd (ASX: COH)

The team at Morgans has responded negatively to this hearing solutions company’s disappointing trading update.

So much so, it has retained its hold rating but cut its price target in half to $107.17 (from $214.93). It said:

COH has delivered a material downgrade to FY26 earnings, cutting guidance by c30% at the midpoint. While FX, geopolitics and cost actions contributed, the key takeaway is more fundamental, with CI demand, especially in developed markets, proving to be more cyclical and macro-sensitive than previously assumed.

This challenges the market’s long-held view as a structural, volume-driven growth story largely insulated from economic cycles. While we view long-term fundamentals as intact, near-term earnings visibility has deteriorated materially, so we wait for demand stabilisation before re-engaging. We adjust our FY26-28 estimates and lower our target price to A$107.17 HOLD.

CSL Ltd (ASX: CSL)

Bell Potter notes that CSL shares have de-rated to lower than normal earnings multiples.

However, it feels this is justified at present given its soft outlook. As a result, it has a hold rating and $155.00 price target on its shares. It explains:

The current share price reflects a materially de-rated PE multiple of ~15x our FY27 NPAT forecast, bringing CSL in line with the global biopharma peer set which also trades at an avg PE of 15x. While CSL doesn’t face the same extent of generic/biosimilar competition as these biopharma peers, it does have a lower growth outlook of ~2.5% revenue CAGR (3yr) per our forecast compared to >4% avg for global peers.

Considering the low-growth outlook in the near-term, risk to FY26 guidance, and our below-consensus FY27 forecasts, we maintain our HOLD recommendation notwithstanding the historically low trading multiple. We don’t think CSL is out of the woods just yet. PT is lowered to $155.

DroneShield Ltd (ASX: DRO)

Bell Potter is much more positive on this counter-drone technology company’s shares.

In response to a strong quarterly update, the broker retained its buy rating and $4.80 price target.

The broker believes DroneShield is well-placed for growth thanks to favourable industry tailwinds. 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 $2.3b potential sales pipeline over the next 3-6 months as defence budgets roll over to FY26e. At 43x CY26e EV / EBITDA, DRO trades at a 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.

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

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• The Warren Buffett rule I keep coming back to with ASX shares
• Down 50%, why I’d invest $20,000 into CSL shares
• Brokers name 3 ASX shares to buy right now
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• How high could Cochlear shares bounce back? Brokers disagree

Passive income is a powerful strategy to earn money with minimal effort.

Earning a passive income from ASX dividend shares is a straightforward way to make money to supplement your main income.

Not only that, but it gives you some more financial freedom, helps create a buffer against volatility and also helps you to build wealth over time.

The question investors always ask is: How much do I need to invest in ASX shares to earn the passive income I want?

A simple calculation

Say you want to earn $500 per month in passive income by investing in ASX shares.

It sounds like a lot, but it’s perfectly doable.

Your $500 per month totals $6,000 per year in dividend payments.

The easy calculation to work out how much money you need to invest is to divide your annual dividend income by the dividend yield of the ASX stock you’re considering.

In other words, $6,000 divided by an average dividend yield of, say, 3.5% equals $171,428.

That $171,428 figure is what you’d need to invest in order to earn your $500 monthly dividend payout.

The problem is that the figure will vary wildly depending on the dividend yield of the ASX shares you’d be buying. 

For example, if you’re buying ASX shares with a 4% dividend yield, you’d need to invest $150,000 to receive the same passive income.

For ASX shares with a 5% dividend yield, you’d need to invest $120,000.

Then for ASX shares yielding 6% or 7% you’d need to invest $100,000 or $85,714 respectively.

As the dividend yield increases, your upfront investment decreases.

Can’t I just invest in high-yield shares?

Technically, yes, but it wouldn’t be a good idea from an investment perspective.

Generally, the higher the yield, the higher the risk associated with that ASX stock. Rather than trying to get rich quickly, your focus should always be on earning sustainable passive income over the long term.

The key is consistency and lots of patience. 

And remember, you don’t need to invest the whole sum in one go. Start with a monthly investment and let compound growth do some of the hard work for you.

A regular contribution of $500 per month is a great start and could take around 17 years to reach a $171,000 portfolio. If you can make additional payments, or even hike that to $1000 per month, it’ll easily cut 7-8 years off your timeline. 

The post How much do I need to invest in ASX shares to earn a $500 monthly passive income? appeared first on The Motley Fool Australia.

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• 1 ASX dividend stock down 50% I’d buy
• Buy, hold, sell: Cochlear, CSL, and DroneShield shares
• All-weather ASX ETFs to buy if the market crashes 20%
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• 2 great ASX 200 blue-chip shares I’d buy right now

Motley Fool contributor Samantha Menzies 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.

