Meanwhile, brokers have indicated continuing confidence in scores of ASX 200 shares this week.

Let's see a sample.

Santos Ltd (ASX: STO)

The Santos share price is $8.51, down 0.8% today.

Over the past month, this ASX 200 energy share has risen 5%.

Bernstein renewed its buy rating on Santos shares on Monday.

The broker raised its 12-month price target from $8.90 to $10.10.

This suggests a potential 19% upside ahead.

Xero Ltd (ASX: XRO)

The Xero share price is $63.29, down 3.3% today.

This ASX 200 tech share has fallen 24% over the past month.

Citi reiterated its buy call on Xero shares with a price target of $113.60.

This implies potential capital gains of 80% ahead.

Westpac Banking Corp (ASX: WBC)

The Westpac share price is $34.57, down 0.8% today.

Over the past month, this ASX 200 bank share has fallen 0.3%.

UBS reaffirmed its buy rating on Westpac shares with a 12-month target of $45.

This suggests a potential 30% upside ahead.

Rural Funds Group (ASX: RFF)

The Rural Funds share price is $1.95, down 0.5% today.

This ASX 200 agricultural real estate investment trust (REIT) has fallen 11% over the past month.

UBS renewed its buy rating on Rural Funds Group shares with a $2.30 target.

This implies potential capital growth of 19% over the next year.

AMP Ltd (ASX: AMP)

The AMP share price is $2.49, down 0.2% today.

Over the past month, this ASX financial share has risen 6%.

Citi renewed its buy rating on AMP shares with a $2.60 target.

This suggests a potential 4% upside ahead.

Zip Co Ltd (ASX: ZIP)

The Zip share price is $2.21, down 0.5% today.

This ASX 200 financial share has fallen 13% over the past month.

Citi reiterated its buy rating on Zip shares on Monday.

The broker lowered its 12-month target from $3.55 to $3.20 per share.

This implies a potential 45% upside ahead.

Ramelius Resources Ltd (ASX: RMS)

The Ramelius Resources share price is $3.57, up 2.7% today.

Over the past month, this ASX 200 gold share has fallen 1%.

Morgans renewed its buy call on Ramelius Resources shares with a $4.74 target.

This suggests a potential 33% upside ahead.

Morgans said:

RMS is expected to release FY27 guidance and an updated outlook to FY30 in Sep-26, following execution of the EPC contract for the Mt Magnet mill expansion, providing greater clarity on project costs and timing.

The post 7 ASX 200 shares with reaffirmed buy ratings this week appeared first on The Motley Fool Australia.

Let's find out how major S&P/ASX 200 Index (ASX: XJO) shares like AGL Energy Ltd (ASX: AGL), Telstra Group Ltd (ASX: TLS), and Zip Co Ltd (ASX: ZIP) are tracking, and which ones brokers rate as a buy, sell, and hold.

Buy Zip shares

It's been a volatile ride for Zip shares over the past 12 months, with its shares swinging between a low of $1.38 in March and a high of $4.93 in January.

Most recently, the sell-off picked up pace after the company posted its FY26 results late last month. Zip posted a record result, including a huge 57.9% increase in its cash EBTDA, a 24.7% increase in total revenue, and a 45.7% hike in its NPAT for FY26. 

The announcement was initially well received by investors, who rushed to snap up the BNPL provider's shares. But gains were quickly reversed, and the shares are now down around 28% since the announcement.

While the result itself was positive, many investors were underwhelmed by the company's outlook for future growth.

Zip said it is aiming to deliver a group cash EBTDA of $340 million in FY27, up 26% on FY26, and target an operating margin of 20% to 22%. That's much lower than the 57.9% cash EBTDA growth the company experienced in FY26.

But it looks like brokers are confident that the shares can keep climbing higher over the next 12 months. Market Index data shows all brokers have a strong buy rating on the ASX tech shares. And the $3.95 average target price implies an upside of around 79% at the time of writing.

Sell AGL Energy shares

AGL shares rallied higher in mid-August after the ASX energy stock posted an impressive FY26 result. 

The energy supplier announced a 2% increase in both its underlying EBITDA and underlying NPAT for FY26. It also confirmed a 60% increase in its operating free cash flow. The company said that it has grown its customer base, invested $600 million in firming projects, achieved major milestones – including two long-term power purchase agreements – and completed divestment of its stake in Tilt Renewables.

For FY27, AGL is guiding underlying EBITDA between $1.9 to $2.2 billion and underlying NPAT between $470 to $670 million.

But quickly after the share price spike, many investors rushed to take their gains off the table. 

At the time of writing, the shares are down around 5% over the past month, to $8.33 a piece. AGL shares are now down around 11% for the year to date and 4% lower than a year ago.

There hasn't been any price-sensitive news out of AGL since its results announcement, so it looks like the latest sell-off is led by lower investor sentiment.

It looks like there are concerns that the company's earnings recovery is taking longer than expected. 

At the same time, softer power-price expectations, driven by a surge in renewable energy and lower wholesale costs, are expected to put electricity companies like AGL under pressure.

Market Index data shows the majority of brokers have a sell rating on AGL shares. However, after the latest share price decline, the $9.70 target price implies a potential 16% upside.

Hold Telstra shares

Telstra shares have rebounded around 7% from an annual low in late August. The ASX telco shares are now around 0.2% higher year to date but roughly 1% lower than 12 months ago.

The shares tumbled after the telco posted its FY26 results mid-month, with revenue down 0.8% and underlying earnings up 4.4%. However, not long after, investors swooped back in to snap them up at a lower valuation.

As a classic defensive business, Telstra shares are also likely benefiting from a recent flight to security amid renewed geopolitical volatility and inflation concerns.

Brokers aren't convinced that there is much more room for growth going forward. Market Index data shows the majority have a hold rating on Telstra shares. But the $5.01 average target price implies an upside of around 3% at the time of writing.

The post Buy, hold, sell: AGL Energy, Telstra, Zip shares appeared first on The Motley Fool Australia.

After all, one is an S&P/ASX 200 Index (ASX: XJO) buy now, pay later (BNPL) stock, while the other is an ASX 200 coal stock.

One thing they do have in common is their strong outperformance today.

In morning trade on Tuesday, the ASX 200 is down 0.5%.

New Hope shares, on the other hand, are up 2.9%, changing hands for $6.46 each. And Zip shares are soaring 4.3%, trading for $2.19 apiece.

Zip shares look to be getting a boost today after the company announced that, in line with its 20 August announcement, Zip commenced the on-market share buyback of up to $50 million worth of its shares on Monday.

As for New Hope, the coal miner released its FY 2026 results this morning.

New Hope reported a full-year net profit after tax (NPAT) of $161 million. And management declared a fully-franked final dividend of 30 cents per share, up from last year's final passive income payout of 15 cents per share.

That's this week's price action.

Now, if you'd invested $10,000 in both ASX 200 stocks three years ago, here's what you'd have today.

(As for our benchmark, the ASX 200 has gained 19.5% since 15 September 2023.)

