I wanted to find out, so I've put five popular ASX income shares through a hypothetical recession to see which dividends might hold up and which could be cut.

I started with Telstra Group Ltd (ASX: TLS) and Coles Group Ltd (ASX: COL), which provide services and products Australians need every day.

But what about BHP Group Ltd (ASX: BHP), which depends heavily on commodity prices, or JB Hi-Fi Ltd (ASX: JBH), which sells products customers can often put off buying?

I also included banking giant Westpac Banking Corp (ASX: WBC), where rising unemployment and mortgage stress could threaten earnings.

For this exercise, I've imagined a difficult 12 to 18 months, with weaker consumer spending, rising unemployment and falling commodity prices. I've then estimated how these conditions could affect earnings and dividends.

Telstra: Could its dividend survive?

Telstra looks like a natural place to start. Most households aren't going to cancel their phone services just because money gets tight.

That gives Telstra a more dependable source of revenue than many other ASX businesses. But dependable revenue doesn't automatically guarantee a dependable dividend.

The company paid 21 cents per share in FY 2026. That represented approximately 82% of its cash earnings, leaving some room for profits to decline.

In my recession scenario, I've assumed an 8% decline in cash earnings. Some customers might switch to cheaper plans, business spending could slow, and costs could become harder to offset.

Under those conditions, Telstra could still maintain its 21-cent dividend, although it would be paying out almost 90% of cash earnings.

That wouldn't leave much room for error, especially while the company continues investing in its network. Nevertheless, I think Telstra could protect its dividend through a moderate downturn.

That's a fairly reassuring result. But the other four ASX income shares tell a more complicated story.

In my calculations, one familiar dividend payer could reduce its annual payment by more than a third. And even a market-leader might struggle to maintain its dividend.

Here's what I found.

BHP: A big dividend cut wouldn't necessarily be bad news

BHP is one of Australia's best-known ASX income shares, but its payments are more exposed to economic conditions than those of Telstra.

The mining giant relies heavily on demand for commodities such as iron ore and copper. If a global recession causes prices to fall sharply, its profits could decline substantially, even if its operations continue performing well.

And that would almost certainly have consequences for shareholders' income. BHP paid US$1.72 per share in FY 2026, distributing approximately 66% of underlying profit. However, its dividend policy only commits it to paying out a minimum of 50%.

In my recession scenario, I've assumed a 35% decline in underlying earnings, which could see the annual dividend fall to around US$1.10 per share if the company maintains its recent payout ratio.

For investors depending on a consistent income stream, I think this makes BHP a less dependable choice than its long history of paying dividends might suggest.

Coles: Defensive sales, but less room for mistakes

Coles sells food and everyday essentials, so I wouldn't expect customers to stop shopping there during a recession.

However, shoppers could trade down to cheaper products, while Coles might need to invest more in prices to defend its market share.

Its FY 2026 dividend was 78 cents per share. The company generally targets paying out 80% to 90% of earnings, leaving a relatively small buffer if profits fall.

I've assumed a 15% decline in underlying earnings, reflecting tougher competition and pressure on margins rather than a collapse in grocery sales.

If Coles kept paying roughly the same proportion of profits, its dividend could fall to around 66 cents per share. That's approximately 15% less income.

I still regard Coles as one of the more resilient businesses in this group. But maintaining the dividend would require management to temporarily pay out a much greater share of earnings.

JB Hi-Fi: The consumer spending test

JB Hi-Fi faces a very different challenge. Australians might delay replacing a television or upgrading their appliances when money is tight.

And we're already seeing signs of caution. The retailer recently reported weaker comparable sales in Australia and slowing trading during October.

Its FY 2026 ordinary dividend was $3.37 per share, representing 75% of profits.

In my downturn scenario, I've assumed earnings fall 25%. That might seem harsh, but relatively modest declines in retail sales can cause larger drops in profits when operating costs don't fall at the same pace.

Maintaining its recent payout ratio would produce a dividend of around $2.53 per share.

The good news is that JB Hi-Fi finished FY 2026 with $206.5 million in net cash. That provides flexibility, but I wouldn't assume management would automatically use it to maintain dividends while profits declined sharply.

Westpac: Mortgage stress could reach shareholders

Finally, there's Westpac, which paid fully franked dividends of $1.54 per share in FY 2026.

This ASX income share's latest results showed credit impairment charges more than doubling, although the bank remains well capitalised.

In a recession, rising unemployment and weaker business conditions could produce further loan losses.

I've assumed a 20% fall in earnings. If Westpac continued paying out around three-quarters of profits, its annual dividend would decline to approximately $1.23 per share.

It is worth considering that Westpac's strong capital position offers protection, so a cut isn't inevitable in this scenario. But I wouldn't regard its dividend as untouchable.

So, whose income looks safest?

Telstra emerges as my strongest candidate to maintain its current dividend under this scenario.

Coles could prove resilient too, although its high payout ratio leaves less flexibility than its defensive business might suggest.

BHP, JB Hi-Fi and Westpac could all deliver smaller payments, but for different reasons.

Overall, I think this shows that if you're investing for income, it is worth asking not just how much a company pays today, but what it could afford to pay when conditions become difficult.

The post Would your dividends survive a recession? I stress tested 5 popular ASX income shares to find out appeared first on The Motley Fool Australia.

It's understandable why the ASX retail share has suffered such a large decline – investors are now worried about how sales and earnings could perform for the foreseeable future amid a tougher retail environment.

Is the company now undervalued? I like looking at sold-off stocks because there could be a real opportunity with a beaten-up leading retailer.

On 29 October 2026, the company announced its annual general meeting (AGM) update, which revealed some interesting sales numbers.

Sales recap

The business reported how it performed in the first quarter of FY27, being the three months to 30 September 2026.

JB Hi-Fi Australia saw total sales decline by 0.4%, with a comparable sales decline of 1.4%.

The Good Guys experienced total sales drop by 0.1%, with a comparable sales decline of 0.4%.

JB Hi-Fi New Zealand managed to grow total sales by 17.3%, aided by comparable sales growth of 10.7%.

Finally, there's the recently-acquired E&S business, which saw total sales decline by 3.7% amid a comparable sales drop of 4.5%.

Considering its two main Australian businesses have each seen total sales fall by less than 0.5%, the 40% decline seems like an overreaction to me.

Yes, there may be a bit of a further deterioration of trading conditions during FY27, but there's a fair chance the market has already seen the bottom of the JB Hi-Fi share price. It's normal for the share price to hit the lowest point before the financial result shows the lowest level of profit generation. Share prices move in anticipation of an upcoming result (or results).

Why I think the JB Hi-Fi share price is a buy

JB Hi-Fi doesn't sell basic essentials like food, electricity, gas, or water. It makes sense that the market may be worried by the outlook for household spending on electronics and appliances.

But, I don't think inflation, and therefore interest rates, will stay elevated forever. Therefore, weakness now could be a great time to invest and hold until there's an increase of customer demand again.

JB Hi-Fi can compete strongly in its industry with leading promotions and win at key sales events, drive operational improvements, and reinvest in customer-facing roles. The company says that its knowledgeable, passionate, and authentic team members are its key competitive advantage, and it'll continue investing in customer service.

It also plans to improve its online offering further, including with agentic e-commerce experiences, and invest in its supply chain.

Store growth can also help improve its financials. In FY27, it plans to open four new JB Hi-Fi Australia stores, open two new JB Hi-Fi New Zealand stores, and open one new The Good Guys store (as well as upsizing two undersized stores). It's also planning to expand the E&S store network outside of Victoria.

According to the earnings projection on CommSec, it's valued at 15 times FY27's estimated earnings, which I think is appealing considering it's forecast to grow its earnings by a total of 13% between FY27 and FY29.

