Tag: Stock pick

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

Warren Buffett and Michael Burry are two of the most famous investors in modern history. While both have amassed enormous wealth, they share little in common when it comes to their respective investment strategies.

This dichotomy is on full display at the moment, as recent 13F filings reveal that Burry is shorting artificial intelligence (AI) stocks Nvidia (NASDAQ: NVDA) and Palantir Technologies (NASDAQ: PLTR), while Buffett just plowed more than $4 billion into Alphabet (NASDAQ: GOOGL) (NASDAQ: GOOG).

Let’s break down the underlying features of their latest moves in an attempt to assess which billionaire made the right choice, and to answer the question: Should you buy or sell AI stocks right now? 

Michael Burry’s latest big short

In simple terms, when an investor shorts a stock, they are betting that its price will decrease. One common way to construct a short trade is to buy put options on the stock you’re bearish about.

According to the most recent 13F filing from Scion Asset Management, the hedge fund Burry manages, during the third quarter, it purchased 5 million shares worth of put options for Palantir and 1 million put options for Nvidia. In total, these contracts are worth roughly $1.1 billion.

In my view, there are two primary reasons Burry went short on those stocks in particular.

With Palantir, Burry’s concern is likely its lofty valuation. As of Nov. 19, Palantir sported a price-to-sales (P/S) ratio of 107. Not only is this a hefty premium for the software sector, but it is also historically high when benchmarked against prior technology megatrends.

For instance, during the height of the dot-com bubble, the P/S ratios of internet pioneers such as Microsoft, Cisco, and Amazon peaked in the range of 30 to 50. Given how much further Palantir’s valuation has climbed beyond those excessive levels, it could be argued that the data analytics specialist is due for a pullback. Its current valuation appears unsustainable.

With Nvidia, Burry’s concerns are tied to a more subtle detail. The chipmaker is the market leader in graphics processing units (GPUs), advanced parallel processors that are widely used to develop and power generative AI applications.

Over the last few years, hyperscalers have laid out hundreds of billions of dollars to buy as many of Nvidia’s GPUs as possible. Where things become more complicated is how all this hardware is being accounted for on paper.

Let’s say a company expects the GPUs it buys to have a useful life of five years. If it spent $1 billion in a given year to procure these chips, then the business would generally depreciate this purchase ratably — in five annual installments of $200 million — over that estimated useful life. Because depreciation is treated on the books as an expense, that theoretical depreciation figure of $200 million will cut into the company’s reported earnings each year. This lowers its bottom-line figure for that year accordingly.

In reality, however, Nvidia has been releasing new chip architectures every other year since before the AI revolution kicked off, and in 2024, it accelerated its pace to an annual cadence. Against this backdrop, the true product life cycle of its GPUs might be only two or three years.

For now, though, with companies depreciating these expenses over longer horizons — five or six years, in some cases — they reduce the size of the annual expenses they have to report relative to depreciation, which makes their profits appear higher.

Burry is essentially accusing Nvidia and its customers of accounting fraud supported by artificially inflated profit margins.

The one magnificent stock Buffett just bought

During the third quarter, the only stock that Buffett and his portfolio managers added to Berkshire Hathaway‘s portfolio was Alphabet.

This was an interesting move, as Buffett had been trimming technology positions such as Apple for more than a year. Moreover, Berkshire has kept its stock purchases fairly muted recently, so its sales left it with a record cash stockpile.

In Q3, for the first time since the AI revolution began, the Oracle of Omaha finally decided to partake. Adding to the curiosity, Alphabet arguably sits at the intersection of Burry’s two concerns — valuation and accounting gimmicks.

On the valuation side, Buffett is notorious for not chasing hype or paying premium prices for investments. Given that the S&P 500‘s Shiller CAPE ratio level of 40 is dangerously close to levels last seen during the dot-com bubble, a solid argument could be made that the market isn’t just frothy — it’s overvalued. And AI stocks are the largest contributors to that condition.

S&P 500 Shiller CAPE Ratio data by YCharts.

Even so, Alphabet trades at a forward price to earnings (P/E) multiple of 28 — the second-lowest among the “Magnificent Seven.” With that in mind, shares of Alphabet could be seen as somewhat of a value play relative to the rest of its cohort.

