But even the best stocks can become too expensive to buy. And that's what most brokers believe has happened with CBA shares.

But don't worry, because there are other ASX financial stocks that could deliver big returns.

Which ASX financial stock?

Bell Potter thinks that COG Financial Services Ltd (ASX: COG) could be seriously undervalued at current levels.

It is a diversified conglomerate of distribution businesses providing access to credit providers for yellow commercial goods. This is delivered through a nationwide broker network.

In addition, Bell Potter highlights that the company has some balance sheet funded direct originations, with a focus on capturing some of the overflow for non-prime chattel mortgages.

Bell Potter has been looking at monthly automotive data and ahead to the Federal Budget and appears to believe there are positives for this ASX financial stock. It said:

Battery electric vehicle (BEV) deliveries have continued to firm and demonstrate growth, counter to the broader market. Feb'26 penetration reached a record 12.2% and volumes grew +92% YoY, with established brands extending their lead, while smaller players gained relevance. Growth is being driven by contributions from the Sealion 7 (medium SUV), Zeekr 7X (medium SUV), and Atto 2 (small SUV), with around one-in-two electric vehicle sales occurring via the novated leasing channel.

An inaugural report showed two thirds of suppliers outperformed their emissions targets. Commercial costs will crystallise in 2028; brands have a similar window each year to offset and manage the liability. A $61m interim liability was recorded for the 2025 performance period, which penalises high-volume players and light commercial vehicles. Passenger vehicles comprised 71% of volumes, with an average carbon emission of 114g/km. The 141g/km benchmark tightens to 117g/km this year, mounting pressure on Hyundai and Mazda, with current potential penalties of $4m and $25m. More demand stimulus from cleaner vehicles will be required to generate saleable offsets, and supply customer wants, without passing on cost.

It believes this supports its view that the company is positioned for strong earnings growth in the coming years.

Big potential returns

According to the note, Bell Potter has retained its buy rating and $2.30 price target on the ASX financial stock.

Based on its current share price of $1.35, this implies potential upside of 70% for investors over the next 12 months.

In addition, Bell Potter expects a much more generous dividend yield than what CBA shares offer. It is forecasting a 5.3% yield over the 12 months, which boosts the total potential return to 75%.

The broker concludes:

Our earnings and Buy rating is unchanged. We would like to see a strategy for the lending business articulated. Data and contract wins confirm our compound growth of +9%, with upside from acquisitions, realised cost synergies and further M&A potential.

The post Forget CBA shares, Bell Potter says this ASX financial stock could deliver a 75% return appeared first on The Motley Fool Australia.

That's because the team at Bell Potter has just named a number of ASX dividend shares as best buys for the month of March.

Listed below are two that it is bullish on. Here's what it is saying about them:

COG Financial Services Ltd (ASX: COG)

This asset finance company could be a best buy according to Bell Potter.

The broker believes it is an ASX dividend share to buy due to its external accumulation strategy, which it expects to support attractive dividend yields. Bell Potter said:

COG Financial is a diversified conglomerate of distribution businesses focused on Australia. The group principally provides access to credit providers (and related insurance) for yellow commercial goods.

This is delivered through a nationwide broker net. In addition, the company has some balance sheet funded direct originations, with a focus on capturing some of the overflow for non-prime chattel mortgages. A proportion of this is offered under peer-to-peer lending. Following the acquisition of Paywise, the company has articulated an external accumulation strategy, focussed on novated leasing and salary packaging services.

As for income, Bell Potter is forecasting fully franked dividends of 7 cents per share in FY 2026 and then 8.9 cents per share in FY 2027. Based on its current share price of $1.35, this would mean dividend yields of 5.2% and 6.6%, respectively, for income investors.

Universal Store Holdings Ltd (ASX: UNI)

Another ASX dividend share that Bell Potter is bullish on is youth fashion retailer Universal Store.

It thinks its shares are undervalued based on its current PE ratio and positive medium-term growth outlook. It explains:

Universal Store Holdings is a leading youth focused apparel, footwear and accessories retailer in Australia. UNI will continue to increase store numbers over the next few years, supporting earnings growth of 10% p.a.. Valuation looks attractive, trading on a forward P/E of ~14.1x. UNI is a quality small cap (ROE ~26%) that is executing on its rollout strategy.

With respect to dividends, Bell Potter is expecting the company to reward shareholders with fully franked payouts of 37.3 cents per share in FY 2026 and then 41.4 cents per share in FY 2027. Based on its current share price of $8.64, this would mean attractive dividend yields of 4.3% and 4.8%, respectively, over the next two financial years.

The post Bell Potter names more of the best ASX dividend shares to buy this month appeared first on The Motley Fool Australia.

For you to be entitled to a stock's next dividend, you must own it before its ex-dividend date.

Here are some of the ASX shares going ex-dividend next week.

ASX shares with ex-dividend dates next week

The post 32 ASX shares about to go ex-dividend appeared first on The Motley Fool Australia.

The S&P/ASX 200 Financials Index (ASX: XFJ) slightly outperformed the ASX 200. 

It rose by just over 7%. 

There were a few ASX financials shares that had stellar years, bringing happy investors strong returns. 

Let's look at three and investigate if they are likely to repeat their strong performance in 2026. 

Consolidated Operations Group Limited (ASX: COG)

Consolidated Operations Group shares were among the best performing in the entire sector over the last year. 

The company is Australia's leading finance broker aggregator and equipment leasing company for small to medium-sized businesses. 

The company has two segments, its finance broker & aggregation business and its lending business.

Its share price is up almost 100% across the last year. 

Is it time to buy, hold, or sell after this impressive gain?

Estimates from brokers indicate it still has more room to run. 

Late last year, Morgans placed a price target of $2.63 on these financials shares and Bell Potter, a buy rating and $2.70 price target. 

These targets indicate a further upside from yesterday's closing price of around 29% to 33%. 

The cherry on top is the expected 3.8% to 4.5% dividend yield over the next two years. 

Ma Financial Group (ASX: MAF)

This financials stock has enjoyed a rise of 85% over the last 12 months. 

