Tag: Stock pick

Shares in ASX mineral explorer St George Mining Ltd (ASX: SGQ) have been on a tear in recent months.

Overall, they have risen from $0.02 per share in early January to $0.10 apiece at the time of writing.

This marks a spectacular 400% jump in less than a year.

For context, the All Ordinaries Index (ASX: XAO) has increased by about 3.7% during the same period.

A key catalyst for this ascent has been the company’s pivot into rare earths.

At the start of 2025, the ASX mining stock locked in the acquisition of its Araxá rare earths and niobium project in Brazil.

Since then, results from a series of exploration works have propelled St George onto the radar.

In particular, the group reported several rich intercepts of rare earths and niobium from exploration drilling, while also delivering a maiden mineral resource estimate at the project.

And the potential of Araxá didn’t go unnoticed amongst the movers and shakers of the mining industry.

Just last month, Australia’s richest person, Gina Rinehart, headlined a $72.5 million capital raising designed to move Araxá closer to production.

Here, the mining tycoon invested $22.5 million in St George through her private company, Hancock Prospecting.

And so far, Rinehart’s investment appears to be bearing fruit.

What happened?

This morning, St George announced that thick and high-grade rare earths and niobium drill intercepts at Araxá have continued to expand the mineralised envelope.

More specifically, results from the latest six drill holes have confirmed consistent, shallow, and rich mineralisation outside of the current mineral resource.

St George Executive Chairman, John Prineas, commented:

These drilling results are exceptional and highlight the unrivalled quality of the thick, high-grade mineralisation at our Araxá Project. Significantly, the mineralisation remains open laterally in all directions and at depth.

As things stand, the “world class” resource at Araxá contains 1.7 million tonnes of total rare earths oxide (TREO) and 280,000 tonnes of niobium.

According to St George, it is already the largest and highest-grade carbonatite-hosted rare earths resource in South America.

However, the ASX mining stock believes the latest drill results could now potentially support a large expansion of the existing mineral resource estimate (MRE).

Prineas added:

All resource expansion holes and resource definition holes have demonstrated consistent continuity and grade, giving us confidence that this drill campaign will transform the scale of the MRE, redefine the value of our company and further position St George as one of the leaders in the rare earths and niobium sectors.

What next for this ASX rare earths stock?

Results from another 29 holes that have already been drilled remain pending.

Furthermore, the drilling campaign is ongoing as three rigs pepper Araxá in search of rare earths and niobium mineralisation.

In total, 40 more holes are planned as part of the current program.

St George expects to release the drill results over the coming weeks.

The ASX mining stock is also targeting an upgraded resource estimate for Araxá by the first quarter of next year.

The post Up 400% in 2025! This Gina Rinehart-backed ASX rare earths stock just delivered some big news appeared first on The Motley Fool Australia.

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Motley Fool contributor Bart Bogacz 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.

There are a lot of ASX shares to choose from on the Australian share market.

To narrow things down, let’s look at what Morgans is saying about a few popular options following recent updates. Here’s what it is recommending:

James Hardie Industries plc (ASX: JHX)

Morgans was pleased with this building products company’s recent quarterly update, noting that its performance and outlook were more positive than expected.

As a result, the broker has upgraded its shares to a buy rating with a $35.50 price target. It said:

Whilst the headline 2QFY26 result was largely released in early Oct-25, the details and outlook were incrementally more positive than previously anticipated. Upgraded guidance reflects a c.6% organic decline (vs pcp), as a challenging environment sees volume declines exceed price increases.

However, this is better than feared and may prove to be a bottoming in the cycle as demand stabilises. JHX is trading on c.17.1x FY26F as the business navigates its acquisition missteps, earnings downgrades and a challenging consumer environment in North America (NA). However, at EPS of c.U$1.04/sh in FY26 we see upside from both earnings and an undemanding PER (ave PER. 20x). It is on this basis we upgrade to a BUY recommendation and $35.50/sh target price.

Reece Ltd (ASX: REH)

This plumbing parts company also delivered a quarterly update that was better than expected.

However, Morgans highlights that the worst is not necessarily over for Reece, with its margins and earnings under pressure from higher costs.