When it comes to the accounting issues, I don’t think Buffett is too concerned. He’s a high-level thinker. What I mean by that is Buffett made his fortune investing in durable businesses that generate consistent profits and reward shareholders through dividends and stock buyback programs.

In other words, Buffett does not appear to be overly analytical when it comes to the specifics of a company’s generally accepted accounting principles (GAAP) financial reporting. The team at Berkshire is likely well aware of the accounting mechanisms employed by big tech, and it’s more than able to adjust its own models to perform what it views as accurate forecasting.

The verdict: Buffett and Burry have different mindsets

At the end of the day, Buffett and Burry are taking different approaches to the AI trade.

While both are contrarian investors, Burry should be thought of as a trader — he looks to identify anomalies or momentum opportunities that he can capitalize on. By contrast, Buffett invests for longer periods in businesses that have brand recognition and diverse ecosystems.

As a long-term investor, I am more inclined to follow Buffett’s playbook. Choosing companies to buy and hold forever is a proven, time-tested approach to compounding wealth.

While Burry may mint some short-term profits by betting against the AI pure plays, I think Buffett is better positioned for long-term gains. 

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

The post Warren Buffett is buying artificial intelligence (AI) stocks while Michael Burry is shorting them — Who’s right? 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

• Nvidia: There was a red flag in its earnings report, but is the stock still a buy?
• Could the Anthropic partnership be Nvidia’s most important AI deal yet?
• The most jaw-dropping number you may have missed from Nvidia’s latest earnings report
• Is Google about to eat Nvidia’s lunch?
• If you’d invested $100 in Nvidia 10 years ago, here’s how much you’d have today

Adam Spatacco has positions in Alphabet, Amazon, Apple, Microsoft, Nvidia, and Palantir Technologies. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Alphabet, Amazon, Apple, Berkshire Hathaway, Cisco Systems, Microsoft, Nvidia, and Palantir Technologies. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has recommended the following options: long January 2026 $395 calls on Microsoft and short January 2026 $405 calls on Microsoft. The Motley Fool Australia has recommended Alphabet, Amazon, Apple, Berkshire Hathaway, Microsoft, and Nvidia. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

There are a number of compelling top dividend stocks that Aussies can buy for sizeable and growing passive income.

Rising dividends are one of the most important aspects I want to see because that’s the sign of a growing business; it can help offset (and outpace) inflation and deliver more cash to our bank account each year.

The top dividend stock I want to highlight today is Centuria Industrial REIT (ASX: CIP), a real estate investment trust (REIT) that owns a portfolio of industrial properties across Australia.

How to make $200 per month of passive income

Receiving regular passive income is very rewarding due to its ease. Once the shares are bought, we don’t need to do any additional work for those payments.

The Centuria Industrial REIT doesn’t pay monthly, but it does pay quarterly. I think it’s better to think of it as an annual income goal and then divide that figure by 12. To generate $200 of monthly passive income, we’re talking about $2,400 of annual income.

The business expects to pay an annual distribution per unit of 16.8 cents. That translates into a future distribution yield of close to 5% for FY26.

I think that’s a solid starting point and represents a year-over-year increase of 3% compared to the FY24 payout. That level of growth is pleasing to see.

To receive $2,400 in annual passive income, an investor would need to own 14,286 shares of Centuria Industrial REIT.

Why this is an appealing time to buy into the top dividend stock

The business continues to generate strong rental outcomes for investors. For example, it recently signed a new 10-year lease with Tesla, which provided a 133% re-leasing spread for the Derrimut, Victoria asset. In other words, the new rental income is 133% higher than the old contract, boosting future rental profits.

Centuria Industrial REIT also recently pointed out that there’s an opportunity to capture value from some underutilised space, such as the REIT’s well-connected data centre in Clayton, Victoria. This site has the potential for a second data centre next to the Telstra Group Ltd (ASX: TLS) data centre of up to 40MW.  

During the last quarter, it also exchanged sale contracts to divest a property in Bundamba, Queensland, for $11.8 million, which was a 10% premium to the value stated at June 2025.

The REIT’s fund manager, Grant Nichols, said:

CIP continues to achieve strong outcomes across its portfolio relating to leasing, capital transactions and value add initiatives.