New Hope share gains driven by dividends

Three years ago, New Hope shares were trading for $6.22 apiece.

So, for $10,000, you could have bought 1,607 shares in the ASX 200 coal miner.

At today's $6.46, you could sell those same shares for $10,381.

While that's not much of a capital gain over three years, we haven't factored in the New Hope dividends yet.

We can't count the 30-cent-per-share final dividend declared today, as you'd need to own the stock at market close this Friday to be eligible for that passive income.

But if you'd owned the coal miner for the past three years, you would have received the past six fully-franked dividends totalling $1.13 a share.

If we add that back into today's share price, then the accumulated value of the New Hope shares you bought for $10,000 three years ago is now worth $7.59 each.

And those 1,607 shares are worth an accumulated $12,197.

Zip shares strong rebound from post-pandemic beating

Unlike New Hope shares, Zip shares were beaten down badly by 15 September 2023, trading for just 32 cents each.

For $10,000, then, you could have picked up 31,250 shares in the ASX 200 BNPL stock.

Now, Zip doesn't pay any dividends.

But at today's $2.19 share price, those 31,250 shares are worth a cool $68,438.

How about in 2026?

It's a vastly different story in 2026.

Year to date, Zip shares remain down 34% while New Hope shares have surged 61% and paid an interim dividend.

The post $10,000 invested in Zip and New Hope shares 3 years ago is now worth… appeared first on The Motley Fool Australia.

That's because I believe it is worth keeping a close eye on short interest levels as high levels can sometimes be a sign that something isn't quite right with a company.

With that in mind, listed below are the 10 most shorted shares on the ASX this week according to ASIC.

The top 10 most shorted ASX shares

• Lotus Resources Ltd (ASX: LOT) has moved back to the top of the table with short interest of 15.9%, up from 15% last week. Short sellers may still have doubts over the uranium developer's path to production and whether stronger uranium demand will arrive quickly enough to support its plans.
• DroneShield Ltd (ASX: DRO) has short interest of 15.4%, which is broadly unchanged week on week. The counter-drone technology company remains a favourite with short sellers, possibly due to its valuation and uncertainty surrounding the ASIC investigation.
• 4DMedical Ltd (ASX: 4DX) has seen its short interest ease to 12.2%. Its valuation remains very high relative to its current revenue base, which appears to be keeping short sellers interested despite its significant commercial potential.
• Domino's Pizza Enterprises Ltd (ASX: DMP) has short interest of 11.8%, which is down again week on week. Short sellers may still need convincing that its restructuring efforts can deliver the earnings recovery investors are hoping for.
• Treasury Wine Estates Ltd (ASX: TWE) has seen its short interest ease slightly to 11.7%. Weakness in luxury wine demand and uncertainty around the pace of improvement in the Americas could be keeping short sellers interested.
• Zip Co Ltd (ASX: ZIP) has seen its short interest rise to 11.6%. The buy now pay later company's strong recovery may have prompted some short sellers to question whether its valuation now leaves enough room for disappointment.
• PLS Group Ltd (ASX: PLS) has 11.2% of its shares held short, which is up slightly week on week. Short sellers may be betting that the lithium market remains difficult for longer, delaying a meaningful recovery in margins and cash flow.
• Flight Centre Travel Group Ltd (ASX: FLT) has seen its short interest rise to 11.1%. This may reflect concerns over the strength of consumer travel spending and how quickly the company can improve margins.
• Paladin Energy Ltd (ASX: PDN) has short interest of 11%, which is up from 10.7% last week. Short sellers may remain cautious over production expectations and whether the uranium price can stay strong enough to support the current outlook.
• IperionX Ltd (ASX: IPX) has entered the top ten with short interest of 10.6%. Short sellers may be questioning the company's valuation and the execution required as it works to scale up its US titanium operations.

The post These are the 10 most shorted ASX shares appeared first on The Motley Fool Australia.

Today's sell-off follows a long run of declines, reversing any gains made during a brief recovery in June and July. The shares are now down 11% this week, and have shed just over 22% over the past month alone.

The shares are now also around 52% lower than 12 months ago.

What is going on with Zip shares this week?

There hasn't been any price-sensitive news out of Zip this week to explain the latest sell-off.

The buy now, pay later (BNPL) provider's shares have been very volatile throughout 2026 so far, swinging anywhere between $3.56 in January, and a low of $1.38 in March. 

Most recently, the sell-off picked up pace after the company posted its FY26 results on the 20th of August. 

Zip posted a record result, including a huge 57.9% increase in its cash EBTDA, a 24.7% increase in total revenue, and a 45.7% hike in its NPAT for FY26.

The company also said it expects its cash EBTDA to climb even higher in FY27, by around 26% thanks to strong growth and greater scale across the business.

The announcement was initially well received by investors, who rushed to snap up the BNPL provider's shares. But gains were quickly reversed and the shares are now down around 28% since the announcement.

While the result itself was positive, it looks like many investors were underwhelmed by the company's expectations for future growth.

Zip said it is aiming to deliver a group cash EBTDA of $340 million in FY27, up 26% on FY26, and target an operating margin of 20% to 22%. That's much lower than the 57.9% cash EBTDA growth the company experienced in FY26.

The news also came against a backdrop of volatile markets and weak investor sentiment, adding further pressure to the share price.

Now the question is, is the latest sell-off a buying opportunity to buy the ASX tech shares for cheap, or is there more downside coming?

Here's what the experts think.

What's ahead for the ASX tech stock?

Analysts are incredibly bullish on Zip shares, with widespread anticipation that we'll see a significant upside over the next 12 months.

Market Index data shows all brokers agree on a strong buy rating, and the $3.95 target price implies around a 78% upside, at the time of writing.

TradingView data shows something similar. All 12 analysts have a buy/strong buy rating on the shares. The average $4.56 target price implies a potential 106% upside ahead, at the time of writing. Although some are confident that Zip shares can climb another 171% to $6.03 over the next 12 months.

UBS recently confirmed its buy rating and $4.70 target price on Zip shares. The broker said that the outlook for the current year was better than expected, providing comfort around the defensive qualities of the buy now, pay later business model through slowing economic times.

The team at Macquarie also agrees. The broker has a buy rating and $3.50 target price on the shares. Macquarie said "Zip's outlook remains attractive as management executes the market opportunity in the US, supported by performance in AU".

The post Zip shares crash another 11% this week: What is going on? appeared first on The Motley Fool Australia.

Earnings season has ended and analysts have refreshed their price targets across hundreds of companies.

The three below have all fallen heavily over the past year.

All three are still growing earnings, which is what makes the gap interesting.

Why these ASX growth shares were sold off

The cause is the same in each case.

Interest rate expectations have moved sharply, with all four major banks now forecasting another rise this year.

Higher rates hit companies valued on distant earnings hardest, and they hit companies funding growth with debt harder still.

None of these three fell because of a downgrade.

Each of them reported growth in FY26.

1. NEXTDC Ltd (ASX: NXT)

NEXTDC closed Tuesday at $12.52 after falling 14% in a month.