It is a diversified financial services company, specialising in managing alternative assets, lending, corporate advisory, and equities.

This has been driven by strong growth in assets under management (AUM).

Investors also reacted positively to the acquisition in late November of Hyperdome Town Centre shopping centre for $678.7 million.

Estimates from analysts indicate these ASX financials shares are now trading close to fair value. 

TradingView has a 12 month price target of $11.27, which is roughly 25% higher than its current share price. 

Navigator Global Investments (ASX: NGI)

Navigator Global Investments shares were another stock market winner in 2025. 

Its share price is up 86% from this time last year. 

The company believes its strong financial performance can continue, with management targeting to double its EBITDA to over US$200 million by 2030.

Estimates from the team at Morgan reinforce that these ASX financials shares can keep rising. 

In December last year, the broker initiated coverage with a buy rating and $3.45 price target.

This indicates a further 15% upside. 

The post Can these high flying financials shares from last year do it again? appeared first on The Motley Fool Australia.

And while this has been a successful move in recent years, there are concerns that the bank's current valuation could limit returns in the medium term.

In light of this, investors might be better off turning to other ASX financial stocks for potential market-beating returns.

Which ASX financial stock?

Bell Potter thinks that COG Financial Services Ltd (ASX: COG) could be a top stock to buy now.

It is diversified conglomerate of distribution businesses across Australia, providing access to credit providers for yellow commercial goods (construction and earth-moving equipment).

In addition, Bell Potter notes that the company has some balance sheet funded direct originations, with a focus on capturing some of the overflow for non-prime chattel mortgages.

Why is it a buy?

The broker believes that the company is well-positioned for growth in the coming years. It said:

We provide building blocks for earnings growth from FY26-27 and incorporate revised interest rate expectations. Acquisitions should contribute +13% accretion, meaning we need to find +17% growth to hit +30% FY26. We think this is possible. Things continue to improve for COG, and now all three divisions are placed to have a positive impact.

FY25 NPATA had an implied -$0.5m headwind despite the broker footprint being unchanged. A rebound in volumes should be supportive, especially with Board experience. Normalisation alone would translate to +2% earnings uplift.

Big potential returns

According to the note, the broker has retained its buy rating and $2.70 price target on the ASX financial stock.

Based on its current share price of $2.09, this implies potential upside of 29% for investors over the next 12 months.

In addition, Bell Potter is expecting COG to pay a fully franked 7.9 cents per share dividend in FY 2026 and a 9.3 cents per share dividend in FY 2027. This represents dividend yields of 3.8% and 4.5%, respectively.

Overall, the broker feels that its shares are too cheap given its positive earnings growth outlook. Speaking about its buy recommendation, Bell Potter said:

We expect +20% EPSA growth from FY26-28. However, the forward multiple of 13x would indicate low appreciation for acquisition integrations, cyclical improvement for the divisions and further consolidation activity. To that end COG screens well in our opinion.

Overall, this could potentially make this ASX financial stock a better option than CBA shares in the current environment.

The post Forget CBA shares and check out this buy-rated ASX financial stock appeared first on The Motley Fool Australia.

Three that have been given accumulate ratings are named below. Here's what the broker is saying about them:

ARB Corporation Ltd (ASX: ARB)

Although this 4×4 automotive parts company's first quarter update was softer than expected, Morgans remains positive. This is because management is working on issues impacting its performance and its exposure to meaningful tailwinds at home and overseas. It said:

ARB's 1Q26 update was slightly softer than expected (1Q26 sales +3.8%; vs 1H26 cons +5.6%), as Export strength (1Q26 +17.6%) offset slower Aftermarket (+1%). Export sales, particularly in the US, continue to strengthen (and appear sustainable), as a slower Aftermarket result was driven by 'fitter' shortages; changing mix of targeted new vehicles; and slower accessorisation rates. ARB is actively addressing these issues, which we expect will improve through FY26. We remain positive on the stock and observe meaningful tailwinds (onshore and off) carrying the group into an improved FY26 result. ACCUMULATE maintained.

Morgans has an accumulate rating and $42.60 price target on its shares.

COG Financial Services Ltd (ASX: COG)

Another ASX share that Morgans is urging investors to accumulate is this financial services company.

It highlights that COG has made an acquisition that is expected to be accretive to earnings per share and increase its share of the novated leasing market. Commenting on the company, the broker said:

COG has acquired an additional 14% stake in Fleet Network (a salary Packaging/Novated Leasing business). This deal is expected to be +5% accretive to EPSA. This transaction follows hot on the heels of COG's recent acquisition of EasiFleet, another Novated Leasing/Salary Packaging business. This shows management's clear intent to aggressively increase COG's market share in the Novated Leasing space. We lift our COG FY26F/FY27F EPS by +2%/+5% reflecting the Fleet Network acquisition. Our price target rises to A$2.63 based on our earnings changes, and also a lift to our SOTP valuation multiple, to more in line with peer levels. With >10% upside to our price target, we maintain our Accumulate rating.

Morgans has an accumulate rating and $2.63 price target on its shares.

Santos Ltd (ASX: STO)

Finally, this energy producer could be an ASX share to accumulate according to Morgans.

In response to its quarterly update, the broker has upgraded its shares to an accumulate rating with a $6.80 price target. It believes that recent share price weakness has created an opportunity for investors. Morgans said:

3Q25 production and sales slightly missed expectations, on WA outages and Cooper flood impact and weaker oil-linked LNG pricing. FY25 production guidance trimmed to 89-91mmboe. After the ADNOC fallout, Santos is a bruised name, but this is at odds with core asset reliability and growth delivery visibility, creating an opportunity. Heavily discounted post-ADNOC, valuation risk-reward now skews to the upside. We upgrade to Accumulate (from Trim), with a revised A$6.80 target price.

The post Morgans is recommending investors accumulate these ASX shares appeared first on The Motley Fool Australia.