The ability to deliver these results is credited to CIP’s portfolio being concentrated in Australia’s urban infill markets where tenant demand is strongest, vacancy is low and supply is constrained. These urban infill assets provides multiple future opportunities for alternative, higher-use developments such as data centres and residential schemes.

The top dividend stock reported net tangible assets (NTA) of $3.92 per unit at 30 June 2025, so at the time of writing, it’s trading at a discount of more than 10%, which I think is very appealing.

The post Buy 14,286 shares of this top dividend stock for $200 per month in passive income appeared first on The Motley Fool Australia.

More reading

• These top ASX dividend stocks offer 5% yields
• Forget term deposits and buy these ASX dividend shares
• 3 super ASX dividend shares to buy for an income portfolio
• I’d buy this ASX dividend stock in any market
• Want to build up income? I believe these 2 ASX 300 shares are a buy

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 Tesla. The Motley Fool Australia has positions in and has recommended Telstra 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.

Nvidia (NASDAQ: NVDA) continued its streak of remarkable revenue growth in its third quarter (ended Oct. 26), as demand for its graphics processing units (GPUs) remains insatiable. However, there was one red flag in its report that investors should be aware of moving forward. Nonetheless, the stock jumped on the results, and it is now up more than 40% on the year.

Let’s dig into Nvidia’s results and prospects to see whether investors should buy the stock or take some profits.

Strong revenue growth, but…

Nvidia once again reported remarkable revenue growth, especially for a company of its size. For its fiscal Q3, its revenue soared 63% to $57 billion, easily topping the $54.9 billion consensus as compiled by LSEG. Adjusted earnings per share (EPS), meanwhile, climbed 67% to $1.30, coming in ahead of the $1.25 analysts expected.

Data center revenue was once again Nvidia’s biggest growth driver in the quarter, with revenue jumping 66% to $51.2 billion, helped by momentum with its Blackwell chips. Within its data center segment, its networking portfolio also once again shone, with revenue surging 162% $8.2 billion. The company credited the growth to its NVLink interconnect solution, as well as its InfiniBand and Spectrum-X Ethernet products. Its report highlighted that Meta Platforms, Microsoft, and Oracle are all building huge AI factories using its Spectrum-X Ethernet switches.

On its call, Nvidia management said it saw no signs of an artificial intelligence (AI) bubble and that demand continues to exceed its expectations. Management noted that its cloud GPUs were sold out and that all generations of its GPUs are being fully utilized.

In a direct counter to famed investor Michael Burry’s bearish argument on the AI infrastructure space, Nvidia also said that its older A100 GPUs that were shipped six years ago were still running at 100% utilization in large part thanks to its CUDA software platform. Burry had argued that the useful life of GPUs is only two to three years. Thus, cloud computing companies were overstating their earnings because their GPUs had been depreciating over the six years.

The company also noted that despite getting a license to sell its H20 chips in China, revenue was minimal in the quarter, with only about $50 million in sales.

Nvidia’s other segments also produced solid results. Gaming revenue jumped 30% to $4.3 billion, while its professional visualization segment sales soared 56% to $730 million. Meanwhile, its automotive segment saw revenue climb 32% to $592 million. The strong auto performance was driven by self-driving solutions and partnerships like the one it established with Uber.

The company continues to be a cash-flow machine, generating operating cash flow of $23.8 billion and free cash flow of $22.1 billion in the quarter. It ended the quarter with cash and marketable securities of $60.6 billion and $8.5 billion in debt after buying back $12.5 billion in stock in the quarter.

Looking ahead, Nvidia guided for Q3 revenue to come in around $65 billion, which would represent 65% growth. The forecast does not assume any data center revenue coming from China.

While the report and guidance were strong, the one red flag with Nvidia’s report was that the company continues to see its accounts receivable balloon. During the quarter, this metric climbed 89% year over year to $33.4 billion, outpacing its sales growth. Accounts receivable is how much money is owed to the company for products that have been shipped. Continued big jumps in this metric can be a sign of channel stuffing or collection problems. Given that Nvidia has started to make investments in its customers, like OpenAI and Anthropic, this makes it even more notable, as the chipmaker is essentially providing the cash these companies need to help buy its chips. This type of circular financing likely isn’t sustainable over the long run. 

Is Nvidia stock still a buy?

While I think investors need to be aware of the potential pitfalls of Nvidia’s circular financing and ballooning accounts receivable issue, I wouldn’t dump the stock yet. The company is still seeing incredible growth and generating a ton of cash. The insatiable demand for its chips is real, and the company has created a wide moat through its CUDA software platform and NVLink interconnect solution, which helps its chips act like one powerful unit.

Whether this red flag becomes a problem in the future will likely come down to OpenAI. The AI model company is looking to spend aggressively on building out AI infrastructure, but it is currently losing money and burning through cash. However, it’s also tied itself to nearly every major player in the AI space, perhaps making it too important to fail. However, this is not something that will play out until years down the road.

In the meantime, I’d expect Nvidia to continue to produce robust growth and continue to be one of the biggest beneficiaries of AI. As such, I view the stock as a buy, with the caveat that I’d continue to monitor this risk.

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

The post Nvidia: There was a red flag in its earnings report, but is the stock still a buy? 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

• Could the Anthropic partnership be Nvidia’s most important AI deal yet?
• The most jaw-dropping number you may have missed from Nvidia’s latest earnings report
• Is Google about to eat Nvidia’s lunch?
• If you’d invested $100 in Nvidia 10 years ago, here’s how much you’d have today
• 3 ASX thematic ETFs that could boom over the next decade

Geoffrey Seiler 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 Meta Platforms, Microsoft, Nvidia, Oracle, and Uber Technologies. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has recommended the following options: long January 2026 $395 calls on Microsoft and short January 2026 $405 calls on Microsoft. The Motley Fool Australia has recommended Meta Platforms, Microsoft, and Nvidia. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

Hub24 Ltd (ASX: HUB) shares have been in focus this week after the investment platform provider held its investor day event.

Bell Potter has been busy running the rule over the update and has given its verdict on the ASX 200 stock.

What did the broker say about this ASX 200 stock?

Bell Potter was pleased with what it heard at the event and highlights the upside risk to funds under administration (FUA) guidance from new initiatives. It said:

We attended the Investor Day, with the biggest take out being early upside risk to FUA guidance as the company continues to broaden its offering and uplift volumes. Mention of continued strong inflows, more advanced than expected and positive clarification for the trustee licence which runs distinct to its custodian. This has been a deliberate and flexible approach, with an embedded option to purchase the business.

On the negative side, the broker notes that the ASX 200 tech stock is expecting its expenses to grow more than originally expected in FY 2026. However, it points out that this is due to management’s plan to outpace rivals, and its EBITDA margin is still expected to improve year on year. It adds:

Outlook for expense growth has been dialled up to +18-20% with the step change primarily in first half. This reflects a deliberate move to outpace peers and bring forward investment. We believe around half relates to variable cost. So, expect to see this mitigated by operational leverage.

Underlying EBITDA margins are still placed to improve YOY. Fixed costs are basically new solutions and revealed myhub, a recent one user login and app switcher with prompts. We got some efficiency metrics such as halving the time taken to produce advice documents vs. industry average. Like an ERP software but prototyping with co-production and beta testing FY26. Production FY27.

Should you invest?

According to the note, the broker has retained its buy rating on the ASX 200 stock with a trimmed price target of $125.00 (from $135.00).

Based on its current share price of $103.70, this implies potential upside of 20% for investors over the next 12 months.

Commenting on its buy recommendation, Bell Potter said:

Negative surprise in the expense guidance, but we left confident in the growth outlook and cadence over peers. More than mitigated from scale and entrenches customers in line with our initial thesis. Adviser efficiency has historically benefitted flows/valuation.

The post Why this ASX 200 tech stock could rise 20% appeared first on The Motley Fool Australia.

More reading

• Here are the top 10 ASX 200 shares today
• 3 ASX dividend machines I think will keep paying for decades
• Brokers name 3 ASX shares to buy today
• 3 of the best ASX ETFs for beginners to buy with $1,000
• 3-month suspension: What’s going on with Corporate Travel shares?

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 Hub24. The Motley Fool Australia has recommended Hub24. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

The post Here are the top 10 ASX 200 shares today appeared first on The Motley Fool Australia.