The post Is the JB Hi-Fi share price a buy in November? appeared first on The Motley Fool Australia.

Bunnings failing to fire

This was shown most markedly in Wesfarmers Ltd (ASX: WES) being one of the worst performers in early trade, with its shares down 3.2% to $74.68.

The company's Managing Director Rob Scott said they had had a "reasonable" start to the year, with a strong operating performance from the company's mining operations offsetting some moderation in retail demand.

Mr Scott noted the impact of increased interest rates on consumers as well as higher inflation.

In the company's Bunnings division, sales growth had moderated since the second half of FY26, Mr Scott said.

He added:

Despite a stronger start to the quarter, lower sales across seasonal categories and the commercial segment in recent weeks has weighed on overall sales performance.

The Kmart and Officeworks divisions posted sales growth, "broadly in line with the second half of the 2026 financial year''.

RBC Capital Markets said the update was negative, and while no specific trading update was given, the key takeaway was the softness in sales at Bunnings.

Sales slide at electronics retailer

JB Hi-Fi Ltd (ASX: JBH) also put out a trading update, with its shares drifting 0.4% lower to $70.38.

Total sales for the company's Australian JB Hi-Fi operations fell 0.4% for the first quarter, while comparable sales were down 1.4%.

The New Zealand division delivered strong comparable sales growth of 10.7%.

The Good Guys delivered comparable sales down 0.4%.

The company said it "continues to see variability in trading and heightened competitive activity, with customers remaining focused on value and increasingly shopping during promotional events''.

The company said it had experienced a slowing in sales in October, ahead of the Black Friday and Christmas trading periods.

RBC Capital Markets said JB Hi-Fi missed expectations for sales in its Australian division, however performed better than expected in New Zealand.

RBC said the update was negative for the stock, however, its price target on JB Hi-Fi is still higher than the current price at $73.

Super Retail also limping along

And finally, Super Retail Group Ltd (ASX: SUL) shares were down 2.2% to $12.72 after the company reported its quarterly results.

Group sales were up 2% on the same period last year, while like-for-like sales were up just 0.2%, with wide variability across its divisions.

Supercheap Auto delivered like-for-like sales growth of 2.5%, Rebel grew 0.3%, while BCF fell 1.1%, and Macpac plunged 11.7%.

RBC Capital Markets said sales trends appeared weak across the board, having slowed down since the recent seven week trading update, and they expected consensus downgrades for the company from analysts.

RBC's price target on Super Retail Group shares is $15.60.

My takeaway

Taken together, these three trading updates indicate that Australian retailers are struggling to grow top line sales.

JB Hi-Fi and Bunnings in particular have been strong performers over a long period of time, and to see them struggle to grow sales indicates that consumers are wary of spending.

With another interest rate increase almost certain next week, things are only likely to get harder.

The post Are Australian retailers in trouble? These three results suggests they are appeared first on The Motley Fool Australia.

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

ASX 200 expected to rise

It looks set to be a good session for Australian investors following a solid night on Wall Street. According to the latest SPI futures, the ASX 200 is expected to open the day 40 points or 0.45% higher this morning. In the United States, the Dow Jones rose 0.2%, the S&P 500 climbed 0.3%, and the Nasdaq jumped 0.3%.

Wesfarmers update

Wesfarmers Ltd (ASX: WES) shares will be on watch on Thursday when the conglomerate releases a trading update ahead of its annual general meeting. Investors will be looking for signs that Bunnings and Kmart are continuing to perform well in FY 2027. Also holding events today and likely to release updates are Challenger Ltd (ASX: CGF), JB Hi-Fi Ltd (ASX: JBH), Perpetual Ltd (ASX: PPT), and Super Retail Group Ltd (ASX: SUL).

Oil prices rise

ASX 200 energy shares including Woodside Energy Group Ltd (ASX: WDS)and Santos Ltd (ASX: STO) will be on watch today following a positive night for oil prices. According to Bloomberg, the WTI crude oil price is up 1.8% to US$101.69 a barrel and the Brent crude oil price is up 0.15% to US$114.03 a barrel. Traders were buying oil in response to reports that the US is planning strikes on Iran.

Buy Life360 shares

Life360 Inc. (ASX: 360) shares could be good value according to the team at Ord Minnett. The broker has resumed coverage on the location technology company's shares with a buy rating and $29.40 price target. Based on its current share price of $20.65, this implies potential upside of 42% for investors over the next 12 months. The broker is bullish on Life360's outlook, partly due to the potential growth of its advertising business.

Gold price rises

It could be a reasonably positive session for ASX 200 gold shares Newmont Corporation (ASX: NEM) and Northern Star Resources Ltd (ASX: NST) on Thursday after the gold price edged higher overnight. According to CNBC, the gold futures price is up 0.2% to US$4,083.5 an ounce. This follows the US Federal Reserve's decision to keep interest rates on hold.

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

It's harder than it looks. 

Pinpointing the best ASX shares isn't just about finding the shares that look like the best value for money, the highest dividend, or the companies with the best potential upside.

I'm focused on the companies that can generate an income and also help build long-term wealth.

So I analysed the market for ASX shares with stable, reliable dividends, strong earnings, and long-term growth potential.

Here are three that stood out.

Telstra Group Ltd (ASX: TLS) shares

Telstra shares tick a lot of my boxes.

As an ASX telecommunications business, Telstra's services will be in strong demand regardless of inflation levels, cost of living, or economic conditions. After all, the telco owns and operates Australia's largest mobile network, and is also a major home internet provider. 

That means it's a classically defensive ASX share.

And the best part about defensive shares is they're also able to generate stable and consistent earnings and revenue.

Which also means they can pay a reliable passive income to shareholders through dividend payments.

Telstra pays its shareholders two dividends every year, in March and September, dating back to 2004. The company quite frequently throws in a special cash dividend, too.

It paid its shareholders a partially-franked 10.5 cent-per-share dividend in March, and a final 9.5 cent fully-franked dividend last month. That totals 21 cents for FY26, giving a dividend yield of around 4.2%, which is pretty decent.

The dividend is expected to keep climbing higher, too.

Based on the latest CommSec forecasts, the telco is also expected to pay a total dividend of 22 cents per share in FY27. That translates to a forward dividend yield of around 4.5%.

It's clear why. 

Telstra reported strong financial results for FY26. Highlights include a 4% year-on-year increase in underlying EBITDA to $8.3 billion. And a 4.9% increase in underlying NPAT, to $2.5 billion.

And the company expects continued growth going forward. This will be driven by its mobile network dominance, and its expansion into high-margin digital infrastructure. Data demands from AI and cloud computing will also continue to drive Telstra's earnings higher.

For FY27, Telstra expects underlying EBITDA growth. It is guiding earnings in the range of $8.5 billion and $8.8 billion.

Analysts are pretty bullish about Telstra's share price potential, too.

TradingView data shows seven out of 16 analysts have a buy/strong buy rating on the telco's shares. Another eight have a hold rating. The $5 average target price implies a modest upside of around 1% at the time of writing. Although some think the shares could jump another 11% to $5.50 over the next 12 months.

JB Hi-Fi Ltd (ASX: JBH) shares

JB Hi-Fi is fundamentally a cyclical, consumer discretionary company, which means it relies heavily on household retail spending and is affected by interest rate rises and inflation woes.

But the benefit of this type of stock is that because its business is closely tied to the economic cycle, it can experience a huge rebound when the economy shifts.

When interest rates eventually fall or consumer confidence rebounds, I expect earnings of companies like JB Hi-Fi to bounce back rapidly, driving a sharp share price rally.

Meanwhile, because JB Hi-Fi is a more mature company, it doesn't need to invest heavily into aggressive expansion plans. Instead, it is able to return a decent volume of its profits directly back to its shareholders.