Every veteran investor knows markets crash. The question is never whether it will happen. It is whether there is a plan ready for when it does.

History is clear on this point. The share market’s biggest single-day and weekly gains have almost always followed its worst periods. Investors who panic-sold in March 2020, in the 2022 rate shock, or during the GFC did not just lock in losses — they missed the recoveries that followed. Those recoveries have been among the greatest wealth-creation events of a lifetime.

So if the S&P/ASX 200 Index (ASX: XJO) fell 20% from here, what might a prepared investor actually do?

Buy. Deliberately. With a list already prepared.

Save like a pessimist, invest like an optimist

One framework worth considering starts well before a crash arrives. Keeping a cash buffer — not out of fear, but out of preparation — creates “dry powder”. It is what allows an investor to lean into fear when others are running from it.

When the drop comes, the goal is not to pick the exact bottom. That is a fool’s (small “f”!) errand. The aim is simply to be in the market when it recovers. Perfect positioning is not required. Participation is.

The core of a sensible crash-buying approach is broad, low-cost index exposure to the two most important share markets in the world.

For Australia, the Vanguard Australian Shares Index ETF (ASX: VAS) tracks the 300 largest companies on the ASX. Banks, miners, healthcare, consumer staples — all in one basket. When the market is down 20%, the case for owning the whole market rather than trying to pick survivors becomes even stronger.

For the United States, the iShares S&P 500 ETF (ASX: IVV) offers unhedged S&P 500 exposure, while the iShares S&P 500 AUD Hedged ETF (ASX: IHVV) removes currency noise for investors who prefer not to carry AUD/USD risk.

Together, VAS and either the IVV or IHVV ETF can form the core of a portfolio: stable, diversified, and built to survive almost anything.

The satellite: growth where it matters most

A core-only portfolio is robust, but not particularly positioned for growth. That is where a satellite allocation can earn its place.

The focus here is not on chasing every trend. The more compelling case is for two structural shifts that look likely to reshape the global economy over the next decade: robotics and AI infrastructure.

The Betashares Global Robotics and Artificial Intelligence ETF (ASX: RBTZ) provides exposure to companies developing and deploying robotics and AI — from industrial automation to unmanned systems. When markets fall broadly, quality companies in transformational sectors often fall just as hard as everything else. That is the potential entry point.

The other satellite worth watching is the Global X Artificial Intelligence Infrastructure ETF (ASX: AINF). While most attention focuses on the software and chip layer of AI, AINF sits beneath all of that — in the energy systems, data infrastructure, and materials that make AI physically possible. Global data centre spending is expected to exceed US$2 trillion over the next five years. That is not a trend. That is a building site.

A core-satellite approach does not mean splitting things equally. The core should represent the bulk of any position — perhaps 70–80% — with satellite ETFs taking a smaller, higher-conviction slice.

The Foolish takeaway

A 20% market crash would be uncomfortable. It always is. But discomfort and danger are not the same thing for a long-term investor with a prepared portfolio and cash ready to deploy.

The investors who tend to build real wealth are rarely the ones with the cleverest trades. They are the ones who stayed calm, kept buying, and let the market do its work over time. Having a watchlist of ETFs ready before the market falls is how that patience gets put to work.

The post All-weather ASX ETFs to buy if the market crashes 20% appeared first on The Motley Fool Australia.

More reading

• 3 ASX ETFs with market-beating potential over the next 10 years
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• Are these the best ASX ETFs to buy with $1,000 in May?
• ASX ETF investors exit US stocks in favour of Aussie shares: Betashares
• How I’d use the iShares S&P 500 ETF (IVV) to create $50,000 annual passive income

Motley Fool contributor Leigh Gant 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 iShares S&P 500 ETF. The Motley Fool Australia has recommended iShares S&P 500 ETF. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

If you are hunting for big returns for your portfolio, then read on.

That’s because the ASX 200 shares in this article have been tipped to rise strongly from current levels by a couple of leading brokers.

Here’s what they are saying about these shares:

Northern Star Resources Ltd (ASX: NST)

This gold giant could be an ASX 200 share to buy according to Morgans.

It was pleased with its quarterly update and its decision to return funds to shareholders through an on-market share buy-back.

Overall, Morgans sees plenty of value in the gold miner’s shares at current levels and has put a buy rating and $30.00 price target on them. Based on its current share price, this implies potential upside of almost 40% for investors. It also expects a 2.5% dividend yield in FY 2026, boosting the total potential return further.