More reading

• Brokers name 3 ASX shares to buy today
• What’s driving the dramatic drop in ASX 200 tech shares?
• Why HMC Capital, Select Harvests, Web Travel, and WiseTech shares are pushing higher today
• Buying ASX shares? Here’s what to know before the RBA starts hiking interest rates
• A Black Friday stock tip for free

Motley Fool contributor Sebastian Bowen 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 HMC Capital, Temple & Webster Group, and WiseTech Global. The Motley Fool Australia has positions in and has recommended WiseTech Global. The Motley Fool Australia has recommended Flight Centre Travel Group, HMC Capital, and Temple & Webster Group. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

If you’re building a portfolio designed to deliver steady, long-lasting passive income, the best approach is to focus on companies with robust business models, durable earnings and management teams that consistently prioritise shareholder returns.

These aren’t the headline-grabbing tech names, they are the quiet compounders that keep paying through booms, busts, and everything in between.

Right now, three ASX shares stand out as true dividend machines. They offer stability, defensive cash flows, and the kind of long-term reliability income-focused investors value most.

APA Group (ASX: APA)

APA Group could be one of the most dependable income stocks on the Australian market. It owns and operates Australia’s largest network of gas pipelines along with electricity transmission, renewable energy, and remote power assets. These are essential infrastructure assets that underpin the nation’s energy system, making APA’s earnings highly predictable.

These assets have allowed APA to deliver over a decade of consecutive dividend increases, which is something only a handful of ASX shares can claim. And with its distributions backed by long-term, inflation-linked contracts that provide excellent visibility on future cash flows, it seems quite likely that this run could continue well into the next decade.

At present, APA Group trades with an estimated forward dividend yield of 6.25%.

Macquarie Group Ltd (ASX: MQG)

Another ASX dividend share that could be a great long-term income pick is Macquarie.

It is an investment bank that has a unique global business model spanning asset management, commodities, banking, and green energy investments. This diversification allows it to generate income from multiple sources, reducing reliance on any single segment.

Macquarie arguably has one of the strongest capital positions in the financial sector, supporting its long history of paying meaningful dividends. The company also benefits from long-term structural trends such as the energy transition, infrastructure investment, and global asset management flows. This bodes well for its dividends over the next decade.

It currently trades with an estimated forward dividend yield of 3.55%.

Transurban Group Ltd (ASX: TCL)

Toll-road operator Transurban is another reliable income generator worth considering.

Its network of roads across Sydney, Melbourne, Brisbane and North America generates steady, inflation-linked revenue.

Transurban appears well-placed for steady and predictable growth over the next decade thanks to population growth, traffic congestion, and development projects.

This is expected to support further increases in its dividend. For example, the market expects an increase to 69 cents per share in FY 2026 (from 65 cents in FY 2025), which equates to a forward dividend yield of 4.6%.

The post 3 ASX dividend machines I think will keep paying for decades appeared first on The Motley Fool Australia.

More reading

• Why Amcor, DroneShield, Harvey Norman, and QBE shares are falling today
• It’s time to buy: 1 Australian stock that hasn’t been this cheap in years
• How to retire early with ASX shares and the power of compounding
• 3 ultra-reliable ASX dividend stocks I’d buy for long-term income
• These ASX 200 shares could rise 40% to 90%

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

It has been another busy week for many of 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 right now:

Electro Optic Systems Holdings Ltd (ASX: EOS)

According to a note out of Bell Potter, its analysts have retained their buy rating on the defence and space company’s shares with a trimmed price target of $8.10. This follows news that the company has acquired MARSS Group’s drone interceptor business for $10 million. It notes that interceptor drones are an emerging hard-kill counter-unmanned aerial systems (C-UAS) technology that is expected to grow in demand in the coming years. And while it will take 12-24 months to develop a commercial product, Bell Potter thinks it will be worth the wait. It estimates that interceptor revenue will come in at $6 million in 2027 then grow in the double digits in the years that follow. Outside this, it highlights that EOS is positioned as a market leader in C-UAS solutions and is leveraged to increasing budget allocations to C-UAS technologies. The EOS share price is trading at $4.56 this afternoon.