JB Hi-Fi has paid its shareholders two fully-franked dividends every year since 2016. 

The company paid its shareholders a $2.10 dividend in March, and another $1.27 dividend last month. That totals $3.27 for FY26, giving a dividend yield of around 4.6% at the time of writing.

JB Hi-Fi's earnings are impressive, too.

For FY26, the company reported a 4.8% increase in revenue, to $11.064 billion, and a 6% increase in NPAT, to $489.9 million.

Looking ahead, JB Hi-Fi expects what it calls a "variable trading environment" in the short term but it expects to benefit from ongoing resilience among its brands. 

Management is also focused on driving demand, expanding its store network (with new store openings planned), and investing in digital capability, supply chain initiatives, and sustainability.

Again, the experts are optimistic that the ASX shares could climb higher over the next 12 months.

TradingView data shows that the majority (seven out of 16 analysts) have a buy/strong buy rating on JB Hi-Fi shares. Another six have a hold rating. The $76.81 average target price implies an upside of around 5% at the time of writing. Although some think the shares have the potential to jump another 28% to $94 each over the next 12 months.

Worley Ltd (ASX: WOR) shares

Worley shares weren't really on my radar until my latest deep dive into ASX shares. The company provides professional expertise in engineering, procurement, and construction management to the oil, gas, mining, chemicals, power, and infrastructure sectors.

Because it sits within the industrials sector, its revenue is closely tied to capital expenditure budgets of mining, oil, or gas companies. 

But the good news is that Worley does also have some defensive characteristics. A large portion of its revenue comes from recurring asset maintenance and optimisation services. That means its income is impressively stable.

And of course, this is great news for its shareholders.

The company has a long history of paying dividends. Since 2018, it has paid two unfranked dividends every year, in April and September. Since 2020, the company has paid the same 50-cent annual dividend.

The company also has a history of paying dividends dating back to 2004.

Worley's total 50-cent dividend for FY26 translates to a dividend yield of 5.3% at the time of writing.

The company's latest financial results show how consistent its earnings are. For FY26, the engineering services company reported a statutory NPATA of $306 million, with aggregated revenue largely unchanged at $12 billion.

Looking ahead, Worley is optimistic that growth can continue. Its management is guiding mid to high-single-digit increases in both aggregated revenue and underlying EBITA for FY27, with stronger activity in the second half of the financial year.

The company also said it is focused on expanding project delivery capability, investing in AI and digital platforms, and targeting high-growth sectors, including integrated gas and energy transition materials. 

It is also planning strategic partnerships and investments to help expand its size and presence in the power, data centre, and critical infrastructure markets.

The experts are optimistic that the ASX shares could explode much higher over the next 12 months.

TradingView data shows the experts are split between a buy/strong buy rating and a hold rating on Worley shares. But they all forecast a strong upside ahead.

The average $11.60 target price implies an upside of around 22%. Whereas the more bullish of the bunch expect the ASX shares to jump 53% higher to $14.50 at the time of writing.

The post I compared dividends, earnings, and growth across the ASX: These 3 shares stood out appeared first on The Motley Fool Australia.

Let's check out some new ratings from three experts today.

Xero Ltd (ASX: XRO)

The Xero share price is $63.25, down 1.8% today and down 59% over 12 months. 

Toby Grimm from Baker Young has a buy rating on this ASX 200 tech share. 

Grimm explained (courtesy The Bull):  

Xero is an accounting software provider. Concerns about future growth rates due to perceived competitive threats from AI tools remain.

But we believe the material decline in XRO's share price amid the company continuing to deliver operational performance inline or above market guidance has created a compelling value opportunity.

We believe small to medium sized firms handling critical financial information will continue using trusted third party suppliers rather than develop their own systems.

XRO's strong growth rates justify higher than average multiples, in our view.

We're comfortable building positions for longer term investors around current levels.

Northern Star Resources Ltd (ASX: NST)

The Northern Star Resources share price is $24.85, down 0.8% today and up 5% over 12 months. 

Morgans kept its hold rating in place on this ASX 200 gold share after reviewing the miner's 1Q FY27 results.

The broker has a 12-month share price target of $25 on Northern Star Resources shares.

Morgans said: 

A solid start to FY27. Gold sold of 364koz beat MorgansF and consensus, and AISC of A$3,217/oz was 8% below consensus, led by KCGM and Yandal. Pogo was weak.

FY27 guidance is unchanged and the KCGM ramp-up remains the key operational watch point.

New CEO Suresh Vadnagra's plans for the portfolio are likely a few months away.

In the meantime, market focus remains on a potential increase in the Gold Fields offer and KCGM commissioning performance.

JB Hi-Fi Ltd (ASX: JBH)

The JB Hi-Fi share price is $71.47, down 1.9% today and down 38% over 12 months. 

Michael Gable from Fairmont Equities reckons it's time to sell this ASX 200 consumer discretionary share. 

Gable said: 

We tipped this retailer as a sell in TheBull.com.au in early May in response to increasing interest rates and fuel prices pressuring discretionary retail stocks.

Since then, we've seen a Federal budget impacting consumer confidence and household wealth on top of more interest rate rises.

With consumer confidence near record low levels amid higher petrol prices, we don't see a path to recovery for retail stocks like JBH until later in 2027 when interest rates may finally be cut.

The post Buy, hold, sell: JB Hi-Fi, Xero, Northern Star Resources shares appeared first on The Motley Fool Australia.

If you're eyeing the next potential bargain in Australian retail, you might be weighing up JB Hi-Fi Ltd (ASX: JBH) and Lovisa Holdings Ltd (ASX: LOV). Both are iconic ASX retailers that have seen their share prices drop this year, leaving many investors asking: Which is more likely to double from here? Let's dig into the fundamentals, value, and momentum for both JB Hi-Fi and Lovisa.

The case for JB Hi-Fi

JB Hi-Fi is one of Australia and New Zealand's best-known specialty retailers, focusing on consumer electronics, white goods, and home entertainment through brands including JB Hi-Fi itself, The Good Guys, and e&s. The company operates large-format stores and a growing online presence, appealing to value-focused shoppers chasing tech and appliances.

Looking at JB Hi-Fi's key fundamentals:

• Market cap: $7.81 billion
• P/E ratio: 16.12
• Dividend yield: 4.68% (fully franked)
• Earnings per share: $4.467
• Year to date return: -21.66%

That juicy fully franked dividend (100% franked) appeals to income investors, while the P/E ratio suggests a more moderate valuation than Lovisa. The company's long track record, defensive category mix, and brand recognition might appeal if you think beaten-down retailers are primed for a comeback.

JB Hi-Fi operates a substantial retail network across Australia and New Zealand, supported by a steadily growing online channel – though the actual store count isn't specified in the current data.

The case for Lovisa

Lovisa is a global fast-fashion jewellery and accessories retailer. Launched in 2010, Lovisa has scaled up rapidly, with stores now spanning over 50 countries. The chain sells trendy and affordable jewellery, targeting style-conscious customers wanting the latest looks, both in brick-and-mortar stores and online.

Lovisa's standout metrics include:

• Market cap: $2.68 billion
• P/E ratio: 28.32
• Dividend yield: 3.52% (partly franked)
• Earnings per share: $0.792
• Year to date return: -13.68%

Lovisa's growth story is evident in its rapid expansion and international reach. However, its current dividend is only 50% franked and the yield is lower than JB Hi-Fi's. The company's higher P/E ratio may suggest the market expects stronger growth ahead—or is simply pricing in its excellent global execution.

Lovisa has built a global store footprint and vertically integrated supply chain, but the specific number of stores should be treated as an approximate figure.

