The analyst team at UBS has been hard at work this week analysing the deluge of profit reports which have come out, and have issued a number of buy recommendations on companies.

I've selected three of those which UBS believes will perform particularly well from a share price perspective, which I'll run through now.

Let's have a look.

Zip Co Ltd (ASX: ZIP)

Zip on Thursday announced record cash EBTDA of $268.9 million, up 57.9% on the previous year.

The buy now, pay later provider said total transaction volume (TTV) grew to $16.7 billion, up 27.2%, while the number of merchants on its platforms increased 13.8%.  

On the outlook, Chief Executive Officer Cynthia Scott said the company was targeting cash earnings of $340 million in FY27, which would be a 26% increase.

UBS said in a note to clients that the outlook for the current year was better than expected, providing comfort around the defensive qualities of the buy now, pay later business model through slowing economic times.

UBS said:

Whilst macro remains key uncertainty into FY27, we have increased confidence around Zip's defensive quality and ability to drive customer growth and transaction frequency. Our US TTV growth forecast of +30% in FY27 is comprised of 9% customer growth and 19% TTV/customer growth, which we view achievable.

UBS has a price target on ZIP shares of $4.70 compared to $2.76 currently.

Megaport Ltd (ASX: MP1)

This cloud computing company this week announced FY26 revenue of $312.2 million, up 37%, while EBITDA was up 24% to $77.1 million.

Megaport Chief Executive Officer Michael Reid said:

Our team delivered an exceptional result in FY26. The Network business produced its strongest commercial performance to date, Latitude.sh expanded rapidly following acquisition, and our combined capabilities secured major long-term customer contracts across Compute, Network, and Storage. We have materially increased the scale of the business, broadened the markets we can serve, and created a much larger opportunity. Now our job is to execute against it.

UBS said the net outcome of the results report was "firmly in the positive", and they are estimating EBITDA of $624 million for Megaport in FY28.

The broker has a price target of $26.40 on Megaport shares, up from $24.20, compared to the current share price of $18.60.

MA Financial Group Ltd (ASX: MAF)

UBS said MA Financial Group delivered an in-line FY26 result, "though we think the share price reaction (+18%) reflects material potential for upside towards new FY29 targets, and a stronger 2H outlook''.

UBS has a price target on MA Financial Group of $10.10 compared to $7.07 currently.

The post 3 ASX shares UBS says will return better than 36% appeared first on The Motley Fool Australia.

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• Brokers name the ASX 200 winners and losers from the first half of reporting season
• Why Megaport, Lendlease and JB Hi-Fi shares all crashed 14% to 15% this week
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• Buy, hold, sell: Fortescue, Northern Star, and Megaport shares

Motley Fool contributor Cameron England has positions in Megaport. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Megaport. The Motley Fool Australia has recommended Ma Financial Group. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

Global Lithium Resources Ltd (ASX: GL1) shares have jumped substantially in recent weeks, as the company has secured key approvals for its Manna lithium project in Western Australia.

The shares are up slightly more than 200% over the past 12 months, but the analyst team at Shaw and Partners believe the share price has a long way to go yet.

They've got a buy rating on the shares, and a very bullish share price target, which I'll get to shortly.

First, let's look at the company's recent announcements.

Approvals coming thick and fast

Firstly, in early August, GL1 announced that it had received approval for the Mining Development and Closure Proposal (MDCP).

The company said at the time:

The approved MDCP enables the establishment of important early works and critical infrastructure at the Manna mine site, directly supporting the integrated Manna-Nova strategy. The proposed Manna mine, located 110km east of Kalgoorlie-Boulder, is planned to operate for at least 14 years. The Project's MDCP approval contemplates the development of multiple open pits, comprising one main (Manna Main) and two satellites (Manna North and Manna South), waste rock and dry stack tailings, ore stockpiles, accommodation village, bore field, topsoil stockpile areas and associated mining infrastructure.

The company said the approval would also give more confidence to a final investment decision for the mine, which is targeted for the fourth quarter of 2026, with the first direct shipping ore then targeted for the second quarter of 2027.

Then on 20 August, GL1 announced it had received the Native Vegetation Clearing Permit for the mine, completing the primary state approvals needed to begin early works. The company's groundwater licence was also approved.

GL1 Managing Director Dr Dianmin Chen said:

Three major approvals in a fortnight is a credit to the professionalism of DMPE and DWER and to the depth of our own team's technical work. Manna is now cleared on the ground, cleared to take water, and ready to move into construction. These approvals pave the way for starting early works and then mining operations at Manna, which will generate jobs, boost economic activity in the region, and benefit all stakeholders including our local communities for many years to come.

Global Lithium Resources shares looking cheap

Shaw and Partners said GL1 had substantially derisked the Manna project by securing the approvals.

The broker added:

Instead of committing to a standard greenfield build, GL1 management's capital-light approach has successfully preserved Manna's cash and strategic optionality. This positions Manna to capture the near-term market window, where lithium prices are expected to benefit from sustained supply deficits and growing demand over the next three years.

Shaw and Partners has a price target of $1.75 on GL1 shares, compared to 67.5 cents currently.

The post Up more than 200% over a year, could this ASX lithium company double again? appeared first on The Motley Fool Australia.

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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.

Shares in Zip Co Ltd (ASX: ZIP) surged more than 18% on Thursday after the company reported its full-year results, begging the question, are the shares now fully priced?

While the shares jumped significantly on Thursday, they are 9.3% lower over a 12-month period after pulling back 7.2% on Friday morning to $2.83.

The analysts at Macquarie have had a look at the results and have come up with an outperform rating on the stock, and a bullish share price target which I'll get to shortly.

The team at UBS are also bullish on the company.

Before we get to what the analysts are saying, let's look at what Zip announced this week.

Large jump in earnings underpinned Zip share price surge

The buy now, pay later service provider on Thursday announced record cash EBTDA of $268.9 million, up 57.9% on the previous year.

Total transaction volume (TTV) grew to $16.7 billion, up 27.2%, while the number of merchants on Zip's platforms increased 13.8%.

