Exchange-traded funds (ETFs) can be an investor’s best friend. ASX ETFs provide instant diversification and can be used to invest in the broader market or a concentrated sector or geography.

Here are a few of my favourite ETFs on the market right now.

Vanguard Australian Shares Index ETF (ASX: VAS)

I’m a big fan of this ASX ETF for broad market exposure to the S&P/ASX 300 Index (ASX: XKO).

Some investors may be worried about home bias, where you overinvest in your local market. However, I think Aussie investors should have a large holding of Australian shares to reduce currency risk in their investments.

There’s also the boost that franking credits on Australian shares can provide, which is why I like this ASX ETF.

ETFS FANG+ ETF (ASX: FANG)

This ETF Securities fund provides exposure to some of the top tech stocks in the world. The fund comprises large holdings in US and other global tech stocks including the ‘FAANG’ group comprising Facebook Inc (NASDAQ: FB), Apple Inc (NASDAQ: AAPL), Amazon.com Inc (NASDAQ: AMZN), Netflix Inc (NASDAQ:NFLX) and Alphabet Inc (NASDAQ: GOOG).

The ETFS FANG+ ETF is up 44.2% since its inception in late February. This ASX ETF offers diversified exposure concentrated in the tech and telecom space with a management cost of 0.35% p.a. 

ETFS Reliance India Nifty 50 ETF (ASX: NDIA)

This ETF Securities ETF provides a exposure to the Indian economy by attempting to track its Nifty50 benchmark index.

The ETFS Reliance India Nifty 50 ETF uses a full-replication strategy to track the index which means very similar holdings and weightings to the benchmark.

I think India’s economy is set to boom in the coming decades. It is forecast to be the world’s third largest by 2030, according to research by Standard Chartered. We could also see Australia diversify trade away from China towards India, which is good for business.

The coronavirus pandemic hit the Nifty50 hard, but now could be a good time to buy this ASX ETF on the cheap.

More reading

• Why you’re better off investing in ASX shares in 2020 than paying off the mortgage faster
• Buy Fortescue and this ASX dividend share for a source of income
• The 3 best ETFs for passive investing
• How to make $1 million from ASX shares
• Is a passive ASX investing strategy for you?

Motley Fool contributor Ken Hall owns shares of Vanguard Australian Shares Index. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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Cochlear Limited (ASX: COH) shares have not had a good year in 2020 so far. After topping out at a new (and still standing) all-time high of $251.55 back in February, the Cochlear share price is today asking just $200.50 at the time of writing. That’s more than a 20% discount to the February high watermark. Now just because a share has pulled back 20% from its most recent high, this does not mean it’s automatically ‘on sale’ or a ‘good deal’. But it does merit some digging in my view, particularly when the company in question is as high calibre as Cochlear.

Lend me your ears…

Cochlear is one of the most successful ASX shares in the healthcare space. It famously pioneered the ‘Cochlear implant’ – a hearing aid device now universally recognisable. The company has continued to remain in the vanguard of hearing aid technology and is still a market leader in the space. It now has a truly global presence, with 20% of its sales now coming from emerging markets. It holds a 60% