If you’re looking for some new options for your portfolio, then you may want to look at the shares listed below which Morgans rates highly.
Here’s why it has the equivalent of buy ratings on these ASX 200 shares:
Treasury Wine Estates Ltd (ASX: TWE)
The last two years have been difficult for this wine giant due to COVID-19 and China shutting out its premium Australian wines. The good news is that Morgans believes that the company’s outlook is improving greatly and its shares are trading at an attractive level.
Morgans commented: “TWE has the China reallocation risk and it will take 2-3 years to recover these earnings in new markets. However once it comps China earnings, we expect TWE to deliver strong earnings growth from the 2H22 onwards. Organic growth will be supplemented by M&A. On this front, we view TWE’s recent acquisition of Napa Valley luxury wine business, Frank Family Vineyards (FFV) as strategically important. This high margin business should see TWE achieve its US margin target two years earlier than planned. We see recent share price weakness as a great buying opportunity in this high quality company. The stock is currently trading at a material discount to its long term PE range.”
The broker currently has an add rating and $14.06 price target on the company’s shares. This compares to the latest Treasury Wine share price of $12.08.
Woodside Petroleum Limited (ASX: WPL)
If you’re interested in gaining exposure to the energy sector, then Morgans thinks Woodside could be a quality option. This is due largely to its transformative merger with the petroleum assets of BHP Group Ltd (ASX: BHP).
Morgans explained: “We believe WPL has benefited from being in the right place, at the right time. With: 1) BHP/WPL having an existing relationship, 2) BHP eager to boost its ESG profile, and 3) WPL being a quality operator (safe hands which is important for BHP). From an economic standpoint we think WPL is clearly getting the better of the deal, with synergies not baked into deal metrics and BHP willing to accept a discount. The deal is transformative, lifting WPL into being a top 10 global E&P with +2 billion barrels of 2P reserves, with EBITDA of US$4.7bnpa and growth options.”
The broker currently has an add rating and $29.95 price target on its shares. This compares to the current Woodside share price of $22.03.
The post Morgans names 2 ASX 200 shares to buy appeared first on The Motley Fool Australia.
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More reading
- 5 things to watch on the ASX 200 on Friday
- Woodside (ASX:WPL) share price dips as company eyes east coast market
- How did the Treasury Wine (ASX:TWE) share price perform in November?
- 5 things to watch on the ASX 200 on Thursday
- Woodside (ASX:WPL) share price rises on $5 billion new energy plan
Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has recommended Treasury Wine Estates Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.
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