Commenting on its quarterly update, the broker said:

Gold sold of 381koz at AISC of A$2,709/oz beat our revised expectations, with sequential improvement across all three production centres following ongoing production issues. KCGM Mill Expansion on track for commissioning in early FY27; FY26 guidance has been provided and is above 1,500koz at AISC of A$2,600–2,800/oz. Net cash of A$320m; A$500m on-market buy-back announced, commencing ~23 April. We maintain our BUY rating, price target A$30.00ps (unchanged).

WiseTech Global Ltd (ASX: WTC)

The team at Bell Potter has trimmed its valuation of this logistics solutions technology company. However, even after this revision, it sees potential for WiseTech Global’s shares to rise very strongly over the next 12 months.

The broker has put a buy rating and $78.75 price target on them. Based on its current share price of $44.44, this implies potential upside of almost 80% for investors over the next 12 months.

Bell Potter believes the current discount that the ASX 200 share is trading on is excessive, especially given its strong competitive moat. It explains:

We note that WiseTech is currently trading at >30% discount to Technology One on an EV/EBITDA basis in both FY26 and FY27. While we believe some sort of discount is now warranted, we believe the current discount is excessive given WiseTech has greater forecast earnings growth over the medium term and also a similar strong competitive moat due to 30 years of proprietary data, deeply embedded software and high switching costs.

The post These ASX 200 shares could rise ~40% to 80% appeared first on The Motley Fool Australia.

More reading

• Brokers name 3 ASX shares to buy right now
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• What is Morgans saying about Cochlear and Northern Star shares?
• 5 ASX 200 shares with renewed buy ratings this week
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Motley Fool contributor James Mickleboro has positions in WiseTech Global. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended WiseTech Global. The Motley Fool Australia has positions in and has recommended WiseTech Global. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

In times of uncertainty, S&P/ASX 200 Index (ASX: XJO) blue-chip shares could be a strong choice for reliability.

I’d want to look at businesses that offer products and services customers consider essential. Additionally, it seems inflation may pick up in the near term, so it may be useful to look at businesses that protect profitability during this period.

I’m going to highlight Australia’s leading telecommunications business and a major retailer because of the defensive earnings they can provide. Let’s get into it.

Telstra Group Ltd (ASX: TLS)

Telstra offers the largest network coverage, has the most subscribers and the most valuable spectrum assets.

These advantages have enabled the business to invest more in its network compared to its competitors, thereby maintaining its economic moat.

The ASX 200 blue-chip shares’ market position has given it confidence to regularly increase prices over the last few years, which is a strong tailwind for average revenue per user (ARPU) and profit margins.

If elevated inflation does persist, I expect the ASX 200 blue-chip share will continue to raise prices. Its perception of having a superior network is likely to help it retain most of its customer base and benefit from the higher mobile prices.

I’m expecting Telstra’s bottom line to continue improving for the foreseeable future, due to how essential an internet connection is to households and businesses.

As a bonus, the business is regularly increasing its dividend for investors. According to the Commsec projection, the Telstra share price is valued at 27x FY26’s estimated earnings, with a possible grossed-up dividend yield of 5.6%, including franking credits, at the time of writing.

Wesfarmers Ltd (ASX: WES)

Wesfarmers is the other high-quality ASX 200 blue-chip share I strongly believe has a compelling future in the years ahead.

As the owner of Bunnings and Kmart, Wesfarmers looks like it’s well-positioned to be one of the most important businesses in helping households access good-value products.

I’m regularly impressed by the financial metrics the business achieves. In the FY26 half-year result, Bunnings Group reported a return on capital (ROC) of 70.8%, and Kmart Group achieved a ROC of 69.8%.

Those ROC figures show how profitably Wesfarmers’ money has been put to work in these two businesses. I think it bodes well for future profit growth if they can continue to earn returns of that sort.

I also want to point out that the business achieved a return on equity (ROE) of 32.7% in the first half of FY26, which I think is very impressive for a business like Wesfarmers.

I like the ASX 200 blue chip shares’ initiative to expand into new areas to unlock further earnings growth. Ideas such as lithium mining, healthcare, and Anko’s expansion in the Philippines each have a large growth runway and offer something quite different to Wesfarmers’ earnings base.

In my view, earnings diversification and adjusting its business portfolio over time are among the best things that have helped future-proof the business. I also include WesCEF and Officeworks as useful profit contributors in the overall picture.

In 10 years, Wesfarmers’ business could change noticeably, but I think that will help strengthen the business through management’s long-term focus.