In light of this, it has only upgraded its shares to a hold rating with an $11.25 price target. It said:

REH provided a trading update at its AGM. 1Q26 sales were stronger than anticipated, supported by contributions from an expanded branch network across both ANZ and the US. However, earnings and margins remain under pressure due to higher costs. Management expects soft market conditions to persist in both ANZ and the US. We increase FY26-28F sales by 7%, while EBIT remains largely unchanged (+1%). Our estimates also incorporate the recent off-market buyback. Our target price rises to $11.25 (from $11.10).

With a 12-month forecast TSR of 5%, we upgrade our rating to HOLD (from TRIM). While we continue to view REH as a fundamentally strong business with a good culture and a long track record of growth, the operating environment remains challenging, particularly in the US where competitive pressures persist. Trading on 24.2x FY26F PE with a 1.6% yield, we see the stock as fully valued and prefer to wait for signs of market improvement before reassessing our view.

TechnologyOne Ltd (ASX: TNE)

Finally, enterprise software provider TechnologyOne released a full year result that was in line with Morgans’ expectations.

And while its annualised recurring revenue (ARR) may have been a touch softer than expected, the broker feels the negative share price reaction has been overdone. As a result, it has upgraded its shares to an accumulate rating with a $34.50 price target. It said:

TNE’s FY25 result was largely in line with our expectations with the group delivering, PBT growth of +19% to $181.5m ahead of its 13-17% guidance range, and in line with consensus. The negative share price reaction appears to have been driven by softer than expected ARR/NRR print, which saw a 2% miss to ARR growth expectations vs consensus, despite this, the group continues to deliver, with ARR of $554.6m (+18% YoY), which along with its NRR growth of 115% continues to see TNE Ontrack to achieve its long-term ARR growth aspirations.

We modestly pare our EPS forecasts by 1-3% in FY26-28F. and move to an ACCUMULATE rating, with our target price $34.50 now reflecting a TSR of +19% following TNE’s post result share price movement.

The post Buy, hold, sell: James Hardie, Reece, and TechnologyOne shares appeared first on The Motley Fool Australia.

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• Here are the top 10 ASX 200 shares today
• Brokers name 3 ASX shares to buy today

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

Keen to get exposure to the mining sector but don’t feel confident picking individual stocks?

Never fear, there is a simple way, via entities listed on the ASX, that you can buy into the strong performance of our resources winners without the risk and complexity of picking your own shares to buy.

One method is by buying exchange traded funds (ETFs), which aim to track the performance of a basket of shares, and another way is by not investing in the companies themselves, but in the royalty streams they generate.

Gold ETF a winner

If you’re keen on tracking the performance of mining companies themselves, one option is the Betashares global gold miners ETF (ASX: MNRS) ETF.

This particular ETF aims to track an index of the world’s largest gold mining companies, and if you’ve been paying attention to the gold price over the past year, you’d assume correctly that an investment in this vehicle has paid off handsomely.

While a hiccup in the price of gold’s seemingly inevitable march higher has meant MNRS has fallen 5.8% over the past month, looking further back, it’s delivered a whopping 82.5% over the past year and a compound 15.6% over the past five years.

Some of the major holdings in the MNRS ETF include Barrick Gold Corp at 9.1%, Newmont Corporation (ASX: NEM) at 7.4%, and Agnico Eagle Mines also at 7.4%.

A slightly different vehicle is Betashares Global Royalty ETF (ASX: ROYL), which tracks the royalty streams generated by not only resources companies, but also companies with strong intellectual property holdings, and royalty financing arrangements.

While ROYL’s largest holding is in Wheaton Precious Metals Corp, its second largest holding is in Universal Music Group, and it also holds a stake in Royalty Pharma Plc.

ROYL would be useful for investors seeking a regular income stream, as it pays out a distribution each month.

The fund’s performance over the past year has been 25.8%, while looking further back, it has delivered compound annual growth of 21.1% over five years.

More mining royalty streams

And lastly there is Deterra Royalties Ltd (ASX: DRR), which holds the rights to a number of royalty streams in sectors such as iron ore, gold, and lithium.

The company says its benefit lies in gaining direct exposure to commodity price upside, without the risk associated with project development or operating cost issues.

