
UBS has just released a new research report naming their top ASX large-cap stocks.
The report takes into account the results from the most recent earnings season, as well as the macroeconomic environment going forward.
The broker says they are the “most compelling” opportunities drawn from a wider list of 30 stocks.
Sectors they are avoiding include the banks and consumer stocks, which could be buffeted by higher interest rates.
But they see ongoing tailwinds for the industrial and mining sectors.
Let’s see who they like specifically.
BHP Group Ltd (ASX: BHP)
UBS likes BHP for its 55% exposure to copper, which is its preferred commodity.
They said they are “constructive on the fundamental outlook for copper (and) expecting a protracted period of elevated prices”.
They have a price target of $62 on BHP shares.
Charter Hall Group (ASX: CHC)
The broker says this company is trading on a lower price-to-earnings ratio than the S&P/ASX 200 Index (ASX: XJO) despite offering higher earnings per share growth in FY27.
They added:
Earnings per share growth will be much more resilient this hiking cycle due to a higher proportion of recurring earnings, resilient institutional capital flows and tailwinds from FY26.
UBS has a price target of $24 on Charter Hall shares.
Insurance Australia Group Ltd (ASX: IAG)
IAG is UBS’ top pick among the insurance companies, reflecting its robust home and motor policy pricing, leverage to higher bond yields, and potential upside from its proposed RAC acquisition.
If that deal does not go ahead, UBS said a buyback was possible.
UBS has a price target of $9.10 on IAG shares.
Light & Wonder Inc (ASX: LNW)
UBS said this gambling company was trading at a low multiple despite guiding to mid to high-single-digit earnings growth.
The broker said the industry had strong dynamics and iGaming was growing well.
The broker has a price target of $210 on Light & Wonder shares.
Mineral Resources Ltd (ASX: MIN)
UBS said MinRes is entering a “cash harvest” phase, which should support deleveraging and increased shareholder returns.
They added:
Governance concerns have eased, with a credible succession plan now in place. Combined with a materially improved outlook, the stock’s valuation appears increasingly attractive.
UBS has a price target of $72 on MinRes shares.
Megaport Ltd (ASX: MP1)
The broker said the company’s Latitude division was reshaping its earnings profile through long-duration AI compute contracts and accelerating annual recurring revenue growth.
They said guidance had been upgraded, with further upside risk, liquidity remains strong, and any incremental revenue carried high earnings conversion.
UBS has a price target of $29 on Megaport shares.
Orica Ltd (ASX: ORI)
UBS said it expected resilient global mine production activity and the integration of recent acquisitions to drive 7% compound growth over three years.
They have a price target of $27 on Orica shares.
Sigma Healthcare Ltd (ASX: SIG)
The broker said Sigma had ongoing sales strength across existing and new stores at Chemist Warehouse in Australia and overseas.
The company was also “leveraging structural tailwinds in back of store and health & beauty, plus gross margin expansion and operating leverage from cost management in time”.
UBS has a price target of $3.15 on Sigma shares.
Ventia Ltd (ASX: VNT)
The infrastructure services company, UBS said, had a growth outlook of 8% compound over three years, “supported by increased infrastructure investment, government outsourcing, and defence spending”.
UBS has a price target of $7 on Ventia shares.
The post UBS’ top nine ASX large-cap stock picks appeared first on The Motley Fool Australia.
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More reading
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- Top brokers name 3 ASX shares to buy next week
Motley Fool contributor Cameron England has positions in Megaport. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Light & Wonder Inc and Megaport. The Motley Fool Australia has recommended BHP Group and Light & Wonder Inc. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