Nick Scali Limited (ASX: NCK)

Another note out of Bell Potter reveals that its analysts have initiated coverage on this furniture retailer’s shares with a buy rating and $27.00 price target. The broker is feeling positive about Nick Scali’s outlook thanks to its industry leading margins and its expansion opportunity in the UK. Bell Potter highlights that there is scope for the company to triple its store footprint in the UK market, which will be supportive of earnings and dividend growth in the coming years. This is expected to be complemented by growth in the Plush brand in Australia over time. Overall, the broker feels that it is the most attractive goods retailer within the ASX 200 on a growth adjusted basis. The Nick Scali share price is fetching $23.71 at the time of writing.

Web Travel Group Ltd (ASX: WEB)

Analysts at UBS have retained their buy rating and $6.15 price target on this travel technology company’s shares. According to the note, the broker was pleased to see that the WebBeds owner’s growth is considerably stronger than its rival Hotelbeds. In addition, its margins have held up a lot better than its competitor. And while there are risks that its rival could cut prices to boost its growth, UBS isn’t overly concerned and continues to recommend Web Travel to its clients. The Web Travel share price is trading at $4.72 on Friday.

The post Brokers name 3 ASX shares to buy today appeared first on The Motley Fool Australia.

More reading

• Why HMC Capital, Select Harvests, Web Travel, and WiseTech shares are pushing higher today
• Buy alert! Bell Potter says this ASX 200 stock is ‘unmatched’
• Forget Droneshield shares, I’d buy this ASX defence stock instead
• 5 things to watch on the ASX 200 on Friday
• Why EOS shares could rise 75% in just a year

Motley Fool contributor James Mickleboro has positions in Web Travel Group Limited. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Electro Optic Systems. The Motley Fool Australia has recommended Nick Scali. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

Getting started in the share market doesn’t need to be scary.

Not when there are exchange-traded funds (ETFs) out there that make investing far easier.

With a single trade, you can buy a diversified basket of shares rather than trying to pick individual winners.

If you are starting out with $1,000 today, these three ASX ETFs could be well worth considering. Let’s see why:

BetaShares Australian Quality ETF (ASX: AQLT)

The BetaShares Australian Quality ETF could be an ideal starting point for Aussie beginners because it focuses purely on quality.

Instead of chasing the largest shares in the index, this ASX ETF screens for businesses with strong profitability, low debt and stable earnings. These are traits of shares that tend to outperform over the long run.

Its portfolio includes some of Australia’s most resilient industry leaders such as Wesfarmers Ltd (ASX: WES), CSL Ltd (ASX: CSL) and ResMed Inc. (ASX: RMD). These are companies with hard-to-replicate competitive advantages and strong pricing power, which are qualities that help them ride out economic downturns far better than more speculative stocks.

For new investors who want exposure to high-quality Australian shares without having to analyse balance sheets and annual reports, this fund could be a very user-friendly way to begin building wealth. It was recently named as one to consider buying by analysts at Betashares.

BetaShares India Quality ETF (ASX: IIND)

For beginners wanting international diversification, the BetaShares India Quality ETF could be worth a shout. It offers a compelling long-term growth opportunity.

India is one of the world’s fastest-growing major economies, supported by a booming middle class, rising consumption, rapid digitisation, and ongoing economic reforms.

It holds leading Indian businesses such as Tata Consultancy Services (NSEI: TCS), Infosys (NYSE: INFY) and HDFC Bank (NYSE: HDB). These companies are deeply entrenched in sectors like technology, banking, software services and consumer spending, all of which are expanding quickly as India scales up.

It was also recommended by analysts at Betashares.

Betashares Nasdaq 100 ETF (ASX: NDQ)

Finally, if there’s one index that has delivered exceptional long-term returns, it is the Nasdaq 100 index. And the Betashares Nasdaq 100 ETF gives beginners direct access to it.

It holds some of the world’s most innovative and influential companies, including Apple (NASDAQ: AAPL), Microsoft (NASDAQ: MSFT), Nvidia (NASDAQ: NVDA), Amazon (NASDAQ: AMZN) and Alphabet (NASDAQ: GOOGL). These businesses sit at the centre of global megatrends like artificial intelligence, cloud computing, e-commerce and digital transformation.

Overall, for a beginner with a decade-plus time horizon, it could be a powerful engine of wealth creation.

The post 3 of the best ASX ETFs for beginners to buy with $1,000 appeared first on The Motley Fool Australia.

More reading

• The fundamentals behind quality investing according to experts
• 5 reasons to buy the Betashares Nasdaq 100 ETF
• No savings at 55? Here’s how to still retire with passive income
• 5 ASX ETFs to buy with $10,000 in December
• What $5,000 invested in ASX ETFs today could become in 10, 15, and 20 years

Motley Fool contributor James Mickleboro has positions in BetaShares Nasdaq 100 ETF, CSL, and ResMed. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Alphabet, Amazon, Apple, BetaShares Nasdaq 100 ETF, CSL, Microsoft, Nvidia, ResMed, and Wesfarmers. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has recommended HDFC Bank and has recommended the following options: long January 2026 $395 calls on Microsoft and short January 2026 $405 calls on Microsoft. The Motley Fool Australia has positions in and has recommended BetaShares Nasdaq 100 ETF and ResMed. The Motley Fool Australia has recommended Alphabet, Amazon, Apple, CSL, Microsoft, Nvidia, and Wesfarmers. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

Corporate Travel Management Ltd (ASX: CTD) shares have been out of action for over three months.

The corporate travel specialist’s shares haven’t traded since being suspended on 22 August.

And they will remain that way while auditors and investigators continue to work through significant historical accounting issues.

What has been announced?

This morning, Corporate Travel Management revealed the scale of the review and several immediate repercussions for the business.

According to the release, KPMG’s forensic team in the UK has spent months analysing approximately 47,000 documents and more than 1.5 million individual sales and purchase transaction lines, covering over GBP 400 million in transactions for its UK business.

The draft interim report delivered on 23 November identified two key issues:

• Incorrect revenue recognition relating to several large customer contracts completed between 2021 and 2023. These “Concluded Customer Contracts” account for GBP 45.4 million of revenue that should not have been recognised.
• Additional irregularities relating to other revenue earned by Corporate Travel Management (North).

The company now expects restatements across FY 2023 and FY 2024 of up to GBP58.2 million and further FY 2025 adjustments of up to GBP19.4 million. These are due in part to customer refunds and contracts where revenue can no longer be recognised with certainty.

Given the scale of the required corrections, the company has withdrawn its FY 2025 guidance, previously issued in May.

Immediate actions

The company outlined several steps now underway, including communicating with impacted customers, completing the forensic review with KPMG, restating prior years’ financial statements, and conducting a full external governance review.

The company’s board also confirmed that the CEO of CTM UK and Europe, Michael Healy, has been temporarily stood down with immediate effect. The company’s global COO, Eleanor Noonan, is stepping in as interim leader during the investigation.

Corporate Travel Management also disclosed that its FY 2025 accounts will include an additional $13.9 million in provisions related to the ANZ region. Though, these are separate from the UK issues.

Suspension to continue

The company says it remains well-capitalised, with A$148.3 million in cash and no drawn debt as at 31 October. However, it acknowledged that customer refunds could impact near-term liquidity, with timing and amounts still uncertain.

It has also secured an extension from ASIC to lodge its FY 2025 financial statements by 31 December. Though, it concedes that it is unlikely to meet that deadline. This could mean that we don’t see Corporate Travel Management shares return to the ASX boards before the end of the year.

Commenting on the news, the company’s chair, Ewen Crouch AM, said:

We recognise how serious this situation is and the concerns it has caused. We deeply regret and sincerely apologise for the impact of the trading suspension on our shareholders. We also extend our sincere apologies to the affected clients in the UK. While further investigation is required, including a comprehensive review of our UK operations and our overall governance framework, we remain fully committed to taking the necessary action to restore confidence.

Corporate Travel Management’s managing director, Jamie Pherous, added:

We recognise the impact this situation has had on our shareholders and affected UK clients, and we unreservedly apologise. Our priority is to uphold the highest standards across our operations, work closely with our auditors to finalise the FY25 financial statements, and implement all necessary measures to strengthen the company. While this work continues, we remain firmly focused on delivering quality service to our clients across all markets.

The post 3-month suspension: What’s going on with Corporate Travel shares? appeared first on The Motley Fool Australia.