At the end of FY25, the company held 28 royalties and “royalty-like assets” across 11 countries and six commodities, according to its annual report.

The report goes on to say:

With revenue-producing assets, and investments in projects across the development cycle, Deterra couples strong, consistent revenue streams with significant near, medium and long-term optionality.

Deterra’s total shareholder return over the past year has been 7.4%, while over a five year period, it has been 2.2%, according to data sourced from CMC Markets.

Currently, it is offering a fully-franked dividend yield of 5.77%, according to the ASX website.   

The post How to take the guesswork out of getting exposure to the mining sector appeared first on The Motley Fool Australia.

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• Why are ASX gold shares and ETFs soaring today?
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Motley Fool contributor Cameron England 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 certainly has been a very tough time for DroneShield Ltd (ASX: DRO) shares.

After hitting a record high of $6.71 in October, the counter drone technology company’s shares have lost 75% of their value and currently trade at $1.68.

While this is disappointing for shareholders, it could be a buying opportunity for the rest of us according to one analyst.

Should you buy the dip?

This morning, investment advisory and portfolio management company, MPC Markets, named DroneShield shares as a buy, courtesy of The Bull.

It believes that the company’s shares are now trading at a “reasonable price” given its strong growth potential. MPC Markets said:

The company provides artificial intelligence based platforms for protection against advanced threats, such as drones and autonomous systems. The shares had enjoyed a strong run, rising from 76 cents on January 3 to close at $6.60 on October 9, driven by new deals with foreign governments and growth forecasts. The shares fell to $2.25 on November 13 and were trading at $2.095 on November 19.

Investors sold their shares after disclosures to the ASX revealed DRO directors had been selling their holdings. The company generated strong revenue in the third quarter of fiscal year 2025 and has a strong contract pipeline across government and military sectors. The shares are trading at a reasonable price for a company with growth prospects.

Is anyone else bullish on DroneShield shares?

The team at Bell Potter remains very bullish on the counter drone technology company and is recommending it to clients.

Earlier this month, the broker reiterated its buy rating and $5.30 price target on its shares. Based on its current share price, this implies potential upside of 215% over the next 12 months.

The broker believes that DroneShield is well-placed to win significant contracts from its $2,550 million sales pipeline over the coming quarters. It said:

We believe DRO has the market leading counter-drone offering and a strengthening competitive advantage owing to its years of experience and large R&D team, focused on detect and defeat capabilities. We expect 2026 will be an inflection point for the global counter-drone industry with countries poised to unleash a wave of spending on soft-kill detect and defeat solutions. Consequently, we believe DRO should see material contracts flowing from its $2,550m potential sales pipeline over the next 3-6 months as defence budgets roll over to FY26.

The post Why DroneShield shares could rise a massive 200% appeared first on The Motley Fool Australia.

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Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended DroneShield. 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 All Ordinaries Index (ASX: XAO) is up 1.1%, with this fast-rising ASX All Ords gold stock outperforming again today.

The outshining gold miner in question is Gorilla Gold Mines Ltd (ASX: GG8).

Gorilla Gold shares closed on Friday trading for 37 cents. In late morning trade on Monday, shares are changing hands for 38 cents apiece, up 2.7%.

With the gold price trading fairly close to Friday’s levels, currently at US$4,066.35 per ounce, the ASX All Ords gold stock looks to be catching tailwinds today following a promising exploration update.

Here’s what’s happening.

ASX All Ords gold stock lifts off 

Investors are bidding up Gorilla Gold shares after the company reported positive results from metallurgical test work on samples from recent drilling at its Mulwarrie Project, located in Western Australia.

According to the release, the ASX All Ords gold stock achieved an average gold recovery of 93% across all samples by utilising a 106 micron grind, gravity recovery, and 48hr leach kinetics, at an average sample grade of 3.6 grams of gold per tonne (g/t Au).

Those results included a maximum recovery of 98.5% and an average gravity recovery of 44.5%.

And resource growth drilling has kicked off again, with Gorilla Hold deploying one reverse circulation (RC) rig and one diamond drill (DD) rig at Mulwarrie. The rigs will initially target along strike to the south and at depth near previous strong gold intercepts.