Valuation comparison

Here's how the key numbers stack up:

JB Hi-Fi stands out for its bigger dividend and full franking, while Lovisa's P/E is considerably higher. This suggests the market is expecting faster earnings growth from Lovisa, or pricing in its status as a high-growth global retailer.

Recent share price momentum

Comparing recent share price momentum up to 15 October 2026:

• JB Hi-Fi closed at $71.41, down -21.66% year to date.
• Lovisa Holdings closed at $24.16, down -13.68% year to date.
• In the last trading session, JB Hi-Fi fell 0.83%, while Lovisa dipped 1.15%.

Both have lagged the broader market lately, but JB Hi-Fi has fallen further YTD than Lovisa. That may put JB Hi-Fi in the more "beaten down" category—possibly creating greater rebound potential if sentiment turns around.

Which is the better buy?

If I had to pick which retailer is more likely to double from here, my money would be on JB Hi-Fi. Here's why: JB Hi-Fi's share price has fallen further, its P/E ratio is much lower, and the dividend yield is nearly a full percentage point higher—plus it's fully franked. While Lovisa is a cracking global growth story, the market's already paying up for that growth, as seen in its P/E. JB Hi-Fi, on the other hand, looks oversold relative to its steady earnings and income stream. If retail sentiment rebounds, I reckon JB Hi-Fi has more room to snap back hard.

That said, both are quality operators, and Lovisa's growth could surprise to the upside if global expansion continues apace. But on the numbers given—and if you're looking for the one retailer with the more compelling chance of doubling after a bruising year—my pick would be JB Hi-Fi.

The post JB Hi-Fi vs Lovisa: Which beaten-down ASX retailer could rebound strongly? appeared first on The Motley Fool Australia.

Let's start the week with some new ratings from market experts (courtesy The Bull). 

JB Hi Fi Ltd (ASX: JBH)

The JB Hi-Fi share price has tumbled 37% over 12 months.

Andrew Wielandt from DP Wealth Advisory has a buy call on this ASX 200 consumer discretionary share. 

Wielandt said: 

This consumer electronics giant continues to show why it's one of Australia's highest quality retailers.

The company delivered record total sales of $11.06 billion in full year 2026, up 4.8 per cent on the prior corresponding period.

Net profit after tax of $489.9 million increased 6 per cent. The total fully franked dividend of $3.37 was up 22.5 per cent.

The company continues to take market share through its low cost operating model, strong brand recognition and leadership across consumer electronics.

Our recommendation is supported by a proven management team, strong cash generation and a history of executing well during varying economic conditions.

Sandfire Resources Ltd (ASX: SFR)

The Sandfire Resources share price is up 31% over 12 months. 

Michael Gable from Fairmont Equities has a hold rating on this ASX 200 copper share. 

Gable said: 

SFR is Australia's largest listed pure play copper producer. Copper demand is increasing in an environment of low supply and this is likely to lead to higher prices.

Group sales revenue of $1.7 billion in full year 2026 was up 41 per cent year on year. Profit after tax of $354 million was up 294 per cent.

Its final fully franked dividend of 35 cents a share was much higher than the market was expecting.

From a charting perspective, the price action for SFR looks bullish and we expect to see a sustainable uptrend from here.

Ramsay Health Care Ltd (ASX: RHC)

The Ramsay Health Care share price has streaked 77% higher over 12 months.

Toby Grimm from Baker Young has a sell rating on this ASX 200 healthcare share. 

Grimm explained: 

Ramsay Health Care is one of the largest private hospital operators in Australia. It has additional operations in the UK and Europe.

Ramsay's operations have improved. Insurer pricing better reflects cost inflation, with higher demand and higher margin procedures prioritised.

Yet the industry remains challenging and public sector competitors effectively set input costs without needing to operate profitably.

The stock has strongly rallied in the past 12 months to the point we believe it's exposed to a pullback.

The forward price/earnings ratio has risen significantly above its 10-year average.

Investors may want to consider booking profits and monitor performance from the sidelines.

The post Buy, hold, sell: JB Hi-Fi, Sandfire Resources, Ramsay Health Care shares appeared first on The Motley Fool Australia.

With plenty of uncertainty in Australia's economic outlook, many investors are weighing up defensive consumer staples like Woolworths Group Ltd (ASX: WOW) against more cyclical consumer discretionary options like JB Hi-Fi Ltd (ASX: JBH). If you're wondering where your next investment dollar is better placed—staples or discretionary—let's dive into the numbers, business strengths, and recent performance data to help you decide between Woolworths shares and JB Hi-Fi shares.

The case for Woolworths Group

Woolworths is one of Australia's retail heavyweights, mainly known for its vast network of supermarkets across Australia and New Zealand. It also owns Big W, giving it a strong presence in both everyday groceries and discount department stores. While Woolworths previously had significant interests in liquor and hospitality, it split these off in 2021 to form Endeavour Group.

Woolworths' main drawcard is its defensive profile. No matter how the economy is tracking, people still need to buy food and essentials, making Woolworths a classic 'consumer staples' play. Its massive market capitalisation of $46.69 billion reflects the size and reach of the group. With a current P/E ratio of 41.21, it's trading at a premium—likely a nod to its stability in uncertain times. The stock offers a fully franked dividend yield of 2.54%, and dividends have been consistent over the years, as shown by its steady payout history. Woolworths' shares have returned an impressive 33.1% so far this year.

The case for JB Hi-Fi

JB Hi-Fi sits firmly in the consumer discretionary camp, focusing on electronics, appliances, and home entertainment through its JB Hi-Fi, The Good Guys, and e&s stores. While the business has shown the ability to ride waves of demand for gadgets and household gear, its sales are more sensitive to consumer confidence and economic cycles compared to the staples sector.

JB Hi-Fi has a market capitalisation of $7.69 billion—much smaller than Woolworths, but still a major player on the ASX. Its most striking feature is value: a P/E ratio of just 15.74, noticeably lower than Woolworths', and a hefty 4.79% fully franked dividend yield. Its earnings per share stands at 4.467—substantially above Woolworths' 0.925 EPS figure. JB Hi-Fi's dividend payments have also grown over recent years, reflecting its cash-generative business. However, the share price has fallen 23.5% year to date, a reminder of the higher risk and volatility faced by discretionary retailers when economic conditions sour.

Valuation comparison

Here's how the core valuation numbers stack up for both companies:

Note: Woolworths Group Ltd's reported P/E and EPS figures may be based on different earnings measures, which can cause apparent mismatches between the calculated and reported ratios.

Woolworths' much higher P/E ratio indicates investors are paying up for perceived safety and stability, while JB Hi-Fi trades on a lower earnings multiple but offers a higher dividend yield and much stronger earnings per share.

Recent share price momentum

Comparing recent share price performance up to 7 October 2026:

• Woolworths Group closed at $38.22, with a modest 0.26% gain on the day. Its shares have shown positive momentum year to date, up 33.1%.
• JB Hi-Fi closed at $70.36, rising just 0.10% for the day, but with a sharp -23.5% return year to date—reflecting tough consumer conditions.

Which is the better buy?

If I had to pick between Woolworths and JB Hi-Fi in today's economic climate, my choice would be Woolworths. Here's why: defensive consumer staples like groceries and everyday essentials tend to hold up better when interest rates are high and households tighten the purse strings. Woolworths' high P/E ratio clearly shows investors are paying a premium for perceived safety, but the company's consistent, fully franked dividends and solid price performance this year back up that defensive reputation.

On the other hand, while JB Hi-Fi offers much stronger earnings per share and a very appealing dividend yield, its hefty share price drop year to date points to real challenges in the discretionary retail space. That doesn't mean JB Hi-Fi isn't a good business—far from it—but in a choppy economy, I think defensive shares like Woolworths look more attractive, even at a higher valuation.