UBS has a buy rating with a $23.45 target, implying 88% upside.

The FY26 result was a record.

Net revenue rose 16% to $405.0 million and underlying EBITDA rose 15% to $248.8 million, both above guidance.

Contracted utilisation surged 202% to 740.1 megawatts and statutory net profit turned positive at $82.1 million.

FY27 guidance points to net revenue of $615 million to $640 million, growth above 50%.

The catch is the capital expenditure required to deliver it, guided at $5.25 billion to $5.75 billion.

2. Nine Entertainment Co Holdings Ltd (ASX: NEC)

Nine Entertainment is the cheapest and most contrarian of the three.

Shares closed at 86 cents, down 48.19% over twelve months and barely above a 52-week low of 83.5 cents.

Morgan Stanley has a buy rating with a $1.40 target, implying 63% upside.

FY26 revenue rose 3% to $2.19 billion on a continuing business basis and group EBITDA jumped 17% to $379 million.

Net profit after tax increased 7% to $142.4 million and earnings per share before amortisation rose 11% to 9.3 cents.

The QMS Outdoor acquisition contributed $55 million of EBITDA in its first three months.

Similarly, digital subscription revenue grew 12%, and Nine has signed content licensing deals for AI applications including one with Microsoft.

Chief executive Matt Stanton explained the reshaping of the portfolio.

Over the past 12 months, we have made material changes to our business portfolio, focusing on growth and digital assets whilst reducing our exposure to structurally challenged and smaller assets. These transactions add to our operational scale and create a higher growth and more resilient Nine, better positioned to create long term sustainable value for our shareholders.

The final dividend of 3.0 cents is unfranked, and management expects that to continue.

3. Zip Co Ltd (ASX: ZIP)

Zip has the most bullish coverage on the ASX.

All twelve analysts covering the company rate it a buy or strong buy, with an average target of $4.56 against a $2.31 share price.

That implies roughly 95% upside, with the most optimistic target at $6.03.

FY26 cash EBTDA rose 57.9% to $268.9 million and revenue climbed 24.7% to $1,336.1 million.

Net profit after tax increased 45.7% to $116.4 million and the operating margin expanded from 15.8% to 20.0%.

Management has guided FY27 cash EBTDA to $340 million, up around 26%.

The United States now produces about two-thirds of revenue, and that is where the growth is coming from.

Foolish takeaway

Broker targets are opinions, not forecasts, and a 90% implied upside usually means high uncertainty rather than free money.

What these three ASX growth shares share is a market that has repriced their respective multiples.

I would rather buy a company growing revenue at 16% to 25% after a 50% fall than chase one already compounding.

The post 3 ASX growth shares experts think could double appeared first on The Motley Fool Australia.

Every broker covering the company still rates it a buy.

What's more, the average price target implies the shares roughly doubling from here.

Why brokers are so bullish on Zip shares

Zip Co Ltd (ASX: ZIP) closed Tuesday at $2.31, down 2.94% on the day.

Shares have fallen 49.12% over twelve months and 25.84% year to date. The 52-week range runs from $1.37 to $4.93.

All twelve analysts covering the company hold a buy or strong buy rating.

The average target of $4.56 implies around 95% upside, and the most bullish sits at $6.03.

UBS has reiterated a buy rating with a $4.70 target, pointing to the defensive qualities of the buy now, pay later model in weaker economic conditions.

The FY26 result behind the call

The numbers are part of the reason the brokers have not capitulated.

Zip delivered record cash EBTDA of $268.9 million in FY26, up 57.9%.

Total revenue rose 24.7% to $1,336.1 million and total transaction value climbed 27.2% to $16.7 billion.

Net profit after tax increased 45.7% to $116.4 million.

The margin story is arguably more important than the growth.

Operating margin expanded from 15.8% to 20.0% in a single year.

The company also completed $150 million of buybacks and announced a further $50 million for FY27, with available cash and liquidity of $246.5 million.

Group chief executive Cynthia Scott put the result in context:

Consistent execution has built the platform to deliver our next phase of growth and innovation. In FY26, we exceeded our targets with record cash earnings of $268.9m, up 57.9%, underpinned by material cash earnings growth in both markets. We maintained strong unit economics, expanded operating leverage and reinforced the value of our differentiated business model.

The United States is the whole story

Importantly for Zip, the American business now generates roughly two-thirds of group revenue.

Transaction volume and revenue both grew more than 42% there in local currency terms.

Active United States customers rose 9.3% to 4.65 million.

The Australian and New Zealand business is going the other way, with customer numbers down 8% to 1.88 million.

Management is winding down the New Zealand operation entirely to concentrate on Australia.

Guidance for FY27 calls for group cash EBTDA of $340 million, up around 26%.

The operating margin target is 20% to 22% and United States transaction volume is expected to grow more than 30%.

Zip is also weighing a share consolidation and a possible dual listing on the Nasdaq.

What has gone wrong for Zip shares

The share price fall has very little to do with the accounts.

Three things have worked against it at once.

The first is a broad sell-off in technology and high-multiple names.

The second is competition, with the buy now, pay later market crowded and margins under permanent scrutiny.

The third, and perhaps most important, is interest rates.

Zip lends money to consumers, which makes it geared to household health in both directions.

Consumer sentiment fell 5.2% in September to 84.4, with nearly two-thirds of consumers expecting mortgage rates to rise within a year.

All four major banks now forecast another rate rise before the end of 2026.

Foolish takeaway

The bull case for Zip shares is not overly complicated.

Earnings are growing fast, margins are expanding and the United States business is scaling.

The bear case is that none of that has been tested through a true consumer downturn. Only time will tell for Zip shares.

The post Can Zip shares recover? Here's what the experts have to say appeared first on The Motley Fool Australia.

After trading between $1.38 and $4.93 over the past 12 months, the ASX buy now, pay later stock faces several potential catalysts, including continued growth in its lucrative US market.

A broader technology sell-off, concerns about competition and slowing growth, geopolitical uncertainty and higher-for-longer interest rates have all weighed on investor sentiment.

But with Zip's underlying financial performance strengthening, brokers remain remarkably bullish.

Brokers see big upside for Zip shares

TradingView data shows all 12 analysts covering Zip shares currently have either a buy or strong buy rating. The average broker price target of $4.56 implies potential upside of around 95% from the current share price of $2.35 at the time of writing.

The most bullish forecast is even more eye-catching, with one broker tipping Zip shares to reach $6.03. This points to a potential 157% return over the next 12 months.

UBS recently reiterated its buy rating and $4.70 price target, implying roughly 100% upside from the current share price. The broker said Zip's current-year outlook was better than expected, providing greater confidence in the defensive qualities of its BNPL model during weaker economic conditions.

Why could Zip shares rebound?

Zip's recent financial performance provides some substance behind the bullish broker forecasts for Zip shares. Its latest FY26 results showed cash EBTDA jumping 57.9%, while revenue rose 24.7% and NPAT increased 45.7%.