Gorilla Gold also has three rigs operating at its Comet Vale project, located 60 kilometres from Mulwarrie. That exploratory drilling is intended to underpin the next mineral resource estimate (MRE) update after the one already scheduled for December.

What did management say?

Commenting on the results boosting the ASX All Ords gold stock today, Gorilla Gold CEO Charles Hughes said, “We are delighted with these initial metallurgical test work results, which confirm the ability to achieve exceptional gold recoveries on mineralised samples from Mulwarrie using industry-standard gold milling processes.”

Hughes added:

This is an important de-risking step for the Mulwarrie Project as we begin detailed study work to evaluate development options on the current Mineral Resource of 350,000 ounces at 3.6g/t Au. Further detailed metallurgical work is currently being planned and will be undertaken as part of the next stage of study work…

We see clear potential substantially expand the overall Mulwarrie MRE by the time of the next resource update next year whilst also significantly increasing the indicated component of the resource.

With today’s intraday lift factored in, the Gorilla Gold share price is up 52.5% in 2025.

The post Guess which ASX All Ords gold stock is lifting off today on ‘excellent recoveries’ appeared first on The Motley Fool Australia.

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• 3 reasons to buy this surging ASX All Ords gold stock today

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.

Shares in Qube Holdings Ltd (ASX: QUB) have rocketed to a record high after the company announced that Macquarie Asset Management had launched a takeover bid for the company.

Macquarie Asset Management (MAM) is offering $5.20 per share for the logistics provider, well above its last trading price of $4.07 and substantially more than the shares’ highest level over the past 12 months of $4.59.

Qube shares jumped 16.7% to be changing hands for $4.75 early on Monday.

The takeover bid is conditional on several matters, including satisfactory due diligence and a unanimous recommendation for the Qube board.

Board backs the deal

The board said in a statement to the ASX on Monday that it had granted Macquarie a period of exclusive due diligence until 1 February.

The company said further:

The proposal follows an earlier unsolicited, non-binding and indicative offer at a lower value and a period of negotiation, which included the provision of limited due diligence information to facilitate a meaningfully improved proposal from MAM. After careful evaluation of the Proposal, the Board of Qube determined it appropriate to enter into a Process Deed with MAM. The Process Deed grants MAM a period of exclusive due diligence access from the date of the deed until 1 February 2026.   

The Qube board has indicated that, at this stage, the directors intend to unanimously support the proposal in the absence of a better offer and subject to an independent expert’s report concluding that the deal is in the best interests of shareholders.

Qube Chair John Bevan said:

The proposal from Macquarie Asset Management is a reflection of the strength of Qube’s business model and our assets, and the quality of our people and culture. We look forward to continuing to engage constructively in the best interests of our shareholders.

Under the agreement announced to the ASX on Monday, the Qube board has also agreed to allow MAM to match any competing bid that might arise.

Qube travelling well

Qube last financial year reported record underlying revenue of $4.46 billion, up 27.3%, and lifted its fully franked dividend by 7.1% to 9.8 cents per share.

Managing Director Paul Digney told the company’s recent annual general meeting that in the first quarter of the current financial year, the company’s performance across all markets had been in line with expectations.

Based on the performance to date, the company was expecting to deliver “solid” underlying earnings per share and net profit growth over the full year, Mr Digney said.

The company did receive a high vote against its remuneration report, with the votes against its adoption coming in at 18.3%.

The post Qube shareholders sitting pretty after Macquarie takeover bid launched appeared first on The Motley Fool Australia.

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• Qube Holdings holds AGM after hitting record earnings in FY25

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

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

After a sharp rally in recent months, Apple (NASDAQ: AAPL) shares look expensive. The iPhone maker’s stock has climbed to fresh highs, reflecting investors’ growing confidence that the company has emerged from its growth lull and is heading into a stronger product and earnings cycle.

Apple is still a hardware-focused business, but the story now leans more on services and the steady influence of its installed base. That shift, together with a clearer artificial intelligence road map, helps explain why the stock still carries a premium valuation.

1. Growth is back on track

After a sluggish stretch last year, Apple’s revenue has begun to reaccelerate. Revenue grew 4%, 5%, 0%, and then 8% year over year across the four quarters of fiscal 2025 (respectively), lifting full-year growth to more than 6% from just 2% growth in fiscal 2024.