According to Commsec’s projections, the Wesfarmers share price is valued at 29x FY26’s estimated earnings, with a potential grossed-up dividend yield of 4.1% (including franking credits) at the time of writing.

The post 2 great ASX 200 blue-chip shares I’d buy right now appeared first on The Motley Fool Australia.

More reading

• The Warren Buffett rule I keep coming back to with ASX shares
• 3 ASX dividend shares I’d hold through anything
• Almost ready to retire? I’d buy cheap ASX dividend shares for passive income
• Where I’d invest my first $500 into ASX shares
• 1 ASX dividend stock up 20% that I’d hold through any market

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

Warren Buffett has shared a lot of investing advice over the years, but one quote always sticks with me:

It’s far better to buy a wonderful company at a fair price than a fair company at a wonderful price.

I think this captures something simple but powerful.

It shifts the focus away from trying to find the cheapest ASX share and toward finding the right business.

Quality comes first

It is easy to get drawn to shares that have fallen a long way or trade on ultra-low PE ratios.

Sometimes that works out. Other times, there is a reason the share price has dropped and it never really recovers.

Warren Buffett’s approach is a reminder to start with the business itself.

I try to focus on ASX shares that have strong positions, consistent demand, and the ability to keep performing over time. If those pieces are in place, I am much more comfortable investing, even if the price is not at its lowest point.

Price still matters, just not in the same way

That quote does not ignore valuation. It just puts it in the right place.

I still want to buy at a reasonable price. A pullback can make a high-quality ASX share more attractive, and that is often where opportunities come from.

For example, when a company like CSL Ltd (ASX: CSL) trades well below its previous highs, I think about whether the underlying business has changed or whether the price has simply moved.

That is where this rule becomes useful.

The businesses I keep coming back to

On the ASX, I find myself drawn to companies that can keep delivering over time.

Businesses like Wesfarmers Ltd (ASX: WES) have shown they can grow across different cycles, while others like Transurban Group (ASX: TCL) benefit from steady demand and long-term assets.

They are very different, but they share one thing. They are built to last.

Why I keep using this rule

This way of thinking helps filter out a lot of noise.

Instead of asking which share is cheapest or which one has fallen the most, I focus on which businesses I would be comfortable holding for years.

That tends to lead me toward the same types of ASX shares again and again.

Foolish takeaway

The Warren Buffett rule I keep coming back to is focusing on quality first, then price.

Finding a strong business and buying it at a reasonable level is not complicated, but it works.

It keeps the process clear and helps me stay focused on what actually matters when investing in ASX shares.

The post The Warren Buffett rule I keep coming back to with ASX shares appeared first on The Motley Fool Australia.

More reading

• 2 great ASX 200 blue-chip shares I’d buy right now
• Down 50%, why I’d invest $20,000 into CSL shares
• 3 ASX dividend shares I’d hold through anything
• Almost ready to retire? I’d buy cheap ASX dividend shares for passive income
• 3 ASX shares I’d buy if the market dropped again

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

CSL Ltd (ASX: CSL) has been one of the most heavily sold-off blue-chip shares on the ASX over the past year.

At current levels, the share price is down significantly from its 52-week high of $275.79.

While sentiment has clearly weakened, I see a biotech business that still has the same long-term drivers in place.

Here is why I’d be comfortable putting $20,000 into CSL shares.

The underlying demand is not going away

CSL operates in areas of healthcare that are not discretionary.

Its core plasma therapies are used to treat chronic and rare conditions. These are ongoing treatments, not one-off purchases, which creates a recurring demand base.

What is important to me is that this demand is tied to patient need rather than economic cycles.

Even though recent results were disappointing, the company continues to expect future growth to be driven by immunoglobulin, albumin, and newer product launches.

With its first-half results, Ken Lim, CSL’s CFO, said: “In the second half, we have an ambitious growth plan, driven by immunoglobulin (Ig), albumin and our newly launched products.”

That tells me the underlying drivers are still there.

It is still investing for the next phase of growth

One thing I look for in a long-term investment is whether the company is still building.

CSL is continuing to invest heavily in its future, including expanding its plasma manufacturing capacity and progressing its pipeline.

It is also working through a broader transformation program aimed at simplifying operations and improving efficiency.

These are not the actions of a business standing still.

They are the kinds of investments that can support growth over the next decade, even if they weigh on sentiment in the short term.

The competitive position remains strong

CSL has spent decades building its position in global healthcare.

It operates at scale, has deep expertise in plasma collection and manufacturing, and continues to invest in research and development.

These are not easy advantages to replicate.

What matters here, I think, is durability. Even when performance is uneven, businesses with strong positions tend to recover and continue growing over time.