Management expects that momentum to continue, forecasting cash EBTDA growth of around 26% in FY27 as the business benefits from further growth and scale.

Perhaps the most important part of the story is where that growth is coming from. Zip has spent the past few years reshaping the business around product development, profitability and international expansion, with the US now firmly at the centre of its strategy.

The US accounted for roughly two-thirds of Zip's revenue in FY26. Revenue from the market climbed 37.3% in Australian dollar terms and 44.3% in US dollar terms, comfortably ahead of the 4.6% growth recorded across ANZ.

Customer numbers tell a similar story. Active US customers increased 9.3% to 4.65 million, while ANZ customers declined 8% to 1.88 million. Zip expects US total transaction value to grow by more than 30% in FY27.

That makes the US expansion arguably the biggest potential driver of Zip's earnings and valuation from here.

Could a Nasdaq listing provide another catalyst?

Zip is also pursuing a dual listing on the Nasdaq. A US listing could increase the company's visibility among American investors and potentially support its ambitions in the world's largest BNPL market.

For investors in Zip shares, that creates an intriguing setup: a share price that has fallen sharply, accelerating earnings growth, strong broker support and a potentially significant US opportunity.

Of course, the risks haven't disappeared. Zip remains exposed to consumer spending, competition, regulation and interest rates, while its aggressive US expansion will need to keep delivering.

The post Experts tip battered Zip shares to deliver over 90% returns appeared first on The Motley Fool Australia.

That's because I believe it is worth keeping a close eye on short interest levels as high levels can sometimes be a sign that something isn't quite right with a company.

With that in mind, listed below are the 10 most shorted shares on the ASX this week according to ASIC.

The top 10 most shorted ASX shares

DroneShield Ltd (ASX: DRO) remains at the top of the table with short interest of 15.4%, which is up week on week. The counter-drone technology company continues to attract plenty of attention from short sellers, possibly due to its valuation and the ongoing ASIC investigation.

Lotus Resources Ltd (ASX: LOT) has seen its short interest jump to 15%. Short sellers may still have concerns over the uranium developer's funding requirements and the execution needed to deliver its growth plans.

4DMedical Ltd (ASX: 4DX) has short interest of 12.3%, which is down slightly week on week. The medical imaging technology company remains heavily shorted as investors weigh its significant growth potential against a very high valuation.

Domino's Pizza Enterprises Ltd (ASX: DMP) has seen its short interest ease to 12%. Short sellers may be unconvinced that the pizza chain operator's restructuring and store closures will be enough to restore strong earnings growth.

Treasury Wine Estates Ltd (ASX: TWE) has short interest of 11.8%, which is down slightly week on week. Weakness in parts of the global wine market and uncertainty around the company's recovery continue to give short sellers something to focus on.

PLS Group Ltd (ASX: PLS) has 11.1% of its shares held short, which is broadly unchanged since last week. Short sellers may be expecting lithium prices to be under pressure, which would weigh on margins.

Zip Co Ltd (ASX: ZIP) has seen its short interest rise to 11.1%. The buy now pay later company's strong share price recovery may have encouraged some investors to bet that expectations are becoming too optimistic.

Elders Ltd (ASX: ELD) has returned to the top ten with short interest of 10.9%. Short sellers may have concerns over rural spending conditions and the outlook for earnings growth across the agribusiness.

Paladin Energy Ltd (ASX: PDN) has seen its short interest fall to 10.7%. Despite this, short sellers may still believe expectations for uranium prices and future production are running ahead of reality.

Flight Centre Travel Group Ltd (ASX: FLT) has seen its short interest ease again to 10.6%. Short sellers may remain cautious on the travel agent due to margin pressure, consumer spending conditions, and disruption to international travel.

The post These are the 10 most shorted ASX shares appeared first on The Motley Fool Australia.

Meanwhile, the benchmark S&P/ASX 200 Index (ASX: XJO) sank 0.95% to finish at 9,005.9 points.

It's likely that investors buying the dip on bank shares were responsible for last week's sector rebound after a difficult August.

Three of the four major banks were smashed last month after all of them reported significantly lower mortgage applications since May.

That followed the Federal Government announcing changes to capital gains tax (CGT) and negative gearing in the FY27 Budget.

James Gruber, CommSec Equity Market Strategist, said the financial sector was the worst performer of the August earnings season. 

ASX 200 financial shares lost 6.13% of their value over the month.

That performance left investors feeling wary of how the housing market downturn now underway may impact the banks' profitability.

Then last week, the Australian Bureau of Statistics (ABS) released economic news that changed the outlook for the banks.

Resilient economy benefits bank stocks

The ABS revealed that gross domestic product (GDP) rose 0.4% in the June quarter and 2.1% over 12 months.

That was stronger than consensus expectations of 0.3% growth in June and 1.8% annual growth, and ahead of the Reserve Bank's forecast of 1.9% annual growth.

The data raised the chances of another interest rate rise as early as next month, and higher rates can be supportive for bank earnings.

If the banks' lending rates stay above deposit rates, which is the norm, then a higher cash rate can boost their net interest margins (NIMs).

A stronger economy can also be positive for banks because it typically means stable employment and resilient household spending.

That means people can keep up their repayments on their home loans and other debts with the banks.

Expectations of another rate hike pushed the 3-year government bond yield to 4.82%, and 10-year yields rose to levels not seen since 2011.

This is why the broader ASX 200 had its worst day in three months on the day the GDP data was released, and why it finished the week in the red.

Higher bond yields aren't great for shares.

When investors can get a pretty high and virtually 'risk-free' return from defensive assets like cash or bonds, they can go 'risk-off'.

That means they are less inclined to invest in shares, which carry a higher risk of capital losses.

Or they might rotate out of growth shares into dividend stocks or blue-chips with reliable earnings (such as the banks!)

This may have also supported ASX 200 bank share prices last week.

As for the rest of the market, 6 of the 11 sectors finished the week in the red.

Let's recap.

Financial shares led the ASX sectors last week

Commonwealth Bank of Australia (ASX: CBA) shares rose 2.02% to $160.42, recovering some of their 9.9% tumble during August.

Westpac Banking Corp (ASX: WBC) shares lifted 3.13% to $34.96, taking back some of their 8.8% decline last month.

National Australia Bank Ltd (ASX: NAB) shares increased 2.51% to $39.25, pulling back some of their 6.5% loss during earning season.

Australia and New Zealand Banking Group Ltd (ASX: ANZ) shares closed 3.32% higher at $37.95.

The ANZ share price fell just 0.3% last month as investors were impressed with the fruits of a continued reset under CEO Nuno Matos.

Macquarie Group Ltd (ASX: MQG) shares lifted 0.04% to $251.87, recovering a little of their 1% decline last month.

Bendigo and Adelaide Bank Ltd (ASX: BEN) shares rose 0.47% to $10.63, taking back some of their 6.4% fall in August.

Bank of Queensland Ltd (ASX: BOQ) shares lifted 3.89% to $6.68, wiping out their 1.66% dip last month.

Among the investment companies and wealth managers, Magellan Financial Group Ltd (ASX: MFG) shares fell 3.43% to $8.74.