Three top ASX shares that leading brokers have named as buys this week are listed below. Here's why they are bullish on them:

COG Financial Services Ltd (ASX: COG)

According to a note out of Bell Potter, its analysts have retained their buy rating on this financial services company's shares with an improved price target of $2.70. This follows news that COG has acquired a non-controlling interest in Fleet Network for $23.9 million. The broker expects the deal to be immediately accretive to earnings per share and is forecasting a 5% boost. Outside this, it highlights that COG has continued to execute strongly across organic and inorganic growth while fast approaching a valuation that reflects its capital efficiency. The COG Financial Services share price is trading at $2.36 on Monday.

GQG Partners Inc (ASX: GQG)

A note out of Macquarie reveals that its analysts have retained their outperform rating on this fund manager's shares with a trimmed price target of $2.50. This follows the release of its latest funds under management (FUM) update which revealed greater than expected outflows. And given the underperformance of its funds due to its defensive positioning, the broker suspects that funds inflows could remain soft in the near term. This has led to Macquarie cutting its earnings per share estimates. However, despite the negatives, the broker believes that investors should be snapping up GQG Partners' shares while they are cheap. Especially given that it is forecasting a generous (~14%) dividend yield from its shares over the next 12 months. The GQG share price is fetching $1.56 at the time of writing.

Netwealth Group Ltd (ASX: NWL)

Analysts at Citi have upgraded this investment platform provider's shares to a buy rating with a $35.00 price target. According to the note, the broker was pleased with Netwealth's performance during the first quarter. It notes that the company delivered stronger than expected net inflows for the period. Looking ahead, it has lifted its estimates to reflect Netwealth's expansion into new segments such as brokers. Citi was also pleased to see the company reiterate its operating expense guidance. It is taking this as a sign that increased compliance requirements will not mean a significant step up in costs. It also sees scope for the company to leverage AI to boost margins over the medium term. The Netwealth share price is trading at $31.30 this afternoon.

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

By sifting through hundreds of smaller names, investors can find hidden gems worth investing in.

In this article, we're going to look at two businesses that are in the portfolio of the listed investment company (LIC) WAM Microcap Ltd (ASX: WMI), which focuses on the smallest growing businesses on the ASX where the fund manager can see a catalyst that could send the share price higher.

While the following two businesses may not become the next Commonwealth Bank of Australia (ASX: CBA), the fund manager Wilson Asset Management is bullish on these ASX small-cap shares with their prospects.

Ai-Media Technologies Ltd (ASX: AIM)

WAM describes AI-Media Technologies as a business that provides the full suite of technology and services needed to accurately caption live broadcasts, in-venue displays and over-the-top (directly to the customer through the internet) content in multiple languages.

The fund manager noted that in September, the company benefited from utilising the annual general meeting (AGM) webcast to feature a live demonstration of LEXI Voice, an AI-powered, real-time multi-lingual voice translation solution.

On 26 September 2025, the ASX small-cap share released the chair and CEO addresses, which highlighted its pivot to a tech-led model and noted the adoption of the LEXI AI suite.

This followed the company's strong full-year results where management spelled out the continued shift towards technology product revenue and reiterated the long-term aspirational targets of $150 million in revenue and $60 million of operating profit (EBITDA) by FY29.

COG Financial Services Ltd (ASX: COG)

The other ASX small-cap share that the fund manager highlighted was COG Financial Services, which it described as Australia's largest aggregator of finance brokers and equipment leasing businesses.

WAM noted the company saw a positive rise gain in September largely due to contract wins and result-driven momentum.

In early September 2025, it announced the $40 million acquisition of EasiFleet, a salary packaging and novated leasing business.

The fund manager highlighted that the acquisition aligns with the company's growth plan being expanding the ASX small-cap share's scale and geographic reach in novated leasing, salary-packaged car leases arranged through employers, while adding complementary customer exposure across its existing brand portfolio.

The company has already been growing consistently in this segment, with FY25 revenue from novated leasing up 22% on the prior year. On top of that, the FY25 result remains a focus for investors after an updated result presentation was announced and fresh substantial holder filings suggested rising institutional investor interest.

WAM concluded about the ASX small-cap share:            

While cyclical factors have weighed on COG's recent earnings, we continue to see long-term upside as management executes a more focused strategy, with the annual general meeting on 6 November 2025 representing the next potential catalyst.

The post These ASX small-cap shares have BIG potential appeared first on The Motley Fool Australia.

Will the market be able to bounce back from this on Monday? Here are five things to watch:

ASX 200 expected to sink

The Australian share market looks set for a tough start to the week following a selloff on Wall Street on Friday. According to the latest SPI futures, the ASX 200 is expected to open the day 84 points or 0.95% lower. In the United States, the Dow Jones was down 1.9%, the S&P 500 fell 2.7% and the Nasdaq sank 3.55%. Traders were hitting the sell button after Donald Trump threatened to put 100% tariffs on China.

Oil prices tumble

It could be a tough start to the week for ASX 200 energy shares Santos Ltd (ASX: STO) and Woodside Energy Group Ltd (ASX: WDS) after oil prices tumbled on Friday night. According to Bloomberg, the WTI crude oil price was down 4.2% to US$58.90 a barrel and the Brent crude oil price was down 3.8% to US$62.73 a barrel. This was driven by concerns that a US-China trade war could impact global economic growth.

ANZ strategy day

ANZ Group Holdings Ltd (ASX: ANZ) shares will be on watch on Monday when the banking giant holds its strategy day event. The big four bank is expected to announce the further transformation of its business. However, the team at UBS believes this could also come with a meaningful reduction in future dividends from current levels.

Gold price rises

ASX 200 gold shares Newmont Corporation (ASX: NEM) and Northern Star Resources Ltd (ASX: NST) could start the week positively after the gold price pushed higher on Friday night. According to CNBC, the gold futures price was up 0.7% to US$4,000.40 an ounce. This was driven by increased demand for safe haven assets.

Buy COG shares

COG Financial Services Ltd (ASX: COG) shares are in the buy zone according to analysts Bell Potter. This morning, the broker has retained its buy rating on the financial services company's shares with an improved price target of $2.70. It said: "We stay Buy rated and turn more cautious. COG has continued to execute strongly across organic and inorganic growth while fast approaching a valuation that reflects its capital efficiency (economic returns above the cost of capital)."

The post 5 things to watch on the ASX 200 on Monday appeared first on The Motley Fool Australia.

Four ASX shares that are rising more than most today are listed below. Here's why they are storming higher:

Brazilian Rare Earths Ltd (ASX: BRE)

The Brazilian Rare Earths share price is up 7.5% to $4.88. This morning, this rare earths developer announced the execution of strategic agreements with Carester SAS. It is a leading western rare earth processing specialist. The strategic agreements are for the supply of heavy rare earth feedstocks and to provide engineering and technical services for Brazilian Rare Earths' planned integrated rare earths separation refinery at the Camacari Petrochemical Complex in Brazil. Management notes that these agreements underpin its strategy to establish Brazil as a leading hub for rare earth production.

COG Financial Services Ltd (ASX: COG)

The COG Financial Services share price is up 13% to $2.38. Investors have been buying this financial services company's shares after it announced the acquisition of an additional 14.1% interest in Fleet Network. It is an existing subsidiary of COG under the Paywise salary packaging and novated leasing platform. Post completion of the transaction, the company will hold approximately 92.4%, with Fleet Network management retaining a 7.6% stake. COG's CEO, Andrew Bennett, said: "Our acquisition strategy of identifying strategic acquisitions to add to the organic trajectory of our business segments at the right price has allowed COG to pursue low risk transactions while delivering on accretion for shareholders. This acquisition in addition to EasiFleet delivered an uplift in pro-forma FY25 EPSA by 22% and contribute $9.6 million in FY25 EBITDA to COG shareholders."

Develop Global Ltd (ASX: DVP)

The Develop Global share price is up 7% to $4.48. This morning, this mining company revealed that it expects to generate outstanding financial returns from its Sulphur Springs project in Western Australia's Pilbara region. Develop Global's managing director, Bill Beament, said: "The case for accelerating Sulphur Springs is clear and compelling. We have a unique opportunity which we intend to maximise by building the underground decline and associated infrastructure at the start of the project, well before we start production mining, significantly de-risking the project and maximising the opportunity at Sulphur Springs."

Guzman Y Gomez Ltd (ASX: GYG)

The Guzman Y Gomez share price is up 1.5% to $27.40. This follows the release of a first quarter trading update and the announcement of a $100 million on-market share buyback. The quick service restaurant operator achieved global network sales growth of 18.6% on the prior corresponding period to $330.6 million. This was driven largely by a 17.4% increase in Australia sales to $305.5 million. In regard to its buyback, the company advised: "In light of this strong financial position, the Board has determined that an on-market share buyback of up to $100 million represents an efficient use of capital and is in the best interests of shareholders. The buyback provides the opportunity to enhance shareholder returns, while maintaining capacity to fund GYG's significant growth ambitions."

The post Why Brazilian Rare Earths, COG, Develop Global, and Guzman Y Gomez shares are storming higher appeared first on The Motley Fool Australia.

Interestingly, data shows September is often a volatile month for ASX shares as investors react to earnings results. 

However, broker Morgans increased its price target on two.

Lets see what the broker had to say. 

COG Financial Services Ltd (ASX: COG)

COG Financial Services Ltd (ASX: COG) is Australia's leading finance broker aggregator and equipment leasing company for small to medium-sized businesses. 

The company has two segments, its Finance Broker & Aggregation business and its Lending business.

It avoided Wednesday's market slump, racing 7% higher followed by a gain of more than 5% on Thursday. 

These were two more days in the green for a company that has seen its share price rocket 100% in the last year. 

Morgans believes this is set to continue. 

The broker increased its price target to $2.14 (previously A$1.98) on earnings changes. 

It was optimistic on the acquisition of salary packaging and novated leasing (NL) business, EasiFleet by COG Financial Services.

This appears a solid deal in our view. We see EasiFleet as a good strategic fit for COG (giving its NL operations greater scale and geographic presence), whilst the financial metrics also appear attractive (high-single-digit accretion, below peer trading multiple paid).

On the back of the deal, Morgans increased FY26F/FY27F EPS by +7-9% respectively reflecting the incorporation of the EasiFleet acquisition into its projections. 

The upgraded price target indicates a potential rise of 7%. 

Regis Resources Ltd (ASX: RRL)

Regis Resources Ltd (ASX: RRL) is a gold production and exploration company based in Western Australia.

Like many gold stocks, it has enjoyed a strong year. 

At the time of writing, it is up 173.86% in the past 12 months. 

Morgans believes the growth isn't finished yet for this ASX share. 

The broker has updated its valuation for Regis Resources following an updated gold price deck. 

Following the material increase in spot gold prices we have updated our spot price scenario assumption to US$3,250/oz (previously US$3,000/oz).

Its new target price of $5.80ps (previously A$5.00) suggests this ASX share could rise 20.33%.

The post This broker just raised the price target on these 2 ASX shares appeared first on The Motley Fool Australia.

Four ASX shares that are not letting that hold them back are listed below. Here's why they are rising:

4DMedical Ltd (ASX: 4DX)

The 4D Medical share price is up 38% to $1.06. Investors have been buying this respiratory imaging technology company's shares this week after it announced that its ventilation-perfusion product, CT:VQ, has received U.S. Food and Drug Administration (FDA) 510(k) clearance. It has then followed this up with another big announcement this morning. 4D Medical revealed that the U.S. Centers for Medicare & Medicaid Services (CMS) have confirmed that reimbursement for the groundbreaking software falls under Category III Current Procedural Terminology (CPT) codes 0721T and 0722T, and will be paid at US$650.50 per scan, effective immediately. Management believes that this is "accelerating the path to broad market adoption."

COG Financial Services Ltd (ASX: COG)

The COG Financial Services share price is up over 7% to $1.88. This morning, this financial services company announced an agreement to acquire salary packaging and novated leasing business EasiFleet for $40 million. This represents a multiple of 6 times FY 2025 EBITDA on a post synergies basis. COG's CEO, Andrew Bennett, said: "With the acquisition of EasiFleet, the Paywise Group now holds contracts with Western Australia, Northern Territory, Tasmania, Queensland and the Australian Capital Territory Governments. This national coverage enables the Group to provide novated leasing and salary packaging services to a significant proportion of the Australian public sector workforce."

