REA Group and Lovisa 

(AI video summary)

This video was created on 8 December 2025 for IG audiences by ausbiz.

REA Group: a digital real estate powerhouse

ASX code: REA

REA Group is highlighted as a top choice for 2026. Despite market volatility and shifting sentiment, REA continues to demonstrate exceptional financial performance:

• Return on equity (ROE): over 30%
• Return on capital: consistently strong
• Debt position: virtually debt-free after paying down its balance sheet
• Growth track record: high double-digit growth for more than a decade

While the stock isn’t cheap at around $190 per share, its valuation is becoming more attractive relative to historical levels. The current price-to-earnings (P/E) ratio of 44, though high by traditional standards, is below its 10-year average of 60. 

Lovisa: affordable fashion with high returns

ASX code: LOV

Known for its fast-fashion jewellery, Lovisa has caught attention for its impressive financial metrics:

• Return on invested capital (ROIC): nearly 30%
• Cost of capital: low, enhancing profitability
• Business model: affordable price points ($10–$20 range), appealing to budget-conscious consumers

Despite a recent share price correction and slightly softer trading updates, Lovisa’s long-term growth story remains intact. Its ability to deliver strong returns on every dollar invested makes it a standout in a market where uncertainty looms over consumer spending.