Importantly, this accelerated growth was driven by both hardware and services revenue.

2. A powerful iPhone 17 cycle

The current iPhone 17 cycle is a key driver of that rebound. iPhone revenue grew double digits year over year in the third quarter of fiscal 2025 and increased again in the fourth quarter as the new iPhone 17 lineup launched. Of course, the new iPhone models were available only for a few weeks during the fiscal fourth quarter. So, the real test will be during the important holiday period, which aligns with Apple’s first quarter of fiscal 2026 (the current quarter).

But based on management’s comments on the latest iPhone models in the company’s fiscal fourth-quarter earnings call, we already know the iPhone 17 is probably going to do well this holiday season. “We’re constrained today on several models of the iPhone 17,” said Apple CEO Tim Cook in the company’s latest earnings call. “There’s not a ramp issue. It’s just we have very strong demand and we’re working very hard to fulfill all the orders that we have.”

In addition, management specifically guided for double-digit year-over-year growth in iPhone revenue for the period.

3. Services tilt the business toward higher margins

Apple’s important services business, which is home to the App Store, Apple’s native apps like Apple Music and Apple TV, and other services such as AppleCare, continues to grow faster than the rest of the company and carries a much higher gross margin than hardware sales. In the fourth quarter of fiscal 2025, services revenue grew 15% year over year, compared with 8% for the company as a whole. In addition, the important segment represented close to 30% of total revenue during the quarter.

That shift toward recurring revenue sources in Apple’s services business, including app store fees, cloud storage, payments, advertising, and subscriptions, should make Apple’s business more resilient and — importantly — more profitable. After all, Apple’s services business commands a gross margin of about twice that of the company’s hardware business.

4. Guidance signals more momentum

Management’s outlook adds another pillar to the bullish case. For the current quarter ending in December, Apple expects total revenue to grow 10% to 12% year over year, and iPhone revenue to grow at a double-digit rate.

Viewing this guidance in light of the company’s recent acceleration in the back half of fiscal 2025, that guidance suggests the current momentum is not just a one-quarter blip tied to product timing but something more sustainable.

5. AI as a future catalyst

The final reason many investors remain comfortable owning Apple at a premium multiple is the potential for artificial intelligence (AI) to drive another hardware upgrade cycle. Apple has talked more openly this year about integrating AI across devices, from on-device models that power smarter photo and messaging features to a revamped Siri expected in 2026.

The company has begun to ramp up capital spending and AI-related research and development. If AI features start to require more powerful devices better suited for fast-changing computing needs, Apple is positioned to capture that demand through new products in existing product lines and potentially even entirely new product lines enabled by AI.

Taken together, these five pillars help explain why the market is willing to pay a rich price for Apple shares and why I personally remain bullish on the stock over the long haul.

Trading at around 32 times forward earnings, the stock isn’t cheap, and any unexpected setbacks in iPhone demand or services growth could pressure that multiple — especially if AI initiatives disappoint. Still, I believe the upside opportunity outweighs the risks.

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

The post 5 reasons I still love Apple stock, even after it soared higher appeared first on The Motley Fool Australia.

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

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Daniel Sparks and his clients have positions in Apple. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Apple. The Motley Fool Australia has recommended Apple. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

If you are wanting to supercharge your portfolio, then it could be worth turning to WiseTech Global Ltd (ASX: WTC) shares.

That’s because analysts at Bell Potter believe they could deliver huge returns over the next 12 months.

What is the broker saying about the tech stock?

Bell Potter highlights that the logistics solutions technology company held its annual general meeting last week and reaffirmed its guidance for FY 2026. It was pleased with the update and sees it as the first hurdle cleared. It said:

WiseTech held its AGM today and reaffirmed its FY26 guidance of revenue b/w US$1.39-1.44bn, EBITDA b/w US$550-585m and EBITDA margin b/w 40-41%. The company also flagged that the new commercial model will go live on 1st December and “a large number of customers” are expected to transition on that date.