Collins Foods Ltd (ASX: CKF)

The Collins Foods share price is up a further 1.5% to $10.41. This KFC restaurant operator's shares have been racing higher this week following the release of a trading update. Collins Foods revealed that for the first 18 weeks of FY 2026, total company sales were up 6.7% on prior corresponding period. This was driven by KFC same store sales growth in all markets. In response to the update, this morning Morgans retained its buy rating on the company's shares with an improved price target of $12.20 (from $10.10).

Ioneer Ltd (ASX: INR)

The Ioneer share price is up 4% to 12 cents. This morning, this mineral exploration company announced a material improvement in project economics for its 100%-owned Rhyolite Ridge Lithium-Boron Project. This includes a 38% increase in unlevered life of mine NPV to US$1,888 million. Managing Director Bernard Rowe said: "Reducing the leach retention time to two days has allowed us to mine and process 25% more ore annually due to the more efficient use of our sulphuric acid. This has resulted in a material increase in production volumes of both lithium and boron chemicals. Importantly, this material improvement does not require additional capital expenditure or change to plant design."

The post Why 4DMedical, COG, Collins Foods, and Ioneer shares are racing higher appeared first on The Motley Fool Australia.

They have recently been named as buys by analysts at Ord Minnett and tipped to offer double-digit returns. Here's what the broker is saying about them:

COG Financial Services Ltd (ASX: COG)

The first ASX stock that could be a buy according to Ord Minnett is COG Financial Services.

It provides equipment financing and broking, aggregation, insurance broking, and novated leasing activities to small to medium-sized enterprises across Australia.

The broker was pleased with the company's decision to offload non-core operations and has boosted its valuation to reflect this. As a result, it has put a buy rating and $1.92 price target on its shares. This implies potential upside of 13% for investors from current levels. It said:

We have upgraded our COG Financial Services valuation to reflect the sale of non-core holdings in Earlypay and Centrepoint Alliance. The $26 million in net proceeds further strengthens the company's capacity to invest in the growth engines of novated leasing, asset finance brokerage and insurance broking. The increased earnings contribution from novated leasing has created a more balanced earnings mix and supports group return on equity (ROE).

Forecast FY25 net profit is likely to be broadly flat on an underlying basis, excluding the EPY/CAF profit contributions. Asset finance industry conditions are generally supported by a lower base interest rate environment and COG Financial Services is well-placed for when the cycle turns. Our target price is now $1.92 and we have an Accumulate recommendation.

ResMed Inc. (ASX: RMD)

Another ASX stock that Ord Minnett rates highly is sleep disorder treatment company ResMed.

The broker was pleased with its "solid" quarterly results, highlighting that it outperformed expectations.

As a result, the broker has retained its buy rating with an improved price target of $48.80. Based on its current share price, this suggests that upside of 10% is possible between now and this time next year.

Commenting on the company, the broker said:

The company's CPAP machines sales in the US were supported by improvements in the diagnostic process and set-up, i.e. getting machines into the customers' bedrooms, while the performance of the masks business was especially pleasing, driven by improvements to distributor supply and the inclusion of two months of revenue from the recent acquisition of Virtuox, a virtual diagnostic testing business.

The sleep apnoea hardware and software equipment supplier remains an appealing investment option, in Ord Minnett's view, with our US industry talks showing strong support from medical practitioners in what is still a large addressable market despite the rise of weight-loss drugs such as Ozempic. We reiterate our Buy recommendation on ResMed and have raised our target price to $48.80 from $45.60.

The post Buy ResMed and this ASX stock for 10%+ returns appeared first on The Motley Fool Australia.

Four ASX shares that are falling more than most today are listed below. Here's why they are dropping:

COG Financial Services Ltd (ASX: COG)

The COG Financial Services share price is down over 6% to $1.25. This follows the release of the equipment finance company's quarterly update. COG reported a 6.9% decline in quarterly net profit after tax (before amortisation) for the three months ended 31 March. This is particularly disappointing as it marks a sudden and sharp slowdown in its profit growth. For example, during the first half, the company's profits were up 11% on the prior corresponding period. Management said: "Our Asset Management & Lending segment has achieved strong originations growth but has been adversely impacted by a margin squeeze due to increased funding interest rates on historical originations.".

Karoon Energy Ltd (ASX: KAR)

The Karoon Energy share price is down almost 3% to $2.16. This energy producer is falling today after a disappointing quarterly update offset news of a jump in oil prices this afternoon. In respect to its update, Karoon Energy's total production for the quarter on a net working interest (NWI) basis came in at 3.11 MMboe. This was weaker than expected and forced management to downgrade its FY 2024 guidance. Karoon Energy's production in FY 2024 is now expected to be between 10.5 MMboe and 12.5 MMboe. This compares to its previous guidance of 11.2 MMboe to 13.5 MMboe.

Netwealth Group Ltd (ASX: NWL)

The Netwealth share price is down 4.5% to $18.88. This appears to have been driven by a broker note out of Citi this morning. According to the note, the broker has downgraded the investment platform provider's shares to a sell rating but with an improved price target of $18.65. While Netwealth's quarterly update was stronger than Citi was expecting, it feels its valuation is full.

Pilbara Minerals Ltd (ASX: PLS)

The Pilbara Minerals share price is down almost 2% to $3.84. This follows the release of the lithium miner's quarterly update this morning. Pilbara Minerals reported a 2% quarter on quarter increase in spodumene production to 179kt and a 3% lift in spodumene sales to 165.1kt. And as was expected, the miner reported a sizeable 28% decline in its realised average price to US$804 a tonne.

The post Why COG, Karoon Energy, Netwealth, and Pilbara Minerals shares are dropping today appeared first on The Motley Fool Australia.

A business like Commonwealth Bank of Australia (ASX: CBA) is solid, but it gets a lot of fund manager and household attention. It's also a very large business that is unlikely to deliver a lot of growth and due to many investors focusing on the big bank, it's not as likely to be cheap as the smaller, undiscovered names.