For those who crave stability and steady income, I'd lean toward Woolworths shares right now. But if the economic outlook brightens and consumer spending bounces back, JB Hi-Fi might look much more appealing given its valuation and yield.

The post Woolworths vs JB Hi-Fi: Which ASX shares to buy now? appeared first on The Motley Fool Australia.

Are you tossing up between Super Retail Group Ltd (ASX: SUL) and JB Hi-Fi Ltd (ASX: JBH) shares for your first retail stock? Both are giants on the ASX with well-known brands and loyal shoppers—but their size, business focus, and investment fundamentals are actually more distinct than you might expect. Let's weigh them up side by side so you can make a confident choice as a beginner investor.

The case for Super Retail Group

Super Retail Group is a powerhouse behind some of Australia's favourite specialist retail chains: Supercheap Auto, Rebel, BCF, and Macpac. The group is all about automotive parts, sporting goods, outdoor, and adventure equipment, run both in-store and online across Australia and New Zealand. With a large, established store network (797 stores), Super Retail has carved out a strong niche catering to DIY car lovers, weekend warriors, and active Aussies alike.

Notably, Supercheap Auto delivers the largest chunk of sales, while Rebel drives much of its sporting goods revenue.

A few fundamental highlights stand out for Super Retail Group:

• Attractive dividend yield: The current 5.08% fully franked dividend yield is generous, especially for income-focused beginners—this means more of the dividend is kept in your pocket after tax.
• Lower price-to-earnings (P/E) ratio: Its P/E of 14.13 is lower than JB Hi-Fi, which might hint at better relative value, though comparing directly has its complications.
• 100% franked dividends: All recent and upcoming dividends are fully franked, boosting their after-tax value for Aussie shareholders.

The case for JB Hi-Fi

JB Hi-Fi is synonymous with home entertainment and tech gadgets at competitive prices. With its core stores plus JB Hi-Fi Home, The Good Guys, and newly added e&s stores, the company is a leader in consumer electronics and household appliances. JB Hi-Fi now operates both in Australia and New Zealand, and its online platform keeps growing as shopping habits change.

For those new to investing, JB Hi-Fi brings a few standout traits:

• Larger, more established company: JB Hi-Fi sports a $7.69 billion market cap, more than double Super Retail Group, with a dense store network and massive brand recognition.
• Solid earnings: With a reported earnings per share (EPS) of 4.467, the business is currently pumping out robust profits.
• Consistent, franked dividends: Its 4.82% fully franked dividend yield remains solid for income-seeking investors. Regular and special dividends come through like clockwork.

Valuation comparison

With both companies firmly in the ASX retail heavyweight camp, let's line up their key metrics:

It's worth noting that Super Retail Group's lower P/E ratio could appeal to value-focused investors, and its slightly higher yield offers a bit more on the income front. JB Hi-Fi boasts far stronger EPS and a much bigger overall size.

Recent share price momentum

Comparing recent share price performance up to 6 October 2026:

• Super Retail Group: Closed at $13.03, up 1.8% on the day, but down 16.1% year to date.
• JB Hi-Fi: Closed at $70.29, up 0.63% on the day, but off 23.9% since the start of the year.

So, both have lagged the market recently, but JB Hi-Fi's drop has been steeper.

Which is the better buy?

If I had to choose a retail stock for a beginner investor, my pick would be Super Retail Group. Here's why:

You're getting a business with a slightly cheaper-looking P/E, a higher dividend yield, and 100% franking—great for maximising after-tax returns. While JB Hi-Fi is the much bigger name and has an enviable track record, its shares have fallen further year-to-date, and its yield is a bit lower for incomers. Both have strong brands and essentially zero franking drag, so the choice comes down to value and yield. Based on the available figures, I think Super Retail Group is better positioned to offer steady income with a potentially less demanding valuation for a new investor's first step into retail shares.

The post Super Retail Group vs JB Hi-Fi: Which retail stock is better for beginners? appeared first on The Motley Fool Australia.

One of the best things I like about investing in ASX dividend shares compared to term deposits is that they can deliver both a good payout and dividend growth over time.

I think two of the most underrated businesses for passive income are below.

Argo Investments Ltd (ASX: ARG)

Argo is one of Australia's largest and oldest listed investment companies (LICs). It aims to invest in a diversified portfolio of ASX shares with a low-cost, internally managed business model. It says it invests with a conservative, long-term approach.

It aims to provide shareholders with both fully-franked dividend income and capital growth, and it has been successful in doing so.

Argo has regularly increased its annual payout over the last two decades, though the COVID-19 period did lead to dividend reductions.

In FY26, the business grew its annual dividend per share by 4% to 38.5 cents. That means the business currently has a grossed-up dividend yield of 6%, including franking credits, which is a great starting dividend yield.

Currently, its biggest investments are BHP Group Ltd (ASX: BHP), Macquarie Group Ltd (ASX: MQG), Rio Tinto Ltd (ASX: RIO), Commonwealth Bank of Australia (ASX: CBA), and Wesfarmers Ltd (ASX: WES).

As you can see, the LIC's portfolio is full of ASX blue-chip shares, which can provide it with resilient profits and dividends over the long term.

With a low management expense ratio of 0.14%, I'd be happy to invest in this business, which has been running since 1946.

JB Hi-Fi Ltd (ASX: JBH)

The other ASX share I really want to highlight is JB Hi-Fi, one of Australia's leading retailers of electronics and appliances. It has four businesses – JB Hi-Fi Australia, JB Hi-Fi New Zealand, The Good Guys, and E&S.

One of the main reasons why I think the JB Hi-Fi share price is appealing is that the ASX blue-chip share now offers a very large dividend yield. It's down 40% in the past year, so the dividend yield is much higher.

JB Hi-Fi is projected to pay an annual dividend per share of $3.35 in FY27. That translates into a grossed-up dividend yield of almost 7%, including franking credits. I think that's an impressive yield considering it has increased its payout most years over the past 15 years.

It's true the outlook seems difficult for Australian households, so we'll see how that plays out in the next year or two. But, I think the market is being too pessimistic about the business on a long-term view, particularly considering revenue only fell slightly in Australia at the start of FY27.

If there's a good time to invest in a retailer like JB Hi-Fi, I think it's now, given the much better valuation. I think households will continue to buy electronics in the coming year, making it more defensive than ASX investors are giving it credit for.

The post 2 ASX blue-chip shares offering big dividend yields appeared first on The Motley Fool Australia.

I'm always on the lookout for potential buys that could mean strong returns.

Sometimes that means investing in businesses that consistently grow earnings year after year. But there can also be excellent cyclical opportunities when we buy at the weaker point of the cycle.

High interest rates are a headwind for some areas of the ASX share market, and I think that opens up an opportunity to buy during a temporary dip. Hopefully, interest rates will start coming down again at some point, and that could lead to a significant turnaround of investor confidence.

I'm going to highlight three areas that now look significantly undervalued.

Real estate investment trusts

A lot of real estate investment trusts (REITs) now trade at significant discounts to their underlying net asset value (NAV) or net tangible asset (NTA).

I love being able to buy assets for less than they're worth, and I think, on a long-term basis, that the current unit prices are trading too cheaply.

With how taxes have changed for investing in residential property, I think there could be stronger investor demand for commercial property, which could be supportive for REIT unit prices in the medium term.

I don't necessarily think that every single REIT is a buy, but I'd focus on the ones with positive long-term outlooks and rising rental income.

I think industrial properties and farmland are two areas with promising outlooks. That's why I currently really like Centuria Industrial REIT (ASX: CIP), Dexus Industria REIT (ASX: DXI), Charter Hall Long WALE REIT (ASX: CLW) and Rural Funds Group (ASX: RFF).

Each of those four ASX shares has declined recently, but they're offering strong distribution yields, making them particularly appealing today.