That is one of the key reasons I would be willing to look through the recent poor performance and share price weakness.

The reset changes the starting point for CSL shares

The CSL share price is now in a very different place compared to where it was a year ago.

At higher levels, it was easy to question the valuation. After a 50% decline, that starting point has shifted materially.

I am not suggesting the share price cannot fall further. But I do think the risk-reward looks more favourable now than it did previously.

If the company delivers on its growth plans over time, today’s price could look cheap in hindsight.

Foolish takeaway

CSL has gone through a difficult period, and the share price reflects that.

But the underlying demand, long-term growth drivers, and competitive position still appear to be in place.

With the share price down heavily, I would be comfortable investing $20,000 with a long-term mindset, expecting that the business can rebuild momentum over time.

The post Down 50%, why I’d invest $20,000 into CSL shares appeared first on The Motley Fool Australia.

More reading

• 3 ASX shares I’d buy if the market dropped again
• Can the beaten-down CSL share price ever reach $300 again?
• CSL’s collapse deepens. Why this ASX giant can’t find a floor
• Prediction: CSL shares could surpass $265 in 2026
• Are ASX healthcare shares the next to rally?

Motley Fool contributor Grace Alvino has positions in CSL. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended CSL. 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.

There is a retirement decision many Australians make in their 50s and early 60s that feels sensible, cautious, and responsible.

It can also be one of the most expensive mistakes in long-term wealth building.

The idea sounds reasonable enough: as retirement gets closer, shift your super into cash or a conservative option so you can protect what you have built. After all, if markets fall, you have less time to recover.

That is the part that makes the decision feel smart.

The problem is that safety and lower returns often travel together. And over the final stretch before retirement, that trade-off can become far more costly than people expect.

What actually hurts returns

The biggest damage usually does not come from a market fall on its own.

It comes from what happens next.

When investors switch to cash after markets have already fallen, they often lock in the decline. Then, because confidence usually returns slowly, many stay defensive while markets recover. That means they can miss part of the rebound, which is often where a large share of long-term returns is earned.

That is the trap.

Market downturns feel dangerous in the moment. Yet for long-term investors, the bigger risk is often responding emotionally and giving up years of future compounding.

Why the final decade matters so much

One of the most misunderstood parts of retirement planning is how powerful the last 10 years before retirement can be.

By that stage, many people have built meaningful super balances. Even modest percentage returns on a larger base can add up quickly. That means the final decade is not just about preservation. It is still a major growth phase.

For example, a $400,000 super balance growing at 9% a year for 10 years would become roughly $947,000, even without extra contributions.

If that same balance grew at 4% a year instead, it would reach about $592,000.

That is a gap of more than $350,000.

This is why moving to low-growth settings too early can have such a lasting impact. It is not simply about avoiding losses. It is about what you give up in return.

The market downturn can make this decision more dangerous

A falling market often creates the strongest urge to “play it safe”.

That is understandable. Watching your super balance decline can be uncomfortable, especially when retirement no longer feels far away.

Yet this is exactly when a rushed switch can do the most harm.

If markets are already down, moving to cash may protect you from further short-term falls, but it can also leave you stranded if prices recover sooner than expected. And recoveries rarely wait until investors feel calm again.

In other words, the danger is not just volatility. The danger is making a permanent portfolio decision based on a temporary emotional state.

A downturn does not automatically mean your super strategy is wrong. It may simply mean markets are doing what markets have always done from time to time.

What to focus on instead

That does not mean everyone should stay aggressively invested forever.

Your investment mix should reflect your age, expected retirement date, need for income, other assets, and ability to tolerate fluctuations. There is no one-size-fits-all answer.

However, a change this important should be based on your full financial position, not a scary patch in the headlines.

For many Australians, better questions to ask are:

How much growth do I still need?

How long until I start drawing heavily on my super?

Will I retire all at once, or transition gradually?

Do I have cash or other assets outside super that reduce the need to panic?

Those questions are far more useful than simply asking whether cash feels safer today.

Foolish Takeaway

The myth is not that cash is always bad. It is that conservative automatically means safer.

In reality, switching your super to cash or a low-growth option too early can reduce your long-term retirement outcome by far more than many people realise. Not because you made a reckless decision, but because the decision felt prudent at exactly the wrong time.

Super is still a long-term investment vehicle, even as retirement gets closer.

If you are thinking about changing your investment option, make sure the move fits your timeline and broader plan, not just your nerves on a volatile day.

The post The superannuation myth that could cost you $100,000 before you retire appeared first on The Motley Fool Australia.

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Motley Fool contributor Leigh Gant 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