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Codan vs Megaport shares: two ASX techs full of surprises
Everyday investors are always on the lookout for Aussie tech names with serious growth potential, and right now, Codan Ltd (ASX: CDA) and Megaport Ltd (ASX: MP1) are two of the most talked-about options. Both operate at the leading edge of technology but take quite different approaches, serving a wide range of customers and end markets. Here's a breakdown of Codan vs Megaport shares and what I make of their prospects.
The case for Codan
Codan Ltd is an Australian technology powerhouse that designs and manufactures electronic solutions for government, defence, mining, and consumer markets worldwide. With businesses spanning communication systems, metal detection, and mining tech (including Codan Communications, Minelab, Minetec, and Defence Electronics), Codan's reach is truly global. It manages its own product design and has manufacturing facilities not just in Adelaide but also in Malaysia — as well as sales or support offices across North America, Europe, and the Middle East. According to its company profile, most of its revenue actually comes from North America.
A few standout fundamentals:
- Codan's market cap is a hefty $9.53 billion, which puts it in the ASX tech heavyweight ranks.
- Its shares are up a thumping 85.5% year-to-date, showing the kind of momentum most investors dream about.
- The company's dividend history shows a steady (and fully franked) stream of payouts, with a current yield of 0.93% and 100% franking on recent payments — appealing for those wanting some income.
- Codan's P/E is 54.48, and it reported earnings per share of 0.959. While high, this sort of multiple appears more common among well-loved tech names with rapid growth expectations.
The case for Megaport
Megaport is a star of Australia's next-gen tech scene, providing a network-as-a-service (NaaS) and cloud connectivity platform. Its software allows customers around the globe to instantly connect across more than 1,100 data centres in over 30 countries, linking directly to the likes of Amazon Web Services, Microsoft Azure, and Google Cloud Platform. In late 2025, Megaport announced a significant expansion into AI compute infrastructure via its acquisition of Latitude.sh, bringing on-demand GPU cloud services under its belt. Its business covers the Americas, Asia-Pacific, EMEA, and now a growing Compute division that pushes into the frontier of AI infrastructure.
Megaport's key stats in this snapshot:
- A market cap of $4.67 billion makes it a tech mid-cap by ASX standards.
- Year-to-date, Megaport shares have surged 66.9% — a stellar run, even if not quite as meteoric as Codan this year.
- Megaport does not currently pay dividends and its dividend yield is 0.00%, suggesting it's ploughing all cash into growth.
- Its P/E ratio is an eye-watering 370.00, and its reported EPS is -0.218. (Note: Megaport's reported P/E ratio may be based on a different earnings measure, such as underlying or forward EPS, than the figure shown here, which is why these numbers might look inconsistent.)
Valuation comparison
The numbers underline just how differently the market views these two tech players:
| Metric | Codan | Megaport |
|---|---|---|
| Market Cap | $9.53 billion | $4.67 billion |
| P/E Ratio | 54.48 | 370.00 |
| Dividend Yield | 0.93% (100% franked) | 0.00% |
| Earnings Per Share | 0.959 | -0.218 |
| YTD Return | 85.5% | 66.9% |
Codan's P/E ratio is high, but compared to Megaport's eyewatering 370, it appears much more grounded. It's also delivering consistent profits and dividends, unlike Megaport, which is still reporting negative earnings per share. The huge difference in dividend yield — with Codan offering fully franked dividends and Megaport offering none — might sway investors who prefer some cash returns.
Recent share price performance
Comparing both companies' share price movements as of 25 September 2026:
- Codan Ltd closed at $52.25, down 0.97% for the day, after a remarkable year powered by an 85.5% year-to-date return.
- Megaport Ltd closed at $19.62, flat for the day, and has delivered a 66.9% year-to-date return.
Both companies have been on strong upward trends, but Codan enjoyed more pronounced positive momentum recently.
Which is the better buy?
So, which one has more upside? For my money, I think Codan gets the edge right now. Both companies have delivered cracking returns in 2026, but Codan's profits, global reach, and verified track record of paying (and growing) fully franked dividends make it stand out. While Megaport is exciting and at the forefront of cloud and AI, the P/E multiple is extremely stretched, especially considering it's still loss-making on a reported basis.
That's not to say Megaport isn't a great business — it is, and its expansion into AI compute could pay off over time. But if I'm choosing today between Codan and Megaport, I'd lean toward Codan as the tech stock with more upside, given the sharp run in earnings, dividends, and a valuation that's elevated but not as extreme as Megaport's.