ASX retail shares

The high cost of living and higher interest rates are likely to be a headwind for retail spending, particularly for discretionary retailers.

Retail spending is notoriously cyclical, and it can lead to volatile businesses during an economic cycle.

Even if consumers do reduce spending somewhat, I don't think the current prices reflect the long-term prospects of the retail businesses, largely just the shorter-term pain.

I'd look at names like JB Hi-Fi Ltd (ASX: JBH), Nick Scali Ltd (ASX: NCK), Universal Store Holdings Ltd (ASX: UNI), Lovisa Holdings Ltd (ASX: LOV), Temple & Webster Group Ltd (ASX: TPW), and Wesfarmers Ltd (ASX: WES).

I think they could be great opportunities to buy today for the longer term.

ASX defensive shares

Higher interest rates can make defensive businesses look less appealing because investors can get a solid return from safe investments like savings accounts, term deposits, and quality bonds.

I think ASX defensive shares could be a great investment amid higher interest rates, and lower rates in the future could make the current valuations very attractive.

After recent falls, I think names like Propel Funeral Partners Ltd (ASX: PFP), Transurban Group (ASX: TCL), Telstra Group Ltd (ASX: TLS), Medibank Private Ltd (ASX: MPL), and Sonic Healthcare Ltd (ASX: SHL) look appealing.

These aren't the only ASX shares on my watchlist after the RBA interest rate rise, but they're among my favourite ideas today.

The post Where I'd invest in ASX shares after the recent RBA rate rise appeared first on The Motley Fool Australia.

Among the 11 market sectors, technology is streaking ahead, up 4.4%, while energy is trailing the group, down 1.6%.

Let's look at some new ratings from the experts (courtesy of The Bull).  

BHP Group Ltd (ASX: BHP)

The BHP share price is $60.36, up 0.9% today and up 44% over 12 months. 

Michael Gable from Fairmont Equities has a buy rating on this ASX mining share. 

Gable said: 

I believe commodities markets are in the early stages of a bull run, leaving BHP's share price in a prime position to move higher.

Copper now generates most of BHP's earnings after it produced almost 2 million tonnes in full year 2026. The company should also benefit from constrained global supplies of copper.

Iron ore is also a significant contributor to full year earnings. The company posted an attributable profit of $US9.8 billion in full year 2026, up 9 per cent on the prior corresponding period.

We view any share price dips as a buying opportunity.

JB Hi-Fi Ltd (ASX: JBH) 

The JB Hi-Fi share price is $66.95, up 1% today and down 43% over 12 months. 

Mark Gardner from MPC Markets has a hold rating on this ASX consumer discretionary share. 

Gardner said: 

JB Hi-Fi remains one of the better retailers on the ASX.

The consumer electronics giant delivered record sales of $11.06 billion in full year 2026, up 4.8 per cent on the prior corresponding period. Net profit after tax of $489.9 million was up 6 per cent. The total fully franked dividend of $3.37 was up 22.5 per cent.

A concern is momentum, as total sales growth for JB Hi-Fi Australia was down 0.5 per cent between July 1 and July 31, 2026.

Hold, but keep an eye on the news flow and numbers.

Corporate Travel Management Ltd (ASX: CTD)

The Corporate Travel Management share price is $2.37, up 1.7% today but down more than 80% over 12 months. 

John Athanasiou from Red Leaf Securities has a sell rating on this ASX retail share. 

Athanasiou said: 

CTD reported improved underlying earnings in fiscal year 2026. However, in my view, questions remain around historical customer remediation, governance, financial controls and funding requirements.

In a company update on April 22, 2026, a review had found that UK customers were charged in excess of their contractual entitlement.

On September 1, 2026, the company noted about 78 per cent of customer refunds had been agreed or were nearing finalisation.

In my view, the near term risk-reward equation remains unattractive.  

The post Buy, hold, sell: Corporate Travel Management, JB Hi-Fi, BHP shares appeared first on The Motley Fool Australia.

Canaccord Genuity has just released a research report looking into the sectors which tend to do well, and those that tend to suffer as interest rates increase.

Interest rate increase all but certain

The broking house said in its report that expectations for an interest rate hike had increased sharply over the past few months due to persistently high inflation, exacerbated by rising oil prices due to the conflict in the Middle East.

CG added:

The RBA is now very likely to hike the cash rate by 25bps later this month, and markets are also pricing in one to two further hikes beyond September. While accumulating evidence of a slowing economy may allow the RBA to hold rates after September, the policy outlook is nevertheless materially more restrictive than envisaged this time last year.

The broking house said upward pressure on interest rates, a deteriorating consumer backdrop, a softer housing market and slowing economic growth all presented headwinds for Australian shares from a valuation and earnings perspective.

They added:

These pressures have contributed to a ~5% pullback in the ASX 200 since early August, with outsized declines across the rate-sensitive Retail (-18%) and Real Estate (-13%) sectors, as well as growth sectors such as IT (-14%).

CG said the sectors with the strongest negative correlations with interest rates included real estate, retail and information technology.

CG added:

Recent trading updates have pointed to a softening consumer backdrop, with names such as JB Hi-Fi Ltd (ASX: JBH) reporting negative top-line growth in early FY27. Wesfarmers Ltd (ASX: WES) has also shown a negative correlation with short-term rates, consistent with its exposure to discretionary household spending and its sensitivity to the housing market through its Bunnings franchise.

CG said online classifieds companies such as Seek Ltd (ASX: SEK) and REA Group Ltd (ASX: REA) have in the past shown strong negative correlations with rate increases, which, "partly reflects the degree of cyclicality in their earnings, being tied to job ads and property listings, respectively, as well as the valuation impact of higher long-term yields on growth-orientated companies''.

Infrastructure owners such as Transurban Group Ltd (ASX: TCL) and APA Group Ltd (ASX: APA) were also sensitive to rate increases due to their reliance on debt funding.

Small ray of hope in energy

On the positive side of the ledger, CG said energy stood out as the one sector with a clear positive correlation, "with changes in both short-end rates and longer-term yields over the past three years''.

The post Where to invest as interest rates charge higher appeared first on The Motley Fool Australia.

But you don't have to let it sit idly in the meantime.

Instead, you can invest your superannuation balance and generate a regular source of passive income for when you've stopped working.

But exactly how much passive income could a $800,000 superannuation balance generate each year?

Let's investigate.

How much passive income can I generate from an $800,000 superannuation balance?

To calculate the potential passive income from an $800,000 superannuation balance, you need to multiply your total balance by the dividend yield of your portfolio.

It's a simple calculation, but the problem is that the answer varies depending on the yield of the stocks you pick.

For example, a 3% yielding portfolio needs to be twice the size of one that yields 6% to earn the same passive income.

Which also means that as your dividend yield increases, the passive income you can earn from your $8000,000 superannuation balance climbs higher. 

Here's a breakdown by yield. These figures are based on cash dividends before tax or franking credits. 

What can I earn from a 3% to 4% yielding portfolio?

If your superannuation portfolio has a dividend yield of around 3%, your passive income will be around $24,000 per year, because $800,000 x 3% = $24,000.

If your portfolio yields closer to 4%, your passive income could be closer to $32,000 every year ($800,000 x 4% = $32,000).

Major miners like BHP Group Ltd (ASX: BHP) and Rio Tinto Ltd (ASX: RIO) yield around this level. As do banking giant Commonwealth Bank of Australia (ASX: CBA) and conglomerate Wesfarmers Ltd (ASX: WES).

What passive income can I earn if my superannuation portfolio yields 5% or 6%?

If your superannuation portfolio yields closer to 5%, you could earn $40,000 every year in dividend payments off the same superannuation balance ($800,000 x 5% = $40,000).