Zip Chief Executive Officer, Cynthia Scott, said regarding the result:

Consistent execution has built the platform to deliver our next phase of growth and innovation. In FY26, we exceeded our targets with record cash earnings of $268.9m, up 57.9%, underpinned by material cash earnings growth in both markets. We maintained strong unit economics, expanded operating leverage and reinforced the value of our differentiated business model. Our focus on exceptional customer experiences is translating into stronger engagement. In the US, we achieved more than 40% growth in both TTV and revenue for a second consecutive year while adding new customers at scale. In ANZ, we returned to revenue and Australian receivables growth, led by the continued success of our Zip Plus product.

Ms Scott said Zip was targeting cash earnings of $340 million in FY27, which would be a 26% increase.

Brokers like the look of Zip shares

UBS said in its note to clients that the outlook for the current year was better than expected, providing comfort around the defensive qualities of the buy now, pay later business model through slowing economic times.

UBS said:

Whilst macro remains key uncertainty into FY27, we have increased confidence around Zip's defensive quality and ability to drive customer growth and transaction frequency. Our US TTV growth forecast of +30% in FY27 is comprised of 9% customer growth and 19% TTV/customer growth, which we view achievable.

UBS has a price target on ZIP shares of $4.70.

Macquarie said "Zip's outlook remains attractive as management executes the market opportunity in the US, supported by performance in AU''.

Macquarie has a price target of $3.50 on Zip shares.

Zip is valued at $3.8 billion.

The post How high do UBS and Macquarie think Zip shares will go? appeared first on The Motley Fool Australia.

More reading

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• 3 ASX shares UBS says will return better than 36%
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• Buy, sell, hold: Dexus, APA, Zip shares

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

Shares in Universal Store Holdings Ltd (ASX: UNI) are being flagged as a buy by brokers, and one is tipping that the already healthy dividend will continue to increase in the coming years.

Solid profit result underpins strong dividend flows

The youth wear retailer on Thursday reported full-year sales of $376.1 million, up 12.9% on the previous year, and an underlying net profit of $40.5 million, up 16.3%.

A fully-franked final dividend of 17 cents per share was declared, bringing the full-year dividend payout to 43 cents per share, for a dividend yield of 5.3%.

Group Chief Executive Officer Alice Barbery said regarding the result:

The team delivered another strong full year result, with robust sales and gross margin growth. This performance reflects the continued excellence in providing our customers with on-trend products, a service-oriented experience and engaging communications. The Group is well positioned heading into FY27. Our observation is that our customer remains willing to spend on quality, on-trend clothing from brands they love. As always, we continue to focus on cost discipline as we invest in our team and system capability to support future growth.

Within the Universal Store stores, the company's private brands accounted for 51% of sales, while "a strong assortment of third-party brands continues to be a key element of presenting customers with an on-trend offering''.

So far in FY27, total sales are up 9.1% on the same period last year.

Universal Store said it intends to open 16 to 20 stores during the year, comprising nine to 10 Universal Store stores, six to eight Perfect Stranger stores, and one to two Thrills stores.

Brokers say Universal Store shares are looking cheap

UBS said the company's earnings were higher than consensus estimates and at the top end of guidance.

They said like-for-like sales so far this year were "pleasing in Universal Store and very strong in Perfect Stranger given the tough previous corresponding period''.

UBS has a price target of $9 on Universal Store shares compared to $8.07 at the time of writing.

The broker is also forecasting that the dividend yield will increase each year out to FY30, when it will be 8.7%.

RBC Capital Markets said Universal's result was good, "with clean beats on all metrics''.

The broker added that the company's gross margin outlook looks good and the balance sheet is strong.

They added:

We have no concern over management flexibility to fund the FY27 store rollout.

RBC has a price target of $9.50 on Universal Store.

Universal Store is valued at $540.9 million.

The post This retailer's dividend yield could top 8% in coming years: Broker appeared first on The Motley Fool Australia.

More reading

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• I'd buy 11,295 shares of this ASX stock to aim for $400 a month of passive income

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

When it comes to superannuation, it pays to have a target in mind when you're putting money away for the future.

As the old adage says, failing to plan is planning to fail.

The good news is that even if you start relatively late, there are strategies you can use to boost your super to a level where it will afford you a comfortable retirement.

How much superannuation do you need for $1500 per week in passive income?

Today we're looking at the scenario where you are aiming to generate $1500 per week in passive income from your superannuation.

So to start with, is this considered a comfortable retirement? The short answer is yes.

The Association of Superannuation Funds of Australia has calculated how much is needed for singles and couples to have a comfortable retirement, and the figures come out at $55,923 for singles and $78,566 per year for couples.

These figures assume you own your own home and will draw a part pension, but they are well under the $1500 per week, or $78,000 per year level we are looking at.

So, how much superannuation would you need to generate this amount?

Let's assume you can generate a 10% return on your investments. In this case, you'd need a $780,000 superannuation balance.

If you were generating just 5% you would need a balance of $1.56 million.

I'd argue that somewhere in the middle is achievable over time. So if you were generating a 7.5% return, you'd need a balance of $1.04 million.

What shares might help you achieve your passive income goal?

In terms of the shares you might want to have in your portfolio, you could look at listed investment trusts such as Charter Hall Retail REIT (ASX: CQR), which brokers expect to pay a return of better than 6% through to 2030, or Dexus Industria REIT (ASX: DXI), which is currently paying a healthy 6.97% yield.

Alternatively, financial services company Regal Partners Ltd (ASX: RPL) is paying a fully franked 7.42%.

Among the Wilson Asset Management funds, WAM Strategic Value Ltd (ASX: WAR) is paying a yield of 5.65%, while WAM Active Ltd (ASX: WAA), recently increased its dividend and is paying out 6.94%.

Among the banks, Westpac Banking Corp (ASX: WBC) is paying 4.35% fully franked, while Bank of Queensland Ltd (ASX: BOQ) is paying 6.19% also fully franked.

Among Australian blue-chip stocks, Telstra Ltd (ASX: TLS) is paying 4.39%, and miner BHP Group Ltd (ASX: BHP) is paying 3.19%.