Washington H. Soul Pattinson and Co Ltd (ASX: SOL) shares fell 0.25% to $44.22.

Among the financial services providers, AMP Ltd (ASX: AMP) shares jumped 5.08% to $2.48.

Hub24 Ltd (ASX: HUB) shares fell 3.58% to $73.81 and Netwealth Group Ltd (ASX: NWL) dropped 5.03% to $20.37.

Buy now, pay later company Zip Co Ltd (ASX: ZIP) fell 3.94% to $2.44 per share.

Among the ASX 200 insurance shares, Insurance Australia Group Ltd (ASX: IAG) rose 2.55% to $8.05.

The Suncorp Group Ltd (ASX: SUN) share price leapt 5.04% to $19.37.

Financial companies are among 40 ASX shares with ex-dividend dates next week.

ASX 200 market sector snapshot

Here's how the 11 market sectors stacked up last week, according to CommSec data.

Over the five trading days:

The post ASX 200 bank shares led a financial sector rebound last week appeared first on The Motley Fool Australia.

CommSec recorded 11.5% growth in active customers over FY26, with trading volumes up 27%, and traded value up 33%.

Millennials were the dominant investor group in FY26, representing 37% of active trading accounts.

Young investors were more proactive, with the total trade value among clients under 40 years increasing 55% in FY26.

By comparison, trade value among customers aged over 40 years rose 30%.

Gen Z (born 1997-2012) accounts for just 1.6% of the wealth held by CommSec investors, but they were the most active traders.

Gen Z represented 19% of active market participants in FY26.

CommSec said Gen Z was turning to ASX shares to build wealth because they were priced out of Australia's property market:

Where 40 years ago, Baby Boomers and Gen Xers could buy a typical first home in Sydney or Melbourne for around 3-4 times the average salary of the time, Gen Zers face a price ratio of up to 14 times their average salary, following several decades of property values far outpacing average wage growth.

Consequently, investing in the stock market to generate capital has become an appealing alternative to property for many Gen Zers…

First-time ASX shares investors

First-time investor activity in FY26 was strongest amongst clients aged under 40 years at 66%, up from 63% in FY24.

Female investors accounted for 42% of first-time investors, up from 36% two years ago.

Overall, 66% of active investors on CommSec in FY26 were men and 34% were women.

Gillian Bowen, Head of Media and Markets at CommSec, said:

Australians are investing in greater numbers than ever before, but the path they're taking increasingly reflects their life stage, priorities and financial circumstances.

Younger investors are entering the market earlier and are highly engaged, while older generations continue to hold significant pools of wealth built over decades.

Young Australians' portfolios were primarily full of ASX shares.

The most traded ASX shares among Millennials were: Droneshield Ltd (ASX: DRO), PLS Group Ltd (ASX: PLS), Zip Co Ltd (ASX: ZIP), and CSL Ltd (ASX: CSL).

The most traded among Gen Z were: Droneshield, PLS Group, Zip, and Commonwealth Bank of Australia (ASX: CBA) shares.

While younger investors retained the home bias of previous generations, they were increasingly engaged in overseas markets.

Younger investors more open to international shares

Younger Australians were increasingly focusing on international shares, the research showed.

About 10% of Gen X (born 1965-1980), Millennials (1981-1996), and Gen Z portfolios on CommSec contained international shares.

That compared to 5% for Baby Boomer (born 1946-1964) portfolios.

CommSec said global tech shares featured prominently among the most traded shares for all investor groups in FY26.

The most traded US stocks among Millennials were: Tesla, Nvidia, Super Micro Computer, and Space X.

The most traded among Gen Z were: Tesla, Nvidia, ProShares UltraPro QQQ, and Direxion Daily TSLA Bull 2X ETF.

More than two-thirds of Gen Z investors held exchange-traded funds (ETFs), the largest proportion of any generation.  

The most traded ASX ETFs among Gen Z investors were: BetaShares Nasdaq 100 ETF (ASX: NDQ), iShares Global 100 ETF (ASX: IOO), iShares S&P 500 ETF (ASX: IVV), and Vanguard Australian Shares Index ETF (ASX: VAS).

Average value of portfolios

The average Gen Z shares portfolio on CommSec was worth about $20,000.

Millennials' portfolios were worth an average $66,000.

The average Gen X shares portfolio was worth $233,000.

Baby boomers held the most wealth, with the average portfolio worth $541,000.

The average number of shares held within a portfolio was surprisingly small.

Gen Z portfolios had, on average, three stocks or ETFs.

Baby boomers had an average of eight shares in their portfolios.

The post ASX shares investors are getting younger and trading more often: CBA report appeared first on The Motley Fool Australia.

And that volatility was on clear display in August.

Zip shares closed on 31 July trading for $2.55. When the closing bell rang on 31 August, shares were changing hands for $2.50 apiece.

This put the share price down 2.0% over the month just past, underperforming the 1.1% gains posted by the ASX 200.

Now, I know a 2% monthly decline doesn't sound particularly volatile.

But here's the thing.

On 20 August, Zip stock rocketed 18.2%.

The following day, shares crashed 15.7% as profit-taking looks to have taken the lead.

It's enough to have you reaching for your Dramamine.

Here's what's been happening.

What's been sending Zip shares on a wild ride?

August saw a few headwinds pick up for the ASX 200 BNPL stock.

Among these were rising expectations that inflation in its two dominant markets, Australia and the United States, may take longer than hoped to bring down within those countries' central bank target ranges.

That's led to higher prospects of interest rate hikes from both the US Fed and the RBA. And BNPL stocks like Zip shares have proven highly sensitive to interest rate moves.

Investors also have high growth expectations for the company. Which Zip delivered on when it reported its FY 2026 results on 20 August.

What did Zip report for FY 2026?

If you've been paying attention, you'll have noted that 20 August was the day that Zip shares surged 18.2%, closing the day at $3.05 apiece.

Investors were overheating their buy buttons after the company achieved some record-breaking results.

Over the 12 months, Zip increased its active customers by 3.7% from FY 2025, up to 6.5 million. And the company saw a 27.2% lift in its total transaction volume (TTV) to $16.7 billion, driving a 24.7% increase in full-year revenue to $1.34 billion.

Zip also achieved record cash earnings before taxes, depreciation and amortisation (EBTDA) of $268.9 million, up 57.9% year on year.

And with the BNPL stock's operating margin increasing by 4.2% to 20% in FY 2026, Zip posted a net profit after tax (NPAT) of $116.4 million, up 45.7% from the prior year.

The company also expects to deliver more earnings growth in the current financial year, targeting cash EBTDA of $340 million in FY 2027, representing a 26% increase from FY 2026.

Commenting on the results that sent Zip shares flying on the day, CEO Cynthia Scott said:

Our focus on exceptional customer experiences is translating into stronger engagement. In the US, we achieved more than 40% growth in both TTV and revenue for a second consecutive year while adding new customers at scale.

In ANZ, we returned to revenue and Australian receivables growth, led by the continued success of our Zip Plus product.