At a 6% yield, you could earn an annual passive income closer to $48,000.

Classic dividend stocks like APA Group (ASX: APA), Transurban Group (ASX: TCL), and JB Hi-Fi Ltd (ASX: JBH) all pay around this level.

What about a portfolio yielding much higher, around 7% or 8%?

But if your portfolio has a slightly higher dividend yield of around 7% or 8%, your passive income will go up again to around $56,000 or $64,000, respectively.

Again, it's possible to buy shares around this level, but there are fewer options.

Solvar Ltd (ASX: SVR), Waypoint REIT Ltd (ASX: WPR), and HomeCo Daily Needs REIT (ASX: HDN) all pay around this yield at the time of writing.

Is it possible to invest in ASX shares yielding 10% or higher?

It's possible, but generally, the higher the yield, the higher the volatility and risk associated with the stock. 

If high yield and high risk are what you're after, at a 10% yield, a $800,000 balance could earn around $80,000.

You could invest in ASX-listed stocks such as Tower Ltd (ASX: TWR) or Kina Securities Ltd (ASX: KSL). Another option is to invest your superannuation in a high-yielding exchange-traded fund (ETF), such as the VanEck MSCI International Value ETF (ASX: VLUE) or the VanEck Gold Miners ETF (ASX: GDX). These all yield 10% or more at the time of writing.

The post How much passive income can I earn off an $800,000 superannuation balance? appeared first on The Motley Fool Australia.

With all of the above in mind, it's not surprising that some interest rate-sensitive ASX shares are down (close) to their 52-week lows.

Below are two of my favourites right now at a low point.

Centuria Industrial REIT (ASX: CIP)

Interest rates act like gravity on property prices – when rates go down, interest costs fall, and property values are likely to rise. The reverse is also true. With interest rates anticipated to rise this year, the market has pushed the Centuria Industrial REIT share price down 20% in the past year to a 52-week low.

This business owns a portfolio of industrial properties across Australia. I think it's appealing to be able to buy a slice of so many properties in just a single transaction.

Property values do change over time, and it's hard to know exactly what the ASX share's property portfolio is worth without actually going to sell it, which the business isn't going to do.

However, we can look at the REIT's distribution as a way to see how attractive it is.

The business grew its annual distribution by 3% in FY26 and expects to grow its payout by another 3% to 17.3 cents per unit. That's a forward distribution yield of 6.1%. To me, that's an excellent yield from a business like this.

When rates do eventually come down, I think this valuation could make it seem like a cheap ASX share.

JB Hi-Fi Ltd (ASX: JBH)

JB Hi-Fi is another name that has seen a sell-off. The JB Hi-Fi share price has dropped 44% in the past year, and it's now close to its 52-week low.

Inflation of living costs and higher interest rates are already causing headwinds, and investors are feeling negative. I think it's been heavily oversold.

For July 2026 (the first month of FY27), the business provided a sales update showing total sales dropped 0.5% for JB Hi-Fi Australia and declined 1.7% for The Good Guys. Positively, JB Hi-Fi New Zealand's sales growth was 20.9%.

At this stage, sales are only slightly down in Australia.

I believe JB Hi-Fi Australia is well-placed to serve customers with its scale benefits, very competitively priced products, a wide product range, a productive sales floor, and an expanding network of locations in Australia and New Zealand.  

Using the projection on CommSec, the JB Hi-Fi share price is valued at under 15 times FY27's estimated earnings, with earnings growth projected in FY28 and FY29. That makes it look like a cheap ASX share to me.

The post 2 cheap ASX shares near 52-week lows I'd buy today appeared first on The Motley Fool Australia.

The S&P/ASX 200 Consumer Discretionary Index (ASX: XDJ) is down 0.4% to 3,477 points in late morning trade.

This means the sector has now fallen almost 13% in 2026 and 23% over the past year.

It just shows how quickly sentiment towards retail stocks has changed this year.

And Morgan Stanley still sees plenty to worry about from here.

Why is Morgan Stanley still cautious?

According to The Australian, Morgan Stanley has taken another look at the retail sector following the latest reporting season.

And the broker is still cautious about FY27, even after the falls we've already seen across retail stocks.

Analyst Melinda Baxter and her colleagues said "discretionary stocks have de-rated, but earnings risks remain".

Consumer spending held up better than Morgan Stanley expected through FY26, but the broker still sees some risks ahead for households.

There are a few reasons for that.

The RBA has lifted the cash rate 3 times this year, taking it to 4.35%.

Many mortgage holders are now paying more on their loans than they were at the start of 2026.

Consumer confidence has taken another hit as well.

The Westpac-Melbourne Institute Consumer Sentiment Index fell 5.2% to 84.4 in September.

Westpac said petrol prices had moved back above $2 a litre, while concerns about another RBA rate hike were weighing on households.

The housing market has also started going backwards.

National home prices fell 0.2% in August, marking a fifth consecutive monthly decline from their March peak.

Morgan Stanley thinks all of this could make shoppers a little more careful about where they spend their money.

The broker expects consumers to focus more on value, replacement purchases and promotions as household budgets get tighter.

Which ASX shares does Morgan Stanley prefer?

Morgan Stanley isn't negative on every retailer, but it has still cut price targets across its discretionary retail coverage.

Wesfarmers Ltd (ASX: WES) was one of the few stocks to get some good news.

The Bunnings and Kmart owner was upgraded from underweight to equal-weight, with Morgan Stanley pointing to its more stable margins.

Wesfarmers shares are up 0.39% to $73.15 today.

Harvey Norman Holdings Ltd (ASX: HVN) went the other way.

Morgan Stanley downgraded the stock from equal-weight to underweight, pointing to its franchise model and exposure to the housing market.

Harvey Norman shares are down 0.96% to $4.13 in Friday trade.

The broker also remains cautious on JB Hi-Fi Ltd (ASX: JBH) and Super Retail Group Ltd (ASX: SUL).

Morgan Stanley has kept both stocks at underweight, with the shares trading at $65.77 and $12.37, respectively.

The post ASX retail shares are down 13% in 2026. Here's what Morgan Stanley is worried about appeared first on The Motley Fool Australia.

If you're an Aussie investor eyeing retail stocks for dependable dividends, JB Hi-Fi Ltd (ASX: JBH) and Harvey Norman Holdings Ltd (ASX: HVN) quickly spring to mind. Both are household names selling consumer electronics and home essentials—but they each go about it a little differently, and their financial profiles pack in some key differences too. Comparing JB Hi-Fi vs Harvey Norman shares can help you decide which might suit your portfolio if you're especially focused on dividend yield and income reliability. Let's dig in.

The case for JB Hi-Fi

JB Hi-Fi is a leading specialty retailer focused mainly on consumer electronics, electrical appliances and white goods across Australia and New Zealand. Trading via JB Hi-Fi, JB Hi-Fi Home, The Good Guys and e&s, the company operates stores in shopping centres and standalone sites, with a digital presence that's growing fast.

Notably, JB Hi-Fi offers:

• A market cap of $7.35 billion, making it significantly larger than Harvey Norman.
• A dividend yield of 5.16%, fully franked at 100%, with a history of special dividends.
• An earnings per share (EPS) of $4.467, reflecting robust underlying profitability.

JB Hi-Fi's payout record is impressive—not only has the yield stayed attractive, its dividends have been fully franked for years, regularly delivering both interim and final (plus the occasional special) payments.

The case for Harvey Norman

Harvey Norman is best known as the powerhouse franchisor behind over 270 Harvey Norman, Domayne and Joyce Mayne stores. Its footprint isn't limited to Australia; it stretches into New Zealand, Asia, and Europe. Uniquely, Harvey Norman also owns a hefty portfolio of properties that house many of its franchises, underpinning its balance sheet with hard assets.