How to increase your superannuation balance

If you're keen to increase your superannuation balance, investigate the viability of making extra concessional contributions up to the $32,500 cap, with these contributions taxed at just 15%.

The $32,500 cap includes any contributions from your employer and amounts contributed through salary sacrifice.

If your superannuation balance was under $500,000 in the last financial year, you can also carry forward up to five years' worth of unused concessional contribution amounts. You can find out how much you can contribute under this rule by logging in to your myGov account.

Non-concessional contributions of up to a further $130,000 can be made each year also.

The post How much is needed in superannuation for $1500 in weekly passive income? appeared first on The Motley Fool Australia.

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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 positions in and has recommended Charter Hall Retail REIT and Telstra Group. The Motley Fool Australia has recommended BHP Group. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

It's easy to get overwhelmed with the sheer number of profit reports coming out around this time of year.

In this situation, it pays to check in with the experts and see which results have piqued their interest.

I've selected three reports from UBS analysts who have rated these companies a buy.

Let's see who they like.

Superloop Ltd (ASX: SLC)

UBS said Superloop's EBITDA of $123 million for the full year came in ahead of guidance, which was a positive.

The broker said "there is a lot to like here", including good margins on the business and wholesale front, momentum in adding new consumer customers, and disciplined cost management.

They added:

We think these will feature yet again in FY27 and beyond and establish a solid foundation for SLC to deliver on its Supercharge29 ambitions. We forecast progressive margin improvement for both Business and Wholesale, and expect EBITDA margins to exceed 20% by FY29.

UBS said the company also reported good momentum for the first six weeks of FY27, which was not surprising "given SLC's extensive marketing efforts to increase brand awareness, network quality and relatively attractive pricing''.

UBS has a price target of $4.15 on Superloop shares compared to $3.08 currently.

Service Stream Ltd (ASX: SSM)

UBS said this company also delivered a full-year result that was better than expected, with good margins contributing.

The broker noted that Service Stream continues to see 5% to 10% year-on-year earnings growth as sustainable.

They also suggested the company could be active in the M&A space, saying:

With $81mn net cash and strong track record of cash generation, we think SSM is well placed to supplement its organic growth profile. SSM has successfully integrated Lendlease Services and has exceeded expectations when it comes to mobilisation and ramp up of Defence work. These experiences should bode well especially when it comes to M&A opportunities, in our view. Focus is likely to be on Power and Industrial, but we think SSM is likely to consider opportunities to diversify its capabilities and capacity beyond these areas.

UBS has a price target of $2.95 on Service Stream compared to $2.51 currently.

Breville Group Ltd (ASX: BRG)

This company also beat FY26 consensus estimates on a number of fronts, and while revenue growth was lower than expected, margins were better.

UBS said the company remained attractive as it had a long-term track record of double-digit EBIT growth.

The broker has a $37 price target on Breville shares compared to $31.26 currently.

The post 3 ASX stocks UBS rates as a buy after recent results appeared first on The Motley Fool Australia.

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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.

Wam Microcap Ltd (ASX: WMI) is paying a dividend yield of 7.6%, or 10.9% including franking credits, despite reporting an operating loss for the full year.

The fund's investment portfolio also underperformed, increasing just 0.1% for the year, while its benchmark, the S&P/ASX Small Ordinaries Accumulation Index, rose 8.1%.

Could do better, fund manager says

WAM Microcap Lead Portfolio Manager Oscar Oberg said regarding the result:

Following eight consecutive years of outperformance since listing, FY2026 was a challenging year for the WAM Microcap investment portfolio. The underperformance relative to the benchmark was primarily driven by our limited exposure to resources companies during a period of exceptionally strong performance from the sector, combined with stock selection that was not at the level we expect. The strongest headwind for the portfolio was the significant divergence between resources and industrial companies. While this positioning detracted from investment portfolio performance in FY2026, we believe our focus on identifying undervalued micro-cap industrial companies will continue to create opportunities for shareholders over the long term.

Mr Oberg said the managers believed the fund was well-positioned at the start of the financial year, and they remain confident in the opportunities in the microcap sector.

Since inception, WAM Microcap has increased 14.4% per annum, outperforming the S&P/ASX Small Ordinaries Accumulation Index by 7.4% per annum.

Dividend yield still looking healthy

Wam Microcap will pay its fully-franked dividend of 5.35 cents on October 29 to shareholders on the register on October 16.

The dividend is up slightly from 5.3 cents for the same period last year.

Some of the fund's largest holdings include EDU Holdings Ltd (ASX: EDU), Artrya Ltd (ASX: AYA), and Echo IQ Ltd (ASX: EIQ).

The fund focuses on companies with a market capitalisation of less than $300 million at the time of acquisition.

Other Wilson funds also paying good dividend yields

The fund's dividend yield is better than others in the Wilson Asset Management Stable, with WAM Strategic Value Ltd (ASX: WAR), WAM Active Ltd (ASX: WAA), and WAM Income Maximiser Ltd (ASX: WMX) all paying solid dividends, yet not up to that level.

WAM Strategic Value reported earlier this month that it would pay an increased, fully-franked dividend of 6.5 cents per share, up 8.3% on the previous year and representing a yield of 5.9%.

This increases to 8.4% once franking credits are factored in.

WAM Active is paying the same return as WAM Strategic Value; however, if you include capital gains, it returned 40.2% for the year to the end of June.

The post This fund just declared a dividend yield of better than 7% appeared first on The Motley Fool Australia.

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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.

Hansen Technologies Ltd (ASX: HSN) shares are slightly more than 40% down over the past 12 months, but following their full-year results, broker Shaw and Partners is predicting some serious upside for the S&P/ASX 300 Index (ASX: XKO) stock.

Shaw and Partners has a buy recommendation on the shares, and a very bullish share price target, which I'll get to shortly.

First, let's look at what the company reported recently.

Strong profit result from steady revenue

Hansen earlier this week reported operating revenue of $386.5 million, down 1.5%, with the company saying the result was impacted by lower licence fees and foreign exchange headwinds.

