Investors that are looking for some new ASX shares to buy might want to consider the two listed below.
These ASX shares have been named among the best picks by a leading broker. Here’s what Morgans is saying about them:
Santos Ltd (ASX: STO)
This energy company could be a top option for investors according to Morgans. Its analysts have put an add rating and $9.15 price target on the company’s shares. Based on the current Santos share price of $7.42, this suggests potential upside of over 23% for investors.
Its analysts like the company due to its growth profile, which was boosted from the recent merger with Oil Search.
The broker said: “We expect the resilience of STO’s growth profile and diversified earnings base see it best placed to outperform against a backdrop of a continuing broader sector recovery. STO remains our top preference amongst our large-cap energy universe.”
“With early indications supportive of our view that material synergies and enhanced growth plans will result from the OSH merger. While in good shape, we expect STO to continue gaining investor support as it executes on the opportunistic OSH merger,” it added.
Treasury Wine Estates Ltd (ASX: TWE)
Morgans is a fan of this wine giant and currently has an add rating and $14.06 price target on its shares. Based on the current Treasury Wine share price of $10.69, this implies potential upside of almost 32% for investors.
Its analysts are positive on its growth outlook and believe recent share price weakness has left its shares trading at a very attractive level. This is particularly the case in comparison to long term multiples.
The broker 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,” it concluded.
The post 2 of the ‘best’ ASX shares to buy right now appeared first on The Motley Fool Australia.
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More reading
- 5 things to watch on the ASX 200 on Friday
- 2 ASX shares to rise with higher interest rates
- 5 things to watch on the ASX 200 on Thursday
- What to expect when Treasury Wine (ASX:TWE) uncorks its results next week
- ‘A lot of opportunities’: Why this broker is bullish on Santos (ASX:STO) shares
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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