The post Why Zip shares took investors on a wild ride in August appeared first on The Motley Fool Australia.

I think both still have substantial long-term opportunities ahead, although investors need to be comfortable with some uncertainty along the way.

Zip Co Ltd (ASX: ZIP)

Zip has become a much stronger business than the company investors may remember from the buy now, pay later boom.

The company finished FY26 with 6.5 million active customers and 97,400 merchants globally. Total transaction volume increased 27% to $16.7 billion, while cash EBTDA jumped 58% to $268.9 million.

For me, the important development is that rapid growth is increasingly being accompanied by stronger profitability.

The US opportunity remains especially exciting to me. Zip has been expanding beyond occasional discretionary purchases into areas such as health, education, transport, groceries, and other everyday spending. Customers are also using the service more frequently, while partnerships with businesses such as Stripe can put Zip in front of many more merchants.

This creates the possibility of Zip becoming a much more regular part of how customers manage short-term cash flow.

Credit quality will always be important, and consumer lending brings risks if economic conditions weaken. But Zip's FY26 net bad debts remained well controlled at 1.8% of transaction volume.

I think the combination of US growth, improving profitability, and deeper customer engagement makes Zip an interesting September buy.

WiseTech Global Ltd (ASX: WTC)

I would also buy WiseTech shares in September.

There is still uncertainty around the integration of e2open, its newer commercial model, leadership changes, and how quickly some of its growth initiatives will deliver.

But I find its position within global logistics difficult to ignore. WiseTech's software is used by more than 20,000 logistics companies across 193 countries. This includes 47 of the world's top 50 third-party logistics providers and 24 of the 25 largest global freight forwarders.

I think that is an extraordinary position in an industry where moving goods internationally requires companies to handle customs, compliance, transport, warehousing, documentation, and countless other processes.

CargoWise sits deep inside those operations.

WiseTech also ended FY26 with 61 large global freight forwarder rollouts, while several contracted customers still have substantial volumes waiting to go live. I think that gives the company a strong foundation for further growth.

The e2open integration could expand WiseTech's reach across the wider supply chain, while AI offers opportunities to automate more of the work its customers currently perform manually.

There is plenty to prove, but I am willing to accept some uncertainty when the underlying competitive position is this strong.

Foolish takeaway

Both ASX shares require investors to look beyond the next quarter.

Zip is showing that its US expansion can produce strong growth alongside improving economics, while WiseTech remains deeply embedded in an industry where its software can become increasingly valuable.

For investors prepared to tolerate some bumps, I think September could be a good time to take a closer look at both.

The post Why I think Zip and WiseTech shares could be buys in September appeared first on The Motley Fool Australia.

Both Mesoblast Ltd (ASX: MSB) and Zip Co Ltd (ASX: ZIP) have faced different challenges, but analysts believe their growth prospects could translate into substantial share price gains.

Mesoblast: strong sales growth and a well-funded outlook

The clinical-stage biotech has had a sluggish start to 2026. Mesoblast shares currently trade at $2.34, down 14% year to date but still 10% higher than they were 12 months ago.

The weakness appears to reflect greater investor caution around clinical timelines, alongside some profit-taking following last year's strong rally.

Mesoblast develops and commercialises allogeneic cellular medicines for complex diseases. Some of its products are already in use, while other cell therapies are progressing through late-stage clinical trials.

Its Ryoncil product is gaining traction, while the company remains well funded. Brokers are also optimistic that sales can continue growing strongly in FY27.

TradingView data shows all five analysts covering the ASX shares rate them a strong buy. Their average price target of $4.08 implies potential upside of approximately 75%.

Bell Potter recently said Mesoblast's latest results were broadly in line with expectations. The broker sees continued double-digit growth from Ryoncil, alongside major potential catalysts from Rexlemestrocel in heart failure and chronic lower back pain.

Bell Potter has a buy rating and a $4.45 price target, implying around 90% potential upside.

Zip: US as main attraction

Zip is a fintech providing buy now, pay later and digital payment services to consumers and merchants. Its rapidly expanding US business is the key attraction.

The US accounted for around two-thirds of Zip's revenue in FY26, with total revenue increasing 24.7%. US revenue surged 37.3% in Australian dollar terms and 44.3% in US dollar terms, compared with just 4.6% growth in ANZ.

The US is also driving customer growth. Active US customers rose 9.3% to 4.65 million, while ANZ customers fell 8% to 1.88 million. For FY27, Zip expects US total transaction value to increase by more than 30%.

Importantly, profitability is growing faster than revenue. Cash gross profit increased 26.2% to $642.3 million, while cash operating profit jumped 57.9% to $268.9 million.

Analysts are particularly bullish. TradingView data shows all 13 analysts rate Zip a buy or strong buy. The average $4.52 price target suggests around 72% upside, while the most bullish target of $6.03 implies potential gains of roughly 130%.

UBS recently maintained its buy rating and $4.70 target, implying around 79% upside. Macquarie also has a buy rating, although its $3.50 target is considerably more conservative.

For investors hunting for ASX growth shares, both companies have significant potential, but that potential comes with materially higher risk than established blue-chip stocks.

The post Experts tip these $3 billion ASX shares to deliver over 75% returns appeared first on The Motley Fool Australia.

The buy now, pay later (BNPL) provider's shares have swung wildly anywhere between $1.38 and $4.93 per share thanks to strong headwinds and fluctuating investor sentiment.

The ASX tech stock has faced several major headwinds over the past 12 months. 

The falling share price is mostly the result of a sector-wide sell-off of technology stocks. Investors were spooked by concerns about rising competition, slowing growth, and margin compression, and it caused a sharp sell-off through late-2025 and into early-2026.

This was exacerbated further by rising concerns around conflict in the Middle East. In early-2026, many investors rotated away from high-growth technology stocks and towards more stable assets.

A sharp increase in the value of some ASX tech shares in 2025, including Zip, also sparked concerns that tech companies were overvalued and overdue a price correction. 

Where are Zip shares trading now?

At the time of writing, Zip shares are up around 1% and changing hands at $2.53 a piece.

The increase means the shares are now around 24% lower for the year to date and down 41% from 12 months ago.

Are Zip shares too cheap to pass up?

Analysts are incredibly bullish on Zip shares, with widespread anticipation that we'll see a significant upside over the next 12 months.

Market Index data shows all brokers agree on a strong buy rating, and the $3.95 target price implies around a 58% upside, at the time of writing.

TradingView data shows something similar. All 13 analysts have a buy/strong buy rating on the shares. The average $4.52 target price implies a potential 81% upside ahead, at the time of writing. Although some are confident that Zip shares can climb another 141% to $6.03 over the next 12 months.

UBS recently confirmed its buy rating and $4.70 target price on Zip shares. The broker said that the outlook for the current year was better than expected, providing comfort around the defensive qualities of the buy now, pay later business model through slowing economic times.

The team at Macquarie also agrees. The broker has a buy rating and $3.50 target price on the shares. Macquarie said "Zip's outlook remains attractive as management executes the market opportunity in the US, supported by performance in AU".

What is expected to drive the ASX tech shares higher this year?

Zip's financial results have been strong through the past few quarters. Its latest full-year FY26 results announcement last month shows that growth has continued accelerating. The fintech business posted a huge 57.9% increase in its cash EBTDA. It also reported a 24.7% increase in total revenue, and a 45.7% hike in its NPAT for FY26.

The company also said it expects its cash EBTDA to climb even higher in FY27, by around 26% thanks to strong growth and greater scale across the business.

Zip has undergone a major reset over the past few years. It is now heavily concentrated on product growth and global expansion, especially in the US. It looks like this reset is finally translating to improved revenue and a boost in investor confidence.

Zip is currently pursuing a dual sharemarket listing on the Nasdaq in the US in the hope that it could help drive an even opportunity for business expansion in the area. 

The post Is it time to get greedy with Zip shares? appeared first on The Motley Fool Australia.

ASIC publishes an aggregated short position report covering every listed security.

It is one a genuinely useful public windows into what professional money is betting against.

This week's table is led by DroneShield Ltd (ASX: DRO) at 14.9% and Lotus Resources Ltd (ASX: LOT) at 13.6%.

Why these ASX shares are being shorted

Short interest above 10% is unusual.

It generally means a fund has done the work, taken a view, and is willing to pay to hold the position.

The list also includes 4DMedical Ltd (ASX: 4DX) at 12.4%, Domino's Pizza Enterprises Ltd (ASX: DMP) at 12.3% and CAR Group Ltd (ASX: CAR) at 12.1%.

Zip Co Ltd (ASX: ZIP) has also entered the top ten at 10.9% after a strong recovery in its share price.

The common thread is not weak businesses, but rather a gap between what the market is paying today and what these companies currently earn.

DroneShield: growth without profit

DroneShield is the most shorted stock on the ASX, and its half-year result showed why the argument remains unresolved.

Revenue jumped 74% to $125.8 million, and recurring revenue climbed 229% to $11.5 million.

The counter-drone specialist also swung to a statutory net loss of $32.2 million, from a $2.1 million profit a year earlier.

Underlying EBITDA was a $12.4 million loss.

Cash and term deposits stood at $180 million at 30 June, so funding is not the immediate concern.

Interestingly, more than half of revenue now comes from Europe and the United Kingdom.

The complications sit elsewhere.

The company changed chief executive during the half, with Angus Bean replacing Oleg Vornik, and Hamish McLennan took over as chairman.

An ASIC investigation also remains unresolved, and that alone keeps some institutions on the sidelines.

Lotus Resources: a ramp-up under scrutiny

Lotus Resources is a different case entirely.

The uranium producer restarted its Kayelekera mine in Malawi and is ramping toward steady-state production of 2.4 million pounds of uranium oxide a year.

The resource stands at 51.1 million pounds, the mine life is around ten years, and all-in sustaining costs are expected near US$45 per pound.

Binding offtake agreements cover 3.5 million pounds of sales between 2026 and 2029.

With uranium spot prices near US$89 per pound, the economics look comfortable on paper.

Short sellers are questioning the timeline rather than the orebody.

Ramp-ups slip, and a developer without steady production has no earnings to defend its valuation.

Short interest here has fallen sharply in recent weeks, which suggests some of that scepticism is already being unwound.

What short interest does not tell you about ASX shares

Plenty of heavily shorted companies go on to perform perfectly well.

Short interest tells you that someone is betting against a business, but not that they are necessarily right.

It also creates a risk of its own, because a crowded short position can unwind violently after a single piece of good news.

Foolish takeaway

I generally treat the short report with a fair bit of caution.

However, when more than one share in ten is sold short, it is worth understanding the bear case properly before you buy.

For DroneShield, that case is about profitability and governance.

For Lotus Resources, it is about execution.

Neither argument is unanswerable, but both are good reasons to approach these ASX shares carefully.

The post Short sellers are targeting these ASX shares. Should you worry? appeared first on The Motley Fool Australia.

That's because I believe it is worth keeping a close eye on short interest levels as high levels can sometimes be a sign that something isn't quite right with a company.

With that in mind, listed below are the 10 most shorted shares on the ASX this week according to ASIC.

The top 10 most shorted ASX shares

• DroneShield Ltd (ASX: DRO) has returned to the top of the table with short interest of 14.9%, which is down slightly week on week. The counter-drone technology company remains a popular target for short sellers. This could be partly due to the ongoing uncertainty created by ASIC's investigation.
• Lotus Resources Ltd (ASX: LOT) has seen its short interest fall sharply to 13.6%, but it remains the second most shorted ASX share. The uranium developer's recent capital raising may have eased some pressure, though short sellers still appear to be questioning development timelines and uranium demand.
• 4DMedical Ltd (ASX: 4DX) has short interest of 12.4%, which is broadly unchanged since last week. The medical imaging technology company continues to divide the market. While some investors see a large commercial opportunity, short sellers may be focusing on the gap between its market valuation and its current revenue base.
• Domino's Pizza Enterprises Ltd (ASX: DMP) has seen its short interest ease to 12.3%. The pizza chain operator is trying to reset the business after a difficult period of store closures, impairments, and weaker trading. Short sellers may be waiting for clearer evidence that the turnaround will succeed.
• CAR Group Limited (ASX: CAR) has short interest of 12.1%, which is flat since last week. This may reflect concerns over the auto listings company's outlook in a difficult operating environment.
• Treasury Wine Estates Ltd (ASX: TWE) has seen its short interest rise to 12%. Short sellers may have concerns over weak wine demand and the pace of the Penfolds owner's recovery.
• Paladin Energy Ltd (ASX: PDN) has 11.2% of its shares held short, which is down slightly week on week. Short sellers appear to believe the market is too optimistic on production, costs, and uranium prices.
• PLS Group Ltd (ASX: PLS) has seen its short interest rise to 11.1%. Short sellers may be betting that prices for the battery-making ingredient remain under pressure, which would be bad news for margins.
• Zip Co Ltd (ASX: ZIP) has entered the top ten with short interest of 10.9%. Its strong share price recovery may have led some short sellers to question whether expectations have run too far, especially given weak consumer spending.
• Flight Centre Travel Group Ltd (ASX: FLT) has seen its short interest ease to 10.8%. Short sellers may still have concerns over Middle East disruption, margins, and travel demand.

The post These are the 10 most shorted ASX shares appeared first on The Motley Fool Australia.

For investors seeking ASX shares with international ambitions, Xero Ltd (ASX: XRO) and Zip Co Ltd (ASX: ZIP) are two names worth considering.

Xero: first moves in US$29 billion market

Xero is a cloud-based accounting software company that helps small and medium-sized businesses manage accounting, invoicing, payments, payroll and other financial tasks.

Australia and New Zealand provided Xero with its foundation, while the UK has developed into another substantial market. The company finished FY26 with 4.92 million customers globally, an impressive customer base for a company that began in New Zealand less than two decades ago.