Underlying net profit was strong however, coming in 22.5% higher than the previous corresponding period at $48.5 million.

Hansen Chief Executive Officer Andrew Hansen said regarding the result:

FY26 demonstrated the resilience of Hansen's business model. In a more cautious environment, we have remained focused on disciplined execution, protecting earnings quality while continuing to invest for long-term growth. What we have seen during the year, with regards to revenue, is primarily caused by mix and foreign exchange. We continue to have a solid pipeline of demand for our products and services. Our recurring revenue base continues to improve, providing stability and visibility through the cycle. AI is increasingly driving productivity, operating leverage and long-term margin expansion.

The company said AI had been a large focus, and an AI enablement team had been set up to drive capability across the workforce.

Hansen said it was now "shifting from capability building to the deployment and commercialisation of AI solutions that deliver measurable value for customers and shareholders''.

On the corporate front, the company said its strong cash generation and conservative balance sheet provided flexibility to pursue accretive opportunities.

Hansen Technologies shares looking cheap

Shaw and Partners said in a note to clients following the result, that it was a better result than the headline numbers indicated.

They said:

Key takes: 1) FY26 was stronger underneath the headline, with improving recurring revenue mix, disciplined costs and record cash generation; 2) FY27 is now a transition/investment year as licence revenue shifts to recurring streams and HSN reinvests in AI and sales, with growth and 30%+ margins expected to return in FY28; and 3) Stuart MacDonald's appointment as CEO adds a credible new growth lens.

Shaw and Partners reiterated their buy rating but reduced their 12-month price target on Hansen shares from $7.60 to $6.80.

This compares to $3.26 currently. Hansen Technologies is valued at $869.2 million.

The post This ASX 300 technology stock is tipped to double in the next 12 months appeared first on The Motley Fool Australia.

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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.

Santos Ltd (ASX: STO) this week reported what broker UBS described as a "strong" first-half result, beating market expectations in a period the company is describing as a transition year.

Profit down but stronger second half expected

The oil and gas major reported first-half revenue of US$2620 million, up 2% on the same period the previous year, and net profit of US$355 million, down 19%.

Santos Managing Director Kevin Gallagher said the company was entering the second half in a stronger position.

He added:

The first half marked an important step forward for Santos. We brought the Pikka project online safely and continued to progress Barossa through commissioning towards steady-state production, while the base business continued to perform strongly. Pikka achieved first oil in May, moved to continuous production in June and we lifted our first crude oil cargo last week. Production is expected to build towards the 80,000 bbl/d gross plateau late in the third quarter, and our drilling program is consistently beating technical limits, reducing the time and cost to drill a well. Barossa is safely progressing through commissioning to steady state production, with current production around 550 mmscf/d and planned to increase further to around 600 mmscf/d by end of the quarter. At steady state production the current cargo cadence is one approximately every eight days, while Darwin LNG delivered 100 per cent plant reliability in the first half.

Mr Gallagher said with the major development of Barossa and Pikka complete, the company was expecting second-half production to be 20% to 30% higher than the first half, "supporting stronger free cash flow and returns for shareholders''.

Mr Gallagher said the Papua LNG project would be a focus in the second half and was on track for a final investment decision in the fourth quarter of 2026.

He added:

Project financing continues to progress well, with at least 60 per cent targeted to be funded through project financing facilities. Strong performance from the base business and continued capital discipline are funding investment in the next generation of low-cost, high-margin production growth opportunities in our deep portfolio.

Santos shares a buy, but looking fully valued

UBS said in a note to clients following Santos' financial report that the company's strong dividend of US11.6 cents stood out, indicating the board had confidence in the second-half outlook.

They said the company was well-leveraged to higher oil prices.

They added:

STO has 80% of its LNG sales indexed to oil and/or Japan/Korea Marker on an approx 3 month lag, and so the spike in oil & LNG prices arising from the Middle East conflict carries stronger cashflows though to at least ~Nov-26. We expect STO will qualify for its new higher div payout (lifting from 40% of FCF ex growth to >60% of all-in FCF) when Pikka and Barossa reach plateau production, expected within the next 40 days turning on stronger cash returns from the Feb-27 result onwards.

UBS has a buy rating on Santos shares with a price target of $8.30, compared to $8.31 currently.

The post Are Santos shares a buy following their half-year results? appeared first on The Motley Fool Australia.

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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.

The goal for most of us is to save enough in our superannuation such that we can fund a relatively comfortable retirement.

Whether that occurs at age 60, when we can access our superannuation, or later depends on various factors, but the amount of superannuation is, of course, important.

This begs the question: how much do you need to fund your retirement?

Australian superannuation amounts coming up short

It's instructive to look at the statistics on how much superannuation Australians currently have.

At the moment, for men aged 60-64 the average amount is $395,852, while for women the amount comes in at $313,360.

For those aged 65-69 the numbers come in at $448,518 and $392, 274, with all of these figures calculated by the Association of Superannuation Funds of Australia (ASFA).

Meanwhile, ASFA has calculated that to have a comfortable retirement, using superannuation and a part pension, and assuming you own your own home, couples will need $730,000 in super while singles will need $630,000.

How much passive income will superannuation generate?

Now let's look at what those aged 60-64 could expect to earn from their superannuation in passive income.

If a retiree had $395,852 in superannuation and earned 10% on their investments (a lofty sum to assume on a yearly basis), they would earn $39,585. This is well below the $55,923 per year which ASFA says would afford a comfortable retirement.

If they earned just 5%, this figure would drop to $19,792.

What this tells us is that many people do not have enough in their superannuation to sole-fund their lifestyle.

So, what can you do to prepare if you think your superannuation needs a top-up?

Strategies to boost your superannuation balance

Extra contributions can be made to superannuation in the form of concessional and non-concessional contributions.

Concessional contributions are taxed at just 15% and include money contributed by your employer, salary sacrifice contributions, and extra contributions you make up to a cap of $32,500.

If funds permit, and your superannuation balance was less than $500,000 in the last financial year, you can also carry forward any unused concessional contribution cap amounts from the previous five financial years.