But it's worth pointing out that just because something is small doesn't mean it will do well. However, the lower valuation could make up for that and give investors a bit of a margin of safety.

The three smaller ASX dividend shares below are ones that are buy-rated and are expected to pay large income yields.

Virgin Money UK (ASX: VUK)

Virgin Money is a UK-based bank. It's not one of the biggest but it is still benefiting from the rising interest rate environment, which is helping its lending margins.

The broker Macquarie thinks the bank is priced cheaply compared to its asset value and a recent share buyback is also useful for shareholders. Macquarie thinks that the ASX dividend share can see rising earnings even if bad debts increase.

On Macquarie's numbers, Virgin Money is expected to pay a dividend yield of 7% in FY23 and it could be valued at six times FY23's estimated earnings.

Lindsay Australia Ltd (ASX: LAU)

The ASX dividend share describes itself as an integrated transport, logistics, and rural supply company. Its focus is on road transport, logistics, and warehousing services as well as specialist services to rural suppliers, with an emphasis on the horticultural industry.

Lindsay is aiming to diversify its revenue sources, which has seen it expand into rail. It has also acquired 27 refrigerated containers in the first quarter of FY23, expanding the fleet to 403 containers. Rail will "continue to deliver revenue growth into FY23", the company says.

With its road segment, it's expanding its trailer fleet to increase operational capacity. In the rural division, it is continuing to explore opportunities to expand in "key horticulture regions" either organically with low-cost start-ups or by acquisitions of established businesses.

It will continue to assess acquisition opportunities that could diversify its geographical reach and range of services.

But it expects the high demand for services to persist. In FY23, it's expecting earnings before interest, tax, depreciation and amortisation (EBITDA) of between $68 million to $71 million.

It's rated as a buy by the broker Ord Minnett, with a price target of 76 cents. It's expected to pay a dividend yield of 6.1% in FY23.

COG Financial Services Ltd (ASX: COG)

This business describes itself as Australia's leading finance broker aggregator and equipment leasing business for small to medium-sized enterprises (SMEs).

In FY23 to date, COG Financial Services has seen underlying net profit (NPATA) rise by 26% year-over-year to 31 October 2022. There has been "strong activity" in all segments and this is expected to continue "given mega trends supporting mining, infrastructure, transport and agriculture".

The company said its scale means it can now support significant investment in its own software platform, giving it "the advantage of having the best offering in the market".

This ASX dividend share is rated as a buy by the broker Ord Minnett with a price target of $2.11. The broker likes the growth the business is seeing in multiple areas. COG Financial is projected to pay a grossed-up dividend yield of 8.6% in FY23.

The post 3 high-yield ASX dividend shares you've probably never heard of appeared first on The Motley Fool Australia.

So today, let's take a look at three such All Ords shares that managed to hit new 52-week highs.

3 All Ords shares at 52-week highs today

BWP Trust (ASX: BWP)

BWP is a real estate investment trust (REIT) that is well-known for owning commercial real estate assets, including several of the warehouses occupied by the Wesfarmers Ltd (ASX: WES)-owned Bunnings. This REIT had a rather strange session.

Yes, it initially rose upon market open to a new 52-week high of $4.35 a unit. But BWP quickly lost steam throughout the day and ended up closing at $4.24, down 0.93% for the day. Even so, the new high watermark still counts.

Austal Ltd (ASX: ASB)

Shipbuilder Austal is next up this Monday. Austal shares also had a strange day of trading today. The company, like BWP, was out of the gate like a bull this morning, quickly rising to $2.79 a share, its new 52-week high.

But investors appeared to get cold feet as well, and Austral shares spent the rest of the day falling away from this new high. The company ended up finishing at $2.64 a share, down 1.49%.

It was only last week that we were discussing another new 52-week high for Austral. So it's certainly been a great week for this company.

COG Financial Services Ltd (ASX: COG)

Third and finally, we have Cog Financial Services. Alone on this list, Cog actually finished in the green this Monday. The company closed at $1.87 a share this afternoon, up a pleasing 4.47%. However, that's not Cog's new 52-week high.

That came at market open when the company rocketed as high as $2 a share. That happens to be Cog's new high watermark. Cog shares are now up close to 20% since 21 July, when the company released a well-received trading update.

The post These 3 ASX All Ordinaries shares hit new 52-week highs on Monday appeared first on The Motley Fool Australia.

It runs a portfolio of high-conviction names. In the latest monthly update, the LIC only had seven positions in its portfolio which it views as long-term holdings.

The LIC is fresh from generating a portfolio performance of a 58.4% return over FY21 and it is still confident about these three ASX shares which just reported during reporting season:

BSA Limited (ASX: BSA)

BSA is a technical services contracting company.

The fund manager said that BSA produced a result consistent with what it has seen for a number years. It was a "credible" underlying result, particularly in the current conditions, but there were a number of one-off costs.

Naos noted that there was commentary about laying the foundations for the future. Underlying margins at the small cap ASX share also increased in FY21, so the fund manager believes that commentary is correct.

Naos was disappointed by the lack of substantial comments about capital management and a lack of tangible progress regarding acquisitions. The fund manager believes that BSA has a sound foundation to build on which "could lead to significant compounding returns for shareholders over time". It is hoped by the fund manager that the potential will start to be realised in FY22.

COG Financial Services Ltd (ASX: COG)

COG, a financial services provider, revealed a result that showed underlying net profit (NPATA) rose by over 132%. Naos noted that the result had increased transparency compared to previous years along with "excellent" cash generation. The fund manager attributed the cashflow generation to COG's capital light, distribution-focused business model.

Naos pointed out that the result allowed the small cap ASX share to grow its dividend by 295%. The dividend payout ratio was 62%.

The fund manager was also pleased that more transparency was also provided about its insurance broking strategy which is now starting to be implemented. The company has stated its ambitions to grow this to 50% of the earnings of the finance broking and aggregation division. Naos said if that can achieved, then the fund manager believes the insurance broking business could potentially contribute $15 million of earnings before interest, tax, depreciation and amortisation (EBITDA) in five years' time.