There was, however, little update on the launch of Container Transport Optimisation (CTO) with only the comment “we are focused on our initial launch of CTO with revenue generation commencing during the year.” WiseTech also flagged its upcoming investor day on 3rd December and said it will provide details on “the rollout of our new commercial model, and progress relating to CTO and the e2open integration.”

In response to the meeting, the broker has trimmed its estimates modestly. Nevertheless, it believes WiseTech Global will meet its guidance this year. It adds:

We have modestly downgraded our EBITDA forecasts in FY26, FY27 and FY28 by 1%, 2% and 2% mainly for conservatism. The downgrades have been driven by 2-3% reductions in our revenue forecasts which has been partially offset by increases in our margin forecasts. In FY26 we now forecast revenue and EBITDA of US$1.40bn and US$569m which is towards the lower end of the guidance range for the former and close to the middle for the latter.

That is, we see more risk at revenue than EBITDA this year, particularly with the greater-than-usual revenue skew to H2. Any weakness or miss at revenue, however, we would expect to be offset by a stronger margin.

WIseTech Global shares tipped to rise

According to the note, the broker has retained its buy rating on the company’s shares with a reduced price target of $100.00.

Based on the current WiseTech Global share price of $69.05, this implies potential upside of 45% for investors over the next 12 months. It concludes:

The next potential catalyst is the upcoming investor day and, in particular, any details around the launch of the new commercial model. A high uptake of the CargoWise Value Pack, for instance, would be bullish in our view.

The post Why WiseTech Global shares could rise 45% in a year appeared first on The Motley Fool Australia.

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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.

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

Nvidia (NASDAQ: NVDA) stock has roared higher over the past several years as artificial intelligence (AI) emerged as a game-changing technology. The company designs the most powerful AI chips around — they’re known as graphics processing units (GPUs) and are key to the development and use of AI. So, the idea is, if you invest in Nvidia, you’ll benefit as this technology revolution marches on.

The company has demonstrated this as AI, for the past few years, already has been supercharging its revenue growth. Nvidia has reported double- and triple-digit gains quarter after quarter, and the stock price has taken off too, advancing 1,200% over the past five years.

But, as this has unfolded, valuations of Nvidia and other AI players have climbed too, prompting investors to worry about the potential formation of an AI bubble. And this concern has weighed on the S&P 500 and Nvidia in recent weeks — they declined more than 2% and 7%, respectively, from the start of November through the Nov. 19 market close.

Are Nvidia and other AI stocks in a bubble? Here’s what Nvidia chief Jensen Huang says.

The message from other tech giants

Before we zoom in on Huang’s comments, though, let’s take a quick look at the current AI picture. Though some investors have worried about an AI bubble, we haven’t seen evidence of a slowdown in demand for AI products and services. Tech giants from Amazon to Alphabet and Broadcom all have reported earnings over the past several weeks — and each one has spoken of high demand for AI products and services.

Cloud service providers are building out infrastructure to keep up with this soaring demand — and this has been driving their revenue growth as well as growth at chip companies such as Nvidia, Broadcom, and Advanced Micro Devices. All of this supports Huang’s prediction, delivered a few months ago, for as much as $4 trillion in AI infrastructure spending by the end of the decade.

As mentioned, though, as investors piled into AI stocks, valuations climbed. The S&P 500, as seen through the S&P 500 Shiller CAPE ratio, has been trading at one of its most expensive levels ever. And this has prompted some investors to start thinking about the possibility of an AI bubble taking shape.

Why Huang’s view is key

Now, let’s consider what Nvidia’s Huang has to say about the matter. He, as the leader of a company with great visibility on what’s happening next in the AI market, is well-positioned to address this subject. After all, Nvidia is in close contact with its customers as they plan future orders, so the chip giant sees if momentum is slowing or set to continue.

Huang, during Nvidia’s earnings call on Wednesday, said the following:

“There’s been a lot of talk about an AI bubble. From our vantage point, we see something very different.”

The idea is that, though a company such as Nvidia has seen tremendous growth in recent years, we are still in the early days of the AI boom. Huang sees three major shifts in progress: the transition from central processing unit (CPU) computing to GPUs, the broad use of generative AI, and the growing use of agentic AI systems. And these, all requiring AI products and services, should keep powering earnings higher at Nvidia.