The amount you are able to contribute in this way can be found in your myGov account.

A notice of intent to claim must be lodged with your super fund for concessional contributions so they know to deduct the 15% tax from the amount.

It is also possible to make non-concessional contributions up to an amount of $130,000, and it is also possible to contribute more than this amount using the bring forward rule.  

The post Does the average superannuation balance at 60 generate enough passive income? appeared first on The Motley Fool Australia.

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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.

ASX gold stock Astral Resources Ltd (ASX: AAR) has had a big week for news at its Mandilla gold project in Western Australia, and according to the analysts at Shaw and Partners the company is one to watch.

They have a buy recommendation on the stock, albeit with a high-risk warning, and a bullish share price target, which I'll get to shortly.

First let's look at what the company has announced.

Solid drilling results from WA gold prject

Earlier this week, Astral released the latest drilling from the Theia deposit at the Mandilla project, saying further broad zones of mineralisation had been intersected.

The best results included 52.7m at 4.67 grams per tonne of gold from a depth of 445m, and 21m at 1.61 grams per tonne from 321m.

To date 13 holes of a total of 21 have been drilled.

Commenting on the result, Astral Resources Managing Director Marc Ducler said:

The Theia Deeps drill program, which has now been extended to 21 holes for 11,000m, continues to show tremendous potential for additional growth at Theia, with the program targeting further high-grade extensions to the Theia resource at depth and along strike. These latest assay results … have all demonstrated broad zones of high-grade gold mineralisation beyond the base of the current April 2026 Mineral Resource shell. These programs position Astral for a very active second half of 2026 as we continue to both de-risk and grow the Theia deposit, advance the Mandilla Project definitive feasibility study (DFS) and kick-off a series of very promising exploration programs to test for growth opportunities at Kamperman and across our highly prospective Spargoville tenure.

In addition to the new exploration results, Astral announced it had struck a land-use agreement with the Marlinyu Ghoorlie Native Title Claimant Group for the project.

The company said the agreement covers protocols for heritage surveys, activities to protect identified sites and clearance procedures to facilitate mining activities at the Mandilla project.

This ASX gold company's shares are looking cheap

Shaw and Partners said the land use agreement was an important hurdle for the company.

They also said they saw good prospects for a mineral resource upgrade from the company either accompanying or following the DFS.

They added:

We maintain Buy rating on Astral Resources and $0.30 price target. The combination of continued high-grade extensional drilling at Theia and the completion of native title agreements across the Mandilla DFS tenement package both support the de-risking thesis into DFS completion in MarQ'27. Next key catalysts include further Theia Deeps assays, the Spargoville and Kamperman follow-up drilling in SepQ, and delivery of the Mandilla DFS itself.

Astral shares are currently changing hands for 18.5 cents. The company is valued at $297.2 million.

The post This ASX gold stock could jump in value by 60%: Broker appeared first on The Motley Fool Australia.

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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.

CSL Ltd (ASX: CSL) shares have staged an impressive recovery over the past three months, aided by a sharp jump this week following the company's full-year results announcement.

The shares are still more than 25% down over a 12-month period however, begging the question, is there still more recovery to come?

It's fair to say brokers are split on the question, with those surveyed having a wide range of views on where the shares will go over the next 12 months.

First let's have a quick look at what CSL announced this week.

Steady results in reset year

The blood products company posted total revenue of US$15.8 billion, down 1%, and underlying net profit of US$3.1 billion, down 2%.

After significant one off costs and write downs were included, the company made a net loss of US$2.6 billion.

Interim Chief Executive Officer Gordon Naylor called FY26 a "reset" year for the company.

On the outlook, the company said it expected underlying net profit to grow by about 5% in FY27.

Wide range of views on CSL Shares

Among the brokers, UBS has the most bullish share price target for CSL at $181, compared to $163.51 late on Wednesday.

The broker said:

CSL has endured a challenging period that required significant restructuring to reduce costs and address the underperforming Vifor division. While more work remains, improving trends in the core plasma business suggest the worst is behind the group and that CSL is on track to return to at least market level growth. The separation of Seqirus is now complete, providing the incoming CEO with additional strategic flexibility.

Morgan Stanley also believes the price will appreciate, with a $172 price target.

They said:

On balance, we see the FY26 result and FY27 guidance as highlighting incremental improvement within CSL Behring, the key driver of group earnings growth over the medium to longer term. Our forecasts imply solid underlying NPATA/NPAT growth, supplemented by an ongoing buyback program.

Meanwhile, Bell Potter has a hold recommendation on CSL, with a price target of $150.

They said:

While the result today suggests the worst (by way of earnings declines) is in the rear-view for CSL, we find it difficult to justify a greater premium than is now being attributed relative to global biopharma peers.

And most bearish on CSL is Macquarie, which has a neutral rating and a price target of just $133.

They said:

Despite signs of stabilisation, we see ongoing uncertainty across core business segments (immunoglobulin, albumin) and medium-term competitive risks.

The post How much are CSL shares worth? 4 brokers have their say appeared first on The Motley Fool Australia.

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

Shares in Amplitude Energy Ltd (ASX: AEL) have fallen more than 40% over the past 12 months, but if the analysts at Macquarie are to be believed, they are in line for a re-rating.

The broker has published a new research note on the gas producer with a bullish share price target which I'll get to shortly.

First, let's have a look at Amplitude's recent full-year results release.

Solid operating results from Amplitude

The Otway Basin-focussed company delivered record full-year production of 27.6 petajoules of gas, up 3% on the previous year.

Revenue meanwhile was up 7% to $285.8 million, and underlying earnings were a record $191.8 million, up 12%.  

Managing Director Jane Norman said the company was delivering on its strategy.

She added:

Amplitude Energy has delivered record financial results for the third consecutive year, underpinned by solid operational performance and continued cash flow improvement through FY26. The business remains resilient in the face of external challenges. With strong base business cash flows providing funding for our growth projects, the Company is well placed to maximise its long-term value. Record production performance was driven by Orbost, where production was increased above the plant's previous 68 TJ/day nameplate level. Orbost has since demonstrated an ability to operate well above 70 TJ/day, recently setting a series of new production records.

Ms Norman said the company was on track to achieve "transformational growth through the East Coast Supply Project, one of the most significant sources of new domestic gas supply currently being advanced in south-east Australia''.

She added:

Our acquisition of the discovered Artisan gas field, combined with our existing Annie discovery, provides the basis for a very attractive project, with further potential near-term exploration upside from Juliet drilling. The Artisan transaction is a good example of cooperation between Otway Basin participants leading to project synergies, and was made possible in part by our strong relationship with O.G. Energy.

Amplitude is forecasting production of 26.6-28.5 petajoules of gas in FY27.

Amplitude Energy shares looking cheap

Macquarie said in its research note that 80% of Amplitude's legacy gas was contracted for the current calendar year, along with 80% of Annie and Artisan.

Macquarie added:

Recent contracts with AGL & Energy Australia have been well timed, and reflect the prudent approach of steadily engaging high quality, well capitalised customers over time and de-risking the project. AEL now has an impressive track record of operational delivery (not the case in exploration, however this could change very soon with Juliet), and production guidance was in line with our expectations.

Macquarie has a price target of $2.45 for Amplitude Energy shares, compared with the current price of $1.62.

The post Macquarie tips this ASX gas company to jump more than 50% appeared first on The Motley Fool Australia.

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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 positions in and has recommended Macquarie Group. The Motley Fool Australia 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.

Shares in Judo Capital Holdings Ltd (ASX: JDO) are deeply in the red over a 12-month period, but after the release of the company's results this week, brokers are tipping a rebound.

The shares fell sharply in late-June after the company announced a downgrade in expected pre-tax earnings from $180 to $190 million down to $163 to $169 million.

Over a 12-month period, the company's shares are 39.6% lower.

But after the company's results this week, the analyst teams at both Morgans and Macquarie are tipping some serious share price upside for the stock.

Judo looking forward after solid profit result

Let's have a quick look at what Judo reported this week.

The company reported a pre-tax profit of $168.1 million, up 34%, with Judo saying this reflected strong revenue growth.

Judo enjoyed above system lending growth, with gross loans and advances of $14.7 billion, up 18% year on year, at the top end of guidance.

Deposit balances also grew 24% to $12.2 billion.

Judo is expecting pre-tax profit to come in at $210 to $220 million for the current year.

Chief Executive Officer Chris Bayliss said regarding the result:

FY26 has been another year of genuine momentum for Judo. While the increase in specific provisions late in the year was disappointing, the underlying performance of the Bank has remained strong, with record revenue, continued operating leverage, strong deposit growth and lending at the top end of guidance. We have continued to deliver above-system growth, underpinned by our customer value proposition of smarter judgement, faster decisions, and stronger relationships. With major investments in our core technology platforms behind us, we are now focused on delivering operating leverage and driving our return on equity. As we continue to scale the loan book, we are seeing more of our revenue growth translate to profit growth. Our cost to income ratio has improved significantly to now be the lowest in the sector3, and will keep improving as we scale.

Judo Capital shares looking cheap

Macquarie said in a note to its clients that the question is "whether Judo is able to achieve that balance between margins, growth, and credit quality to achieve returns at scale''.

The analysts said while it was difficult to be certain, "we think the valuation discount adequately compensates the risks''.

Macquarie has a price target of $1.65 on Judo shares compared to $1.06 currently.

Morgans meanwhile said they expected earnings growth to be in the strong double digits from FY26 to FY28.

They said:

Short-term target price is $1.42/share, but we think by the end of this decade JDO could be worth close to $2/share. JDO is higher risk and more cyclically exposed than the major banks, but investors are compensated by higher potential returns at current prices.  

The post How high will Judo Capital shares go? Brokers have their say appeared first on The Motley Fool Australia.

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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 positions in and has recommended Macquarie Group. The Motley Fool Australia 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.

After posting strong returns so far in August, the median growth-oriented superannuation fund is up an impressive 1.3% already this financial year, according to research company Chant West.

A weak start bolstered by a strong August

Returns in July for the median growth fund, with 61% to 80% growth assets, were a modest 0.3%, however with share markets performing well in August so far, Chant West estimates the median growth fund is up 1.3% over the first seven weeks of the new financial year.

Chant West Head of Superannuation Investment Research, Mano Mohankumar, said that share markets were mixed during July with significant variation in returns across regions.

He said:

Over the month, developed market international shares returned 0.2% in hedged terms, largely due to a flat month from US shares, as the technology sector came under pressure amid concerns about the scale of AI investment and uncertainty surrounding future revenue growth. Due to the appreciation of the Australian dollar over the month, the return in unhedged terms was in the red at -0.9%. On average, super funds have about 70% of international shares unhedged. Emerging markets declined 4.4% where the previously strong performance from the tech sector in South Korea and Taiwan reversed sharply. Australian shares, on the other hand, were up a healthy 2.1% over the month supported by the financials and resources sectors, as well as the markets' relatively low tech and AI-related exposure. Bonds weakened with Australian and international bonds falling 0.4% and 0.9%, respectively, as bond yields rose on renewed inflation concerns.

For July, all growth funds led returns among all superannuation products with 0.5%, while conservative funds were steady at 0% gains.

Superannuation a good long-term bet

Mr Mohankumar said over the longer term, superannuation funds had outperformed their objectives.

He said:

Since the introduction of compulsory super in July 1992, the median growth fund has returned 8% p.a. The annual CPI increase over the same period is 2.7%, giving a real return of 5.3% p.a. – well above the typical 3.5% target. Even looking at the past 20 years, which includes three major share market downturns – the GFC in 2007-2009, COVID-19 in 2020, and the high inflation and rising interest rates in 2022 – super funds have returned 6.9% p.a., which is still ahead of the typical objective.

Over the past 10 years, all growth superannuation products have outperformed all other funds, returning a compound 9.3%.

This compares to growth funds with 7.6% and conservative funds with 4.5%.

Chant West said all risk categories have generally met their typical long-term return objectives, which generally range from inflation plus 1.5% for conservative funds to inflation plus 4.25% for all growth.

The post Superannuation funds have started the financial year well. See how much they're up appeared first on The Motley Fool Australia.

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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.

Shares in EBR Systems Ltd (ASX: EBR) have been on the slide over the past six months, and they're now languishing not too far off their 12-month lows.

Naturally this begs the question, are they cheap at the moment?

The analyst team at Bell Potter thinks so and has a speculative buy recommendation on the company, along with a bullish share price target, which I'll get to shortly.

First let's look at what the company has been up to.

Solid progress on technology sales

EBR has developed a system called WiSE which it says is designed to overcome the limitations of conventional cardiac resynchronisation therapy and, "is the only leadless left ventricular endocardial pacing (LVEP) device''.

The company recently released a quarterly report and said that it had surpassed its hundredth commercial WiSE implant, "with multiple sites performing their first WiSE implants and numerous sites performing their 2nd, 3rd, 4th, and greater cases''.

The company also completed the first two tranches of a fully underwritten $150 million capital raise with the final $35 million expected to be completed by August 24.

EBR Chief Executive Officer John McCutcheon said:

We are extremely pleased with this quarter on multiple fronts. Commercially, EBR surpassed its 100th commercial WiSE implant, with multiple sites performing their first WiSE implants and numerous more experienced sites continuing to treat patients with WiSE. We secured master purchasing agreements with HCA Healthcare, Advocate Health, and CHRISTUS Health, validating the clinical and economic benefit of WiSE in major U.S. healthcare networks. In support of our future commercial efforts, the U.S. Centers for Medicare & Medicaid Services (CMS) further advanced WiSE through the Transitional Coverage for Emerging Technology (TCET) program by formally initiating the National Coverage Determination process for WiSE.

The company also fully transitioned to its new manufacturing facility in California, Mr McCutcheon said.

During the quarter EBR had operating cash outflows of $25 million.

Shares are looking cheap but more capital needed

In a note to clients released after the quarterly results, Bell Potter said that EBR's cash receipts were still modest at US$3.6 million for the quarter but had doubled in the period. Bell Potter also noted that the company has five quarters' worth of cash on hand.

The broker believes the company will need to raise more capital, and has therefore reduced its share price target on EBR to 70 cents, down 22%. This is still well above the current share price of 28 cents.

The broker added:

This still represents significant upside potential, but the need for more funding may weigh on investor sentiment. We retain our BUY (Spec.) rating.

EBR is valued at $214.7 million.

The post Bell Potter tips more than 140% upside for this out of favour ASX biotech appeared first on The Motley Fool Australia.

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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.

When it comes to retirement, it's good to have a handle on how much income you can expect to have on hand to get by on.

How much do you need for a comfortable retimrent?

The Association of Superannuation Funds of Australia (ASFA) calculates a retirement standard each year which is a guide to how much money you need for what they deem to be a comfortable retirement.

A "comfortable retirement" includes the ability to afford top level private health cover, to own and maintain a reasonable car, to maintain your home, and to travel occasionally, among other things.

The figures for a comfortable retirement are currently calculated at $730,000 for couples and $630,000 for singles.

ASFA also assumes that the retiree will draw down all of their capital over time and receive a part Age Pension.

For simplicity's sake, I am going to assume a retiree is living off of dividends alone and not drawing down any capital.

In that case, what sort of income stream can you expect from a $630,000 lump sum?

The figures are pretty simple. If you can achieve a 10% dividend stream you would receive $63,000 per year, and for 5% it would be $31,500.    

I would argue that a 10% dividend yield from shares each year is unrealistic, while 5% is achievable.

Franking credits boost your earnings

You have to remember that once you are retired, you will get the benefit of franking credits from shares which have them attached.

In simple terms franking credits allow you to claim back the tax a company has already paid on their profits, which can be quite lucrative for retirees who are on a zero per cent tax rate.

In practice this means that if you have a full franked share paying a 5% dividend, the actual return will be 7.14%.

There are plenty of shares which will generate these sort of returns.

For steady dividend returns I am a fan of real estate investment trusts, which often hold a large number of diversified assets, therefore reducing risk.

The Charter Hall Social Infrastructure REIT (ASX: CQE) is paying a trailing dividend of 6.88%, while at the smaller end 360 Capital REIT (ASX: TOT) is paying 7.31%.

Among the banks Bendigo and Adelaide Bank Ltd (ASX: BEN) is paying 5.65% while Bank of Queensland Ltd (ASX: BOQ) is paying 6.22%.

Among the resources stocks Fortescue Ltd (ASX: FMG) is paying 6.87% while Woodside Energy Group Ltd (ASX: WDS) is paying 5.03%.

Given these sorts of returns, I'd argue a yield of 7.5% on your superannuation investments is realistic, which would equate to $47,250 per year from a balance of $630,000.

The post How much passive income could I earn from a $630,000 superannuation balance? appeared first on The Motley Fool Australia.

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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 positions in and has recommended Bendigo And Adelaide Bank. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

The WAM Leaders Ltd (ASX: WLE) fund is paying a dividend yield of 7.2%, fully franked, after its investment portfolio returned 14% for the year.

The 4.8 cent per share final dividend brings the total shareholder return for the year to 24.7%, while the grossed up dividend yield including franking credits comes in at 10.3%.

Fund has been performing well

Lead Portfolio Manager Matthew Haupt said it was a solid year.

He added:

The 2026 financial year was characterised by changing interest rate expectations, geopolitical tensions, global trade disruption and evolving views on the sustainability of artificial intelligence-led growth. These conditions created periods of volatility and meaningful shifts in market leadership, generating opportunities for active investors. The investment team and I adjusted portfolio positioning as conditions evolved, including maintaining exposure to areas of the market where we saw attractive risk-adjusted opportunities, while remaining disciplined on valuation. This approach enabled the investment portfolio to outperform the S&P/ASX 200 Accumulation Index during the year.  

Mr Haupt said the fund would remain focused on high-quality companies trading at attractive valuations.

He added:

Periods of market volatility can create opportunities for active managers, and the investment portfolio is positioned to take advantage of these opportunities as they emerge.

Chair Geoff Wilson said the strong investment performance contributed to a 153.5% increase in operating profit after tax of $161.8 million.

WAM Leaders has increased in value by 12% per year since listing in 2016, while also paying out dividends.

Resources and financials paying off

The fund's investments include materials at 24.8%, financials at 20.9%, real estate at 13.6%, and consumer discretionary at 10.9%.

In terms of stocks, its largest holdings are in BHP Group Ltd (ASX: BHP), Commonwealth Bank of Australia (ASX: CBA), National Australia Bank Ltd (ASX: NAB), and Wesfarmers Ltd (ASX: WES).

The fund also on August 10 announced a share purchase plan, allowing shareholders to subscribe for up to $30,000 in new shares.

The fund added:

The Board also announced the successful completion of a placement to professional and sophisticated shareholders. Bids exceeded the initial target raise which resulted in the placement bookbuild closing early and allocations being subject to scale back. The final placement size was increased to $225 million in response to the excess demand. The additional capital will enable the investment team to take advantage of investment opportunities for the benefit of all WAM Leaders shareholders.

WAM Leaders shares were changing hands for $1.33. The fund is valued at $2.06 billion.

The post This investment fund is paying a 7.2% dividend yield after solid results appeared first on The Motley Fool Australia.

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

Pro Medicus Ltd (ASX: PME) shares have surged more than 10% on solid profit results, with the company saying its pipeline of inbound work is "very strong" going forward.

And at least one broker has a bullish share price target on the company, with Barrenjoey expecting the shares to appreciate to $210, up from $197.45 currently, up 12.3% on the day.

Pro Medicus profit increase in the double digits

The digital imaging software company reported full-year revenue of $261.7 million, up 22.9%, while underlying net profit was $144.7 million, up 24.1%.

Pro Medicus remains debt free with cash on hand of $252.3 million, and will pay a fully-franked final dividend of 37 cents per share, up from 30 cents.

On the operational front, the company said it had signed 10 new contracts worth a minimum of $407 million, and renewed six out of six existing contracts worth $141 million on five-year terms.

Pro Medicus Chief Executive Officer Dr Sam Hupert said the result was in line with expectations.

He added:

We were aiming for 30% increases in EBIT and NPAT, and we exceeded both on a constant currency basis. We continue to be able to address a broad range of market segments, with clients ranging from smaller sub specialised health systems through to some of the largest IDNs and academic medical centres in the US. Importantly, we have proven that with one platform and one business model we can address virtually every opportunity in diagnostic imaging, providing us with the largest total addressable market (TAM). Progress made in the cardiology market represents another important string to our bow. We see this trend continuing.

Pro Medicus to get an AI tailwind

Dr Hupert also said the company was becoming more convinced that AI would be a benefit.

He added:

I have always maintained that AI and healthcare are a strong match, particularly in diagnostic imaging, and we are starting to see examples of this emerging. We are ideally positioned to benefit from this transition as we are the radiologist's desktop and therefore the gateway for the output of image-based AI. Our platform is now used by approximately 11% of the US market, including 11 out of the top 20 healthcare institutions in the US and growing. This gives us a very material base upon which we can layer AI, whether it is via our own algorithms, those we co-develop with our research partners or 3rd party algorithms.

During the year, the company invested $10 million in each of 4DMedical Ltd (ASX: 4DX) and Echo IQ Ltd (ASX: EIQ), which Dr Hupert said were strategic investments which had also done well from a return on capital perspective.

Pro Medicus is valued at $18.4 billion.

The post Why are Pro Medicus shares surging more than 10%? appeared first on The Motley Fool Australia.

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Motley Fool contributor Cameron England has positions in Pro Medicus. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has recommended Pro Medicus. The Motley Fool Australia has recommended Pro Medicus. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

Shares in Iress Ltd (ASX: IRE) have been heavily sold off this week following the company's results announcement, begging the question, are they now looking cheap?

The analyst team at Morgans certainly think so, with a buy recommendation on the shares and a share price target which has some serious upside.

We'll get to that shortly. First, let's look at what Iress announced.

Solid results but weaker than expected

The financial data company said on Monday that it had delivered a "solid" result, with improved earnings quality driven by disciplined execution.

Net profit came in at $32 million for the first half, up 85% on the same period in the previous year, while underlying net profit was up 18.4% to $38.8 million.

For the continuing business, revenue increased 2.5% on a constant currency basis to $250 million.

Iress declared a first-half dividend of 14 cents, up 27.3%.

The company's Managing Director Andrew Russell said of the result:

Execution has shifted from simplifying the business to investing in product evolution and sustainable growth. We are evolving our products, accelerating engineering capability and increasing delivery velocity through our partnership with Thoughtworks and the disciplined adoption of AI. While revenue growth is expected to remain measured in the near term, we are confident in our strategy and in delivering our FY26 Cash EBITDA margin exit run-rate target of 25%. Our focus is on building a higher quality software business with better products, stronger customer relationships and disciplined capital allocation to create sustainable long-term value.

For the full year, the company is expecting to grow underlying profit by 15% to 21%.

Shares in this ASX technology company looking cheap

The Morgans team said the result was softer than expected, "with slower revenue momentum along with currency headwinds the main drivers''.

The broker added:

IRE has executed on stabilising the business over recent years. Further efficiency plans are now underway; however, improving the customer proposition and new product initiatives are required to drive organic revenue growth. We view IRE's earnings base as more defendable and free cash flow as largely improving. Corporate appeal adds to the investment case.

Morgans said that Iress had delivered on annualised cost savings of $31.5 million ahead of schedule, and was targeting another $6 to $9 million in savings in the second half.

Morgans reduced its price target for Iress from $10.35 to $9.65. This is still 44.4% higher than the current share price of $6.68.

The broker expects Iress to pay a full-year dividend yield of 4% this year, rising to 4.7% by 2028.

Iress is valued at $1.31 billion.

The post After a steep fall on results, this ASX technology stock could be 40% undervalued appeared first on The Motley Fool Australia.

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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.