Yet, Xero estimates its total addressable market at around 100 million small and medium-sized businesses worldwide.

The US could therefore be crucial to the next phase of growth for these ASX fintech shares. Xero had approximately 424,000 US customers at the end of FY26, leaving plenty of room to expand in one of management's three most important markets.

The acquisition of US billing platform Melio has strengthened Xero's US proposition by allowing businesses to manage outgoing payments directly through its platform. Management estimates the US small-business payments opportunity alone at US$29 billion.

Xero's combination of accounting, payments and payroll gives customers more reasons to stay within its ecosystem. Its JAX artificial intelligence platform could provide another growth engine by automating financial tasks and helping customers make better decisions using their existing data.

There are risks, including intense US competition and the need to integrate Melio successfully.

Zip: US is only source of customer growth

Zip is a fintech company that provides buy now, pay later and digital payment services to consumers and merchants. It is also another ASX fintech share with a rapidly expanding US opportunity. The US is already its biggest source of growth, accounting for around two-thirds of revenue in FY26.

Total revenue increased 24.7%, including 37.3% growth in the US in Australian dollar terms. In US dollar terms, US revenue climbed 44.3%, compared with just 4.6% revenue growth in ANZ.

The US is also Zip's only source of customer growth. US active customers increased 9.3% to 4.65 million, while ANZ active customers declined 8% to 1.88 million. For FY27, Zip expects US total transaction value growth of more than 30%.

Importantly, Zip isn't simply growing revenue. Operating leverage is helping profits grow substantially faster. Cash gross profit rose 26.2% to $642.3 million in FY26, while cash operating profit jumped 57.9% to $268.9 million.

That combination of strong US growth and improving profitability makes Zip one of the ASX fintech shares I think investors should keep on their radar.

The post 2 ASX fintech shares to buy for their huge US growth potential appeared first on The Motley Fool Australia.

Analysts always seek opportunities that may be undervalued. Experts can quantify how undervalued an investment might be with a price target.

A price target tells investors where they think the share price will be in 12 months from the time of the investment rating. If a price target implies capital gains of more than 10% in the next year, it could be more likely to beat the S&P/ASX 200 Index (ASX: XJO).

There are a few names that are projected to grow by 60% or more, including the following two.

IDP Education Ltd (ASX: IEL)

IDP describes itself as a global leader in international student placement and a co-owner of the world's most popular high-stakes English language test, IELTS. It helps people get accepted into their ideal course, take an English language test or learn English in its schools.

It's partnered with more than 1,000 universities and institutions across Australia, Canada, Ireland, New Zealand, the UK and the USA.

The ASX share has struggled in recent times amid the uncertainty surrounding the international student sector, but now it's seen as undervalued after falling 95% since November 2021 and down 70% since January 2026.

IDP Education reported that it was resilient during FY26, with revenue only falling by 9% to $795.4 million as low volumes were partly offset by a strong yield performance. It said that its yield improved 11% in student placement and 7% in language testing.

Student placement volumes declined by 27%, language testing volumes dropped by 8%, and language volumes increased by 1%. IDP said it was disciplined with its cost control, with direct costs down 8%. It delivered a $32 million net reduction in its overhead cost base, ahead of its $25 million target.

It also said that its adjusted operating profit (EBIT) of $122.9 million only declined by 7%.

The ASX share is planning for its market volume to drop by 20%-30% in FY27, but it expects revenue outperformance amid a focus on profitable growth and average yield improvements. The student placement and English language testing yields are expected to grow at mid-single-digit percentages.

Cost-cutting is expected to deliver a $15 million reduction in overhead costs.

According to CMC Invest, there have been nine ratings on the business within the last three months. The average price target is $3.08, implying a possible rise of 68% over the next year from where it is at the time of writing.

Zip Co Ltd (ASX: ZIP)

Another ASX share that could be one to watch is Zip, a leading buy now, pay later business.

The company recently reported its results for the 12 months to 30 June 2026, which showed impressive growth. Total transaction value (TTV) grew 27.2% to $16.7 billion, with US TTV higher by 42.5% in US dollar terms.

Total income increased 24.6% to $1.35 billion, cash operating profit (EBTDA) rose 57.9% to $268.9 million and statutory net profit after tax (NPAT) grew 45.7% to $116.4 million. It also announced a $50 million Zip share buyback.

In FY27, the ASX share expects to see US TTV growth of more than 30% in US dollar terms, and cash EBTDA could rise by 26% to $340 million.

According to CMC Invest, there have been six ratings on the business within the last three months. The average price target is $4.28, suggesting a possible rise of 69% over the next year from where it is at the time of writing.

The post 2 ASX shares tipped to grow 60% or more in the next 12 months appeared first on The Motley Fool Australia.

Zip is a rapidly growing buy now, pay later business with its main operations in Australia and the US. It has provided guidance that it intends to exit New Zealand.

The business recently reported its FY26 result which included a number of impressive growth metrics.

Given the guidance the business provided for FY27, the outlook looks promising for several reasons.

Rapid expansion in the US

To buy an ASX growth share, I think we need to see that the company's core offering has a compelling future.

I think it's safe to say that Zip is growing rapidly in the US, which is now its biggest source of growth.

In FY26, the US was responsible for around two-thirds of the company's revenue and that percentage is likely to keep growing. The company's total revenue grew by 24.7%, with 37.3% revenue growth in the US in Australian dollar terms and just 4.6% revenue growth for ANZ. In US dollar terms, US revenue rose 44.3%.

The US is also the company's only source of customer growth. During FY26, US active customers rose 9.3% to 4.65 million, while ANZ active customers decreased 8% to 1.88 million. ANZ revenue grew because of transaction growth.

In FY27, Zip is expecting US total transaction value (TTV) growth of more than 30%.

Increasing profit margins

Zip is not just growing its revenue; its profit margins are increasing thanks to operating leverage, allowing the profits to grow much faster than revenue.

The buy now, pay later business reported in FY26 that its total income rose by 24.6% to $1.35 billion, cash gross profit grew by 26.2% to $642.3 million and cash operating profit (EBTDA) jumped 57.9% to $268.9 million.

I'm not expecting Zip's cash EBITDA to continue growing at that pace forever, given how challenging it is to grow profit as the numbers get bigger.

But, as the company grows, I think its expanding scale and operating leverage will improve profit margins. The company expects its operating margin to rise again in FY27 to between 20% and 22%.

Good Zip share price valuation

At the time of writing, Zip's share price is valued at 28x FY26 earnings, which I don't think is very expensive, given its US TTV is expected to grow by at least 30%.

The projection on Commsec suggests the business could grow its earnings per share (EPS) by close to 48% to 13.6 cents in FY27, 17.8 cents in FY28 and 22.4 cents in FY29.

Those EPS forecasts suggest the company is valued at 19x FY27's estimated earnings at the time of writing. With projections of further profit growth in FY28 and FY29, the company could seem cheap at this level.

The post 3 reasons why the Zip share price could be a great buy appeared first on The Motley Fool Australia.