There has been a sell-off among some of the real estate investment trusts recently, which analysts argue is creating a buying opportunity.

I’ve selected two research reports published this week that make the case that the trusts in question have been oversold and are now worth a look for investors.

Let’s see who the analysts like.

HomeCo Daily Needs REIT (ASX: HDN)

HomeCo is down nearly 20% on a 12-month basis and is trading not far above its low for the period.

The shares have been sold off, particularly since the release of HomeCo’s results on 13 August.

Bell Potter has run the ruler over the company and believes the shares now represent good value.

One major selling point is the dividend yield, which is now sitting at 8.2%.

Bell Potter also argues that the sell-off in the shares has been overdone.

The broker said:

The stock has fallen 13.3% since results and underperformed peers over 3 months, a reaction we view as disproportionate to the underlying 2.2% FY27 earnings decline.  

Bell Potter said they expected earnings to trough this financial year, with growth returning in FY28 as the cost of debt reduces, assets are sold, and developments are completed.

The broker added that retail supply was lagging demand, “driving vacancy down and rental growth up”.

Bell Potter has a buy recommendation on HomeCo shares with a price target of $1.20 compared to $1.08 currently.

Charter Hall Group Ltd (ASX: CHC)

UBS believes Charter Hall has been oversold since early August and calls the company a “top pick” in the real estate sector.

The broker said:

Of the large cap REITs, CHC’s relative returns are most negatively correlated to bond yields which are up ~50bp in the past two months. While rising yields are clearly a headwind for the business (e.g. via lower valuations and transaction volumes), we think the market is assigning too much weight to a downside outcome despite a more resilient earnings base this cycle.

UBS said the market was likely wary of the shares, which were heavily sold off during the last interest rate increase cycle in 2022-23.

But the broker said the current rate cycle is far less dramatic, and “property values should hold up better given sharp devaluations booked across 2022-24”.

UBS has slightly reduced their price target on Charter Hall from $24.50 to $24, but that’s still well above the current level of $18.56.

Charter Hall is valued at $8.38 billion.

The post 2 ASX real estate funds that could return 23% to 35% appeared first on The Motley Fool Australia.

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Motley Fool contributor Cameron England 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 HomeCo Daily Needs REIT. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

The Aussie share market is having a strong session on Wednesday.

The S&P/ASX 200 Index (ASX: XJO) is currently up 0.96% to around 8,792 points after climbing as high as 8,797 points earlier today.

That puts the benchmark at its highest level in around 3 weeks and has it knocking on the door of 8,800 points again.

There’s plenty of buying across the market as well.

At the latest check, 149 shares were trading higher, compared with just 44 in the red and 7 unchanged.

But what I find interesting is where the rally has come from.

Wall Street didn’t give the local market much to work with overnight, with the Dow Jones Industrial Average Index (DJX: .DJI), S&P 500 Index (SP: .INX), and Nasdaq Composite Index (NASDAQ: .IXIC) all finishing slightly lower.

Instead, it appears investors have found something to like much closer to home.

Inflation comes in below expectations

The big move higher came shortly after the latest inflation figures landed at 11:30am AEST.

The Australian Bureau of Statistics (ABS) revealed that the Consumer Price Index (CPI) rose 4% over the 12 months to August.

That’s up from 3.5% in July and is the highest annual inflation rate since May 2024.

But there was some better news in the numbers.

Economists had been expecting headline inflation to come in at 4.1%, while prices rose 0.4% during August.

That compares with the 0.5% increase economists had predicted.

Underlying inflation was also slightly softer.

The trimmed mean CPI rose 0.2% for the month, below forecasts for a 0.3% increase, while the annual rate remained at 3.6%.

And that was enough to get investors buying.

Bond yields moved lower following the release.

Traders also scaled back expectations for another interest rate hike in November.

That comes just one day after the Reserve Bank of Australia (RBA) lifted the cash rate by 25 basis points to 4.6%.

ASX shares rally

The shift in interest rate expectations has helped lift shares across much of the market.

Northern Star Resources Ltd (ASX: NST) is leading the way, with its shares up 6.74% to $24.86.

The gold miner is rallying amid reports that Gold Fields could return with an improved takeover offer after its initial proposal was rejected.

REA Group Ltd (ASX: REA) shares are also having a good day, climbing 4.55% to $155.57 after receiving a broker upgrade from Bell Potter.

Elsewhere, Goodman Group (ASX: GMG) shares are up 2.92% to $26.94, while Wesfarmers Ltd (ASX: WES) shares have gained 2.82% to $76.45.

The big miners are also helping push the index higher.

BHP Group Ltd (ASX: BHP) shares are up 0.9% to $61.18, while Rio Tinto Ltd (ASX: RIO) shares have added 0.95% to $165.93.

The post Why has the ASX 200 jumped to its highest level in 3 weeks? appeared first on The Motley Fool Australia.

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Motley Fool contributor Aaron Teboneras has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Goodman Group and Wesfarmers. The Motley Fool Australia has recommended BHP Group, Goodman Group, and Wesfarmers. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

There aren’t many S&P/ASX 200 Index (ASX: XJO) shares that have been hit harder than WiseTech Global Ltd (ASX: WTC).

The WiseTech share price is currently trading around $33 a pop, leaving it down almost 20% over the past month.

Zoom out further, and things look much worse, with the logistics software company’s shares losing more than 60% over the past 12 months.

But at these levels, I think the market has gone too far.

In fact, I believe WiseTech is now one of the most undervalued growth stocks on the ASX 200.

And I’m becoming increasingly bullish on where its shares could go from here.

Look beyond the share price

It’s easy to look at WiseTech’s chart and assume something has gone seriously wrong with the business.

But its FY26 numbers tell a very different story.

Revenue jumped 79% to US$1.396 billion, while underlying EBITDA increased 56% to US$644.5 million.

CargoWise remains the part of the business that excites me most.

Revenue from the platform increased 11% to US$756.9 million in FY26, while customer attrition remains extremely low.

WiseTech also has more large global freight forwarders moving onto CargoWise, giving the company another long runway for growth.

That makes the current valuation much more interesting to me than it was when the shares were trading above $100.

The next chapter could be much bigger

But I don’t think investors should value WiseTech purely on what it earned last year.

The acquisition of e2open has dramatically increased the company’s size and created another major opportunity to improve margins.

WiseTech has already been cutting costs across the combined business, while its growing use of AI could drive further efficiencies.

The company is targeting FY27 revenue of US$1.48 billion to US$1.54 billion and underlying EBITDA of US$725 million to US$780 million.

That implies underlying EBITDA growth of roughly 12% to 21%, with margins expected to reach 49% to 51%.

Meanwhile, leverage is expected to fall to around 2.2 times by the end of FY27 and below 2 times in FY28.

Put those pieces together, and I think WiseTech could emerge from this period as a considerably larger and more profitable business.

Would I buy WiseTech shares?

Absolutely.

The market is currently treating WiseTech like its best days are behind it.

I think the opposite could prove true.

CargoWise remains an outstanding global software platform, and margins have plenty of room to improve.

Yes, there are risks, particularly around integrating e2open and delivering its FY27 targets.

But with WiseTech shares around $33, I’m more interested in the potential reward.

I think this sell-off has created one of the most attractive growth opportunities on the ASX 200.

The post Is WiseTech the most undervalued growth stock on the ASX 200? appeared first on The Motley Fool Australia.

More reading

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• Should I invest $5,000 into WiseTech and Xero shares?

Motley Fool contributor Aaron Teboneras has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended WiseTech Global. The Motley Fool Australia has positions in and has recommended WiseTech Global. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.