More reading

• 5 things to watch on the ASX 200 on Thursday

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

ASX 200 tech shares have experienced a dramatic sell-off, with the S&P/ASX 200 Information Technology Index (ASX: XIJ) now 22% lower than its September peak.

The ASX 200 tech stock index hit a record 3,060.7 points on 19 September.

Today, it’s 2,387.1 points, down 22% in just 10 weeks.

By comparison, the S&P/ASX 200 Index (ASX: XJO) has fallen 1.7% over the same timeframe.

All 11 market sectors have fallen from their historical high points set this year, but technology is the worst performer of the bunch.

Wilsons Advisory equity strategist Greg Burke says domestic factors are mostly to blame for the dramatic fall in ASX 200 tech shares.

Burke says the tech sector has been oversold and opportunities abound.

What’s dragging ASX 200 tech shares down?

In an article, Burke discussed the domestic factors weighing ASX 200 tech shares down.

Firstly, he points to an unwinding in sector momentum, commenting:

… tech sector valuations had become demanding, peaking at ~100x forward earnings in August.

With tech stocks effectively ‘priced to perfection’, even modestly underwhelming updates from WiseTech Global Ltd (ASX: WTC), TechnologyOne Ltd (ASX: TNE) and Xero Ltd (ASX: XRO) have been enough to trigger a sharp rotation out of the sector, likely amplified by quant-flows.

On Friday, the WiseTech share price is $73.60, up 5.6% today and down 23.8% since the tech sector’s peak on 19 September.

The Xero share price is $123.29, up 0.1% today and down 24.2% since 19 September.

TechnologyOne shares are $30.41, up 1% today and down 20.7% since 19 September.

Secondly, Burke says a sell-off in Australian bonds has also weighed on ASX 200 tech shares.

… domestic government bond yields have risen ~40 bps since mid-October, and the AU–US 10-year spread has widened, driven by hotter-than-expected Australian CPI and solid labour market data.

This has weighed on the valuations of interest-rate-sensitive growth stocks on the ASX, particularly within the tech sector.

Another factor is significant mergers and acquisitions (M&A) activity by the tech sector’s two largest companies.

Xero completed its US$2.5bn purchase of Melio, while WiseTech closed its largest-ever acquisition – the US$2.1bn purchase of e2open.

Both deals have clear strategic merit, but carry integration risks, while they also face an ASX investor base that is generally sceptical of large offshore M&A.

In Xero’s case, the sizable capital raise appears to have contributed to material stock indigestion, with seemingly few incremental buyers for the stock post the raise.

The final domestic factor is investors’ concerns over governance at Wisetech.

… after a year of scrutiny, WiseTech faces an AFP–ASIC insider-trading investigation over blackout-period share sales by founder Richard White and other senior executives, with multiple former directors now being questioned.

The ongoing uncertainty has created a material overhang on the company’s share price, weighing on the broader sector.

Should you buy tech stocks?

Burke says the pullback in ASX 200 tech shares “appears to have created attractive buying opportunities”.

While past performance is not a reliable predictor of future returns, drawdowns of more than 10% have historically presented attractive buying opportunities in the tech sector for patient capital willing to look through near-term volatility. 

This has been particularly true when underlying company fundamentals remain solid and macro conditions – particularly long-term bond yields – are relatively stable.

Both conditions largely hold today: the ASX 200 IT sector still offers a three-year forward EPS CAGR of 24% (well above the 8% offered by the broader ASX 200), while a consensus ‘on-hold’ RBA view – alongside our expectation of range-bound to lower bond yields – suggests tech valuations are unlikely to face additional material macro headwinds.

Wilsons Advisory’s preferred large-cap ASX 200 tech shares are TechnologyOne and Xero. 

The post What’s driving the dramatic drop in ASX 200 tech shares? appeared first on The Motley Fool Australia.

More reading

• Why HMC Capital, Select Harvests, Web Travel, and WiseTech shares are pushing higher today
• 4 ASX 200 large-cap shares with new ratings from Morgans
• 3 ASX stocks I’d trust with $10,000 for the next decade
• The Warren Buffett golden rule that investors can’t ignore
• These top ASX 200 stocks could rise 25% to 60%

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 positions in and has recommended Technology One, WiseTech Global, and Xero. The Motley Fool Australia has positions in and has recommended WiseTech Global and Xero. 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.