Here's where Harvey Norman stands out:

• A higher dividend yield of 7.02%, also fully franked at 100%.
• A lower P/E ratio of 9.75—suggesting shares are cheaper on earnings.
• Earnings yield of 10.26%, outpacing JB Hi-Fi.

While Harvey Norman's market capitalisation ($5.25 billion) is smaller than JB Hi-Fi's, it more than makes up for it with higher yield and an extensive property portfolio, providing another layer of security for income-seeking investors.

Valuation comparison

Harvey Norman sports a much higher yield, a lower price-to-earnings ratio and greater earnings yield, but JB Hi-Fi's earnings and dividends per share are higher, reflecting JB Hi-Fi's higher share price and perhaps greater operational scale.

Recent share price performance

Looking at recent momentum (prices as of mid-September 2026), both stocks have had a rocky year.

JB Hi-Fi shares have fallen -28.6% year to date, currently trading at $67.19.

Harvey Norman fared even worse, down 38.4% year to date, with shares sitting at $4.21.

In the most recent trading days, both have shown mild recoveries, but the medium-term trend has been negative for both companies—not uncommon among big-box retail shares facing tough consumer spending environments.

Which is the better buy?

If I'm choosing purely on dividend yield, Harvey Norman is the standout at 7.02%—well above JB Hi-Fi's 5.16%. Both stocks offer fully franked dividends, which is excellent for Aussie income seekers. Harvey Norman also boasts a lower P/E and higher earnings yield, and its property ownership adds some ballast if retail trading turns rough.

On the other hand, JB Hi-Fi has demonstrated remarkable earnings power per share, a proven record of both ordinary and special dividends, and simply dwarfs Harvey Norman on a per-share dividend basis, even if its headline yield is lower due to a high share price.

Both companies have had a rough run lately, but Harvey Norman's share price has fallen more steeply—potentially making that big yield even more attractive, but also possibly reflecting some market concern.

If I had to place my chips, I'd lean toward Harvey Norman solely for the yield and value metrics, especially if I wanted maximum income right now. But for consistency, payout reliability, and a stronger track record of per-share earnings, my confidence would sway toward JB Hi-Fi over the long term. It's very close—and I couldn't fault an investor for favouring either, but for a high franked yield in today's market, my pick would be Harvey Norman.

The post JB Hi-Fi vs Harvey Norman: Which dividend stock wins? appeared first on The Motley Fool Australia.

The ASX 200 started in red territory this morning and only got worse over the session. By the time trading ended, the index had lost 0.88% of its value and had settled at 8,672.5 points.

This rather terrible Tuesday for Australian investors came after a similarly downbeat night on Wall Street overnight to kick off the American trading week.

The Dow Jones Industrial Average Index (DJX: .DJI) did start strong, but ended up recording a 0.29% loss.

The tech-heavy Nasdaq Composite Index (NASDAQ: .IXIC) fared even worse, dropping 0.56%.

But let's get back to the local markets now and take stock of how the various ASX sectors handled today's difficult trading conditions.

Winners and losers

Despite today's pessimism, we still saw a few sectors make hay.

But first, it was gold shares that copped the worst of it. The All Ordinaries Gold Index (ASX: XGD) ended up crashing 3.08%.

Broader mining stocks had a rough one as well, with the S&P/ASX 200 Materials Index (ASX: XMJ) cratering 2.21%.

Continuing with the commodities theme, energy shares also had a shocker. The S&P/ASX 200 Energy Index (ASX: XEJ) tanked 1.62% this session.

Financial stocks had a day to forget as well, illustrated by the S&P/ASX 200 Financials Index (ASX: XFJ)'s 1.08% plunge.

Real estate investment trusts (REITs) fared a little better. The S&P/ASX 200 A-REIT Index (ASX: XPJ) still lost 0.59%, though.

Industrial shares were right behind that, with the S&P/ASX 200 Industrials Index (ASX: XNJ) sliding 0.43%.

Our last losers this Tuesday were utilities stocks. The S&P/ASX 200 Utilities Index (ASX: XUJ) ended up slipping down 0.12%.

Let's turn to the green sectors now. Leading the winners were healthcare shares, as you can see from the S&P/ASX 200 Healthcare Index (ASX: XHJ)'s 1.5% surge.

Consumer staples stocks held their value, too. The S&P/ASX 200 Consumer Staples Index (ASX: XSJ) jumped 0.88% this session.

Its consumer discretionary counterpart was just behind that, with the S&P/ASX 200 Consumer Discretionary Index (ASX: XDJ) leaping 0.87%.

Communications stocks were spared as well. The S&P/ASX 200 Communication Services Index (ASX: XTJ) advanced 0.32%.

Finally, tech shares managed to stay on the right side of the line, evident by the S&P/ASX 200 Information Technology Index (ASX: XIJ)'s 0.29% bump.

Top 10 ASX 200 shares countdown

Healthcare stock 4DMedical Ltd (ASX: 4DX) was our chart-topper this Tuesday. 4DMedical shares roared 8.72% higher this session to close at $3.74 each.

This came despite no fresh news or announcements from the company today.

Here's how the other top stocks landed their planes:

Our top 10 shares countdown is a recurring end-of-day summary that shows which companies made big moves on the day. Check in at Fool.com.au after the weekday market closes to see which stocks make the countdown.

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

I think the right sort of investment could be one that gives both pleasing passive income and the potential for long-term capital gains.

The two ASX shares I'm going to highlight both have pleasing track records of payouts and underlying earnings growth.  Let's dive in.

Centuria Industrial REIT (ASX: CIP)

This first business is a real estate investment trust (REIT) which is Australia's leading pure play industrial REIT.

Industrial properties in well-located areas are in high demand these days, driven by e-commerce adoption, data centres, increased demand for refrigerated space (for medicine and food), the onshoring of supply chains, and more.

The rising rental potential of the properties is boosting the reported rental income. FY26 saw strong like-for-like net operating income growth of 5.2%, The business also reported a 4% increase of the funds from operations (FFO) – the net rental income – to $114.1 million.

Impressively, the ASX blue-chip share experienced 30% positive re-leasing spreads during FY26. That means its newly signed rental leases are generating 30% more rent than the old lease, so it's seeing significant rental growth.

Considering the business has a weighted average lease expiry (WALE) of around seven years and the portfolio is on average 17% under-rented, I think there could be a solid level of rental growth in the next few years as other leases come up for renewal.

It expects to grow its FFO by up to 5.5% in FY27, and the distribution could grow by another 3% to 17.3 cents per unit. That would translate into a forward dividend yield of 6.1% at the time of writing.

JB Hi-Fi Ltd (ASX: JBH)

In my view, JB Hi-Fi is one of the leading ASX retail shares. The company sells a wide range of electronics, including phones, tablets, computers, wearables, and more.

The JB Hi-Fi share price has fallen by more than 40% in the past year, which has significantly boosted the dividend for prospective investors. It's true that economic conditions are weaker than they were a year ago, but I don't think that justifies such a sharp decline in the valuation.

ASX blue-chip share valuations are meant to take into account the long-term potential, not just shorter-term challenges.

In my view, this decline is an opportunistic time to buy into a business with a strong market position. It has the attributes to excel in all economic conditions – it has a very productive sales floor, low costs, very competitive product prices and so on.

In terms of the potential payout, the projection on Commsec suggests the business could pay an annual dividend of $3.35 in FY27. That translates into a grossed-up dividend yield of 7.4%, including franking credits. The forecasts currently suggest the payout could grow in FY28 and again in FY29, so this could be a great time to buy.

Overall, both ASX blue-chip shares offer compelling dividend yields.

The post 2 ASX blue-chip shares offering big dividend yields appeared first on The Motley Fool Australia.