“Our singular architecture enables all three transitions,” Huang added.

Nvidia’s revenue climbs 62%

Nvidia’s fiscal 2026 third-quarter earnings reinforce all of this. The company reported a 62% increase in revenue to a record level of $57 billion and maintained high profitability on sales, with gross margin of more than 73%. And the demand picture looks bright too, with Nvidia saying its installed base of GPUs is in use at 100% and “the clouds are sold out.”

Considering all of this, Nvidia, trading for around 40x forward earnings estimates, looks reasonably priced.

So, today, in the wake of Nvidia’s earnings report, investors may breathe a sigh of relief as Huang offers evidence that the top AI stock isn’t in a bubble — and instead could continue to deliver growth well into the future as the AI boom evolves.

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

The post Is Nvidia in an AI bubble? Here’s what Jensen Huang says. appeared first on The Motley Fool Australia.

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

More reading

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• Does the AI revolution justify today’s high ASX 200 valuation?
• Nvidia stock in an AI bubble? The AI giant’s fantastic Q3 results and guidance should put that concern to rest
• Bitcoin price collapse leads US$1 trillion crypto crash
• Why are ASX 200 tech stocks getting smashed on Friday?

Adria Cimino has positions in Amazon. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Alphabet, Amazon, and Nvidia. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has recommended Broadcom. The Motley Fool Australia has recommended Alphabet, Amazon, and Nvidia. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

ASX dividend share Metcash Ltd (ASX: MTS) has sparked renewed interest among income-focused investors. Over the past 12 months, the share price has increased by 21%, although it has slowed down slightly in the past month.

With solid operational momentum, improving cash flow and attractive dividend yields, the wholesale distribution heavyweight is emerging as a compelling pick if you’re after passive income.

Resilient food and liquor distribution

Metcash’s diversified business – spanning food, liquor, and hardware divisions – is showing strength. The food and liquor divisions are resilient, as they distribute food and liquor to hundreds of independent retailers across Australia, including IGA, Cellarbrations, IGA Liquor, The Bottle-O, Porters, and Thirsty Camel.

The ASX dividend share also operates a foodservice component, which supplies commercial customers, including hotels, restaurants, cafes, and others.

Softer market hits hardware division

Metcash is also the second-largest player in the Australian hardware market, as it owns businesses such as Mitre 10, Home Hardware, and Total Tools. The hardware business has gone through a few difficult years because of weak construction activity. Now, it looks like things might turn around.

After a challenging FY25, analysts are projecting that the company’s earnings could increase by approximately 10% to $300 million in FY26 (and another 10% in FY27).

The latest trading update was a step in the right direction. In the 18 weeks to 31 August 2025, total sales excluding tobacco increased 5.1% (or 1.1% including tobacco). Total food sales were up 8.6% excluding tobacco sales, total liquor sales were up 1.5%, and Total Tools and Hardware Group sales were up 1.8%.

Reliable payouts

On the income reliability front, Metcash has paid two fully franked dividends every year since 2017. The business pays around 70% of its underlying net profit as a dividend, which led to a total dividend per share of 18 cents in FY25. That translates into a trailing grossed-up dividend yield of 6.75%, including franking credits.

UBS projects the ASX dividend share to increase its payout every year between FY25 to FY29. That could be great news for investors focused on passive income.

Most analysts also predict moderate to strong upside from Metcash’s share price of $3.76 at the time of writing. They have set an average price target of $4.30, which suggests a share price gain of 15%. That could lift total Metcash earnings, including dividends, past the 20% mark.  

Broker Shaw and Partners sees the ASX dividend share as a good option for income investors, but it only rates it as a hold. It notes:

We suggest holding Metcash for stable income and defensive positioning. It offers a solid dividend yield, resilient earnings and reliable cash flow in uncertain markets. Its exposure to essential consumer goods and regional retail provides downside protection, making it a suitable hold for income-focused investors seeking stability over aggressive growth.

The post Up 21% this year! This fast-recovering ASX dividend share might not be a bargain forever appeared first on The Motley Fool Australia.

More reading

• Why did the ASX 200 dive to a near six-month low last week?
• 2 ASX blue-chip shares offering big dividend yields

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 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.