The S&P/ASX 200 Index (ASX: XJO) closed 0.1% lower on Wednesday after a subdued hump-day session, with declines seen across many markets. Over the past year, the index has climbed 9.43% higher.
But if you have some spare cash burning a hole in your back pocket, the muted mid-week index performance could present a great buying opportunity for high-quality stocks.
If you have a spare $5,000, here's a great ASX 200 stock to place your money in.
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Top Aussie stock to buy today
Much like the rest of the ASX 200 Index, the Xero Ltd (ASX: XRO) share price dropped 1.7% and closed at $154.79 per share on Wednesday.
In fact, the cloud-based technology company's shares have been through the ringer recently, experiencing strong peaks and dramatic falls.
The share price spiked to an all-time high of $19.21 in June, but has since crashed by 20.25%.
What happened to the ASX 200 stock?
Xero posted lower-than-expected FY25 results in May and revealed a 23% (20% in constant currency) increase in operating revenue to NZ$2.1 billion.
Soon after, in July, the ASX 200 tech share announced the acquisition of US-based Melio, a small to medium business bill pay platform.
The deal came with a huge US$2.5 billion price tag, and the company successfully raised A$1.85 billion via capital raising with institutions and retail investors. But investors were spooked about the deal size and projected cash flow.
The investor sell-off sparked the 20% drop in its share price between the deal's announcement and today's trading price.
What next for Xero shares?
The thing is, Xero is one of the leading technology companies on the ASX because it offers easy-to-use accounting software to business owners, accountants, and financial advisors.
The software is referred to as "sticky", which means it has a very low subscriber churn rate. This means it has potential for strong and continued growth in what has become a large and constantly developing market.
Analysts are confident that Xero's current share price presents a good buying opportunity for investors seeking to invest in high-quality shares.
According to TradingView data, 5 out of 8 analysts hold a buy or strong buy rating on the stock. The average target price for the shares over the next 12 months is $204.97, and the maximum is $250.88. That represents a potential upside of 32.4% to 62.1% for investors.
Analysts at Citi are one of the brokers with a buy rating and $210 target price on the shares. According to its analysts, Xero has "superior subscriber growth" and has offerings that could deliver key growth in the future.
UBS is one of the brokers that like the company. It currently has a price target of $215 on Xero.