Eureka Group Holdings Ltd (ASX: EGH)

Eureka was a provider of affordable rental accommodation for independent seniors within a community environment.

Naos said that that Eureka's result confirmed the momentum that the business has building over the last two years. Underlying EBITDA was up around 22% and all key metrics like occupancy levels remain robust.

There was a slight negative that Naos pointed to from the small cap ASX share – there wasn't greater detail revealed on its capital management strategy that would enable the business to scale significantly in the future.

The fund manager thinks that Eureka can become a much larger business but it may not need to own 100% of all of its assets on its own balance sheet. Naos points out there Greg Paramor is on the board, who has a lot of experience at Folkestone and more recently Charter Hall Group (ASX: CHC), he could help the business launch a funds management model which is a strategy Naos believes could be very beneficial for Eureka shareholders over the longer-term.

The post 3 top small cap ASX shares this fund manager likes appeared first on The Motley Fool Australia.

The Motley Fool chats with fund managers so that you can get an insight into how the professionals think. In this edition, NAOS Asset Management portfolio manager Robert Miller reveals 2 ASX shares he loves that play in very different sectors.

Investment style

The Motley Fool: How would you describe your fund to a potential client?

Robert Miller: We offer a boutique funds management business that is focused on ASX-listed industrials, with a focus outside the S&P/ASX 50 Index (ASX:XFL). Our motto across the business is 'conviction, long-term and aligned'. 

We're very concentrated in what we do. We only hold about 20 positions at the moment, approximately, across our total pool of capital. 

We're long-term investors. All of the shareholder funds that we currently manage are structured as listed investment companies. That allows us to be patient and have a disciplined investment strategy, which is typically a 5-year-plus investment timeframe that we're looking at.

Another big one for us is alignment. So we're big believers in investing in businesses alongside founders and management teams that have significant equity ownership in those businesses themselves. 

They're our 3 key points. It's a pure focus on industrial-type businesses and we've got a strong ESG focus internally as well.

Our ASX share portfolio

MF: Can you name a couple of your holdings and why you love them?

RM: The one I'll start with is COG Financial Services Ltd (ASX: COG), which is an asset finance, aggregation and broker group. They're Australia's largest asset finance and broking aggregator. So it has approximately between 17% and 20% of the market. 

We believe this is a very hard asset to replicate in terms of their distribution footprint. So if you think about what's happened with the mortgage and insurance industries, to use two examples, clearly there is an intermediary channel there where brokers are the vast majority — or have a very large influence. 

We believe asset finance is going in the same trajectory as the other two industries, and COG has very much a firm footing in that marketplace, being the largest at what they do. So this gives them the opportunity to cross-sell other products over time because the asset finance relationship between the customer and the broker can be very strong. 

A typical product would be, say you needed to buy a bit of yellow kit for farming or construction building — and you need a tractor or a ute, then COG, through their broker network, are the ones who would organise the finance for that.

I touched on insurance before and, obviously, the key in that market, one of the key ones is Steadfast here in Australia. And some of the ex-Steadfast people, including Cameron McCullagh who set this up, are involved in COG. So it's got that flavour to it. 

They had a very strong FY21 but I think there's a long way to go in terms of the underlying tailwinds that we're seeing in a lot of the industries they operate in. Obviously, agriculture is strong, construction and housing and whatnot, that should be relatively strong over the next little while. 

All of those factors, as well [as] the stimulus around the instant asset write-off programs, should all be beneficial to COG over the medium to longer term.

MF: And the other one?

Again, not necessarily our biggest but a material one for us, is Big River Industries Ltd (ASX: BRI). They're actually [an] over 100-year-old business, despite listing on the ASX in early April 2017, I think it was. 

They're a building supplies and distribution business. And if you think about Bunnings and Mitre 10… they're predominantly retail. This is trade-only so there's absolutely no retail store footprint. 

What they do is, as I said, provide and distribute building supplies. Say frame and truss timber, plywood and formply, and architectural products. They've got approximately 22 sites across the country at the moment where they sell products. And they've got some manufacturing operations as well, where they manufacture niche products like formply and some architectural products.

We think this business is run by an excellent CEO who knows everything inside-out in that business. And we think there's a very big opportunity to grow from here. As I said, they've only got low 20s in terms of the sites they operate. It's a very, very large [addressable] market. We believe, for instance, they've only got one site in Sydney. Their peers would have many more than that in terms of sites per capital city. So there's a long way to go in terms of the upside of site M&A, and also the ability to get strong revenues synergies out of that by, say you're buying a new site, an existing site that rolls into the rest of the group, you then have the ability to cross-sell all of your existing products and distribution capabilities over to that new asset that you've bought. In turn, you get margin expansion with scale, and we're starting to see this materialise now across the BRI group.

Secondly, the building cycle peaked in 2017 and it's been on the down cycle since then. And I think certainly with the example of [government program] HomeBuilder, obviously there's been a lot of building approvals over the last little while. A lot of that's yet to turn dirt. So we think that the building cycle is here to stay for the medium term. It's certainly in the upward trend and this should benefit Big River.

MF: It gives out a dividend as well.

RM: Yes, it does. As I said at the start, it's over a 100-year-old business and they've been paying dividends for a very long time — throughout many, many cycles. For us, that's a big factor that the business is able to survive all kinds of cycles and certainly thrive in some as well, like we're seeing at the moment.

The post This 100-year-old company is the ASX share that keeps giving appeared first on The Motley Fool Australia.

How does Naos Asset Management invest?

Naos is led by chief investment officer (CIO) Sebastian Evans. NAOS Small Cap Opportunities is one of the listed investment companies (LIC) operated by Naos.

That particular LIC looks at businesses with market capitalisations between $100 million and $1 billion.

The fund manager has a number of investment focuses. It looks for businesses that are good value with long term growth potential. With its portfolio, Naos believes it's better to have a quality portfolio rather than numerous holdings. That's why it only holds around 10 positions in each fund, with each ASX share representing a high-conviction position.

Naos invests in the small cap ASX shares for the long-term. It considers the performance and the liquidity of its positions whilst ignoring the index. Performance can sometimes be quite variable when compared to the index.

It looks to invest purely in industrial companies whilst also considering the ESG factors (environmental, social and governance).

Enero Group Ltd (ASX: EGG)

Enero is a collection of businesses relating to marketing and communications.

Naos said that Enero released the strongest result out of all of the businesses in its portfolio. Enero's net profit after tax went up 129% compared to the prior corresponding period. The earnings before interest, tax, depreciation and amortisation (EBITDA) increased to 30% and this helped increase the fully franked interim dividend to $0.105 per share.

The fund manager said that all of the small cap ASX share's public relations and creative agency businesses have shown significant earnings resilience as most of their client base operates within the technology, healthcare and government sectors which have continued to operate relatively normally in a COVID-19-affected environment.

The other main earnings driver was the 50.1% holding of ad-tech business OB Media, which is based in the US.

Naos believes OB Media is on track to earn over AU$22 million of EBITDA, compared to just a couple of million just a few years ago. OB Media has been investing in its technology and people, as well as building relationships with Google and Microsoft. The fund manager said that OB Media is now benefiting from this investment. On a standalone basis, Naos thinks OB Media is worth more than $300 million because it is a high growth technology business that makes a good amount of profit with a negative working capital balance.

COG Financial Services Ltd (ASX: COG)

This small cap ASX share is made up of two different businesses, an asset finance broking arm and a lending arm.

COG announced an initial half-year dividend. Naos said the ASX share's low capital intensity nature of the business has resulted in the business being in a strong net cash position with plenty of flexibility for both capital management and further acquisitions.

The company also provided further clarity about the imminent rollout of its insurance broking capability. The fund manager thinks insurance broking could match the earnings generated by the finance broking divisions when taking a three to five year view.

Big River Industries Ltd (ASX: BRI)

Big River is an integrated Australian timber products small cap ASX share. It's involved from the procurement of raw materials all the way to the sale of finished products to end users.

Naos said that said that Big River Industries' result was strong, with EBITDA growing by 15% and was not affected by COVID-19.

The fund manager pointed out that some new information was provided with the result that could more than double its current annualised net profit run rate of $6.2 million.

The acquisition of Timberwood remains on track with the company trading well and forecast to contribute close to $3 million net profit based on the current run rate.

Naos said the net cash inflow resulting from the closure of the Wagga Wagga facility and subsequent relocation to Grafton is expected to be around $10 million with net profit accretion of around $1.5 million.

The fund manager continues to see the economic backdrop being beneficial for the company which may further contribute to the growth in future earnings.

The post 3 small cap ASX shares that powered higher in February 2021 appeared first on The Motley Fool Australia.

What is Naos Asset Management's investment approach?

Naos is led by chief investment officer (CIO) Sebastian Evans. NAOS Small Cap Opportunities Company Ltd (ASX: NSC) is one of the listed investment companies (LIC) operated by Naos.

That particular LIC looks at businesses with market capitalisations between $100 million and $1 billion.

The fund manager has a number of investment focuses. It looks for businesses that are good value with long term growth potential. With its portfolio, Naos believes it's better to have a quality portfolio rather than numerous holdings. That's why it only holds around 10 positions in each fund, with each ASX share representing a high-conviction position.

Naos invests in the small cap ASX shares for the long-term. It considers the performance and the liquidity of its positions whilst ignoring the index. Performance can sometimes be quite variable when compared to the index.

It looks to invest purely in industrial companies whilst also considering the ESG factors (environmental, social and governance).

COG Financial Services Ltd (ASX: COG)

COG was the only business in the Naos Small Cap Opportunities portfolio to give a meaningful update during January.

This small cap ASX share, as the name suggests, provides a number of financial services including finance, broking, aggregation and it also owns a stake of a debenture issuer.

Naos explained that COG revealed its FY21 half-year net profit after tax and amortisation (NPATA) would be $10.1 million, which would be an increase of 140% compared to the prior corresponding period.

The fund manager was pleased that the profit growth is translating into strong free cash flow with unrestricted cash and term deposits of $53 million (not including the $17 million investment in Earlypay Ltd (ASX: EPY)), compared to a market capitalisation of $149 million with minimal gross debt.

Naos said the small cap ASX share's profit growth was driven by two main factors, the first of these being the finance, broking and aggregation division, where margins have increased as the business continues to improve efficiencies through automation as well as offering complementary services to their clients such as insurance broking.

The other key driver, according to the fund manager, was the increased ownership of debenture issuer Westlawn Finance. Naos believes that Westlawn has continued to be a beneficiary in the growth of the debenture book, as well as the growth of its insurance broking arm.

COG said that it will be rolling out a 'hub and spoke' insurance broking model to all their owned and aggregated broker members in the coming months.

BSA Limited (ASX: BSA)

Naos describes BSA as a solutions-focused technology services small cap ASX share.

BSA assists clients in implementing their physical assets, needs and goals in the areas of building services, infrastructure and telecommunications. BSA clients include the National Broadband Network (NBN), Aldi Supermarkets, Foxtel and the Fiona Stanley Hospital.

The fund manager outlined the investment case for BSA. Even though the company had an eventful 2020, Naos thinks there are some significant catalysts.

The first relates to the $4.5 billion that the NBN is looking to spend over the next three years to continue to upgrade specific parts of the network. Naos believes that the small cap ASX share is well positioned to secure part of this work as it continues to deepen its relationship with the NBN, as demonstrated through its recent contract win.

Secondly, Naos thinks the recent acquisition of Catalyst One provides an opportunity to potentially transform a $15 million revenue business into a $100 million business over the next three to five years if BSA can successfully combine the Catalyst One offering with the existing skillset of the business to offer a one-stop solution for customers around both their current and future wireless capability needs.

The fund manager also said that BSA could be more aggressive with an active buyback and a higher payout ratio could be achieved given the large cash balance on the balance sheet.

The post 2 little-known small cap ASX share picks by this fund manager appeared first on The Motley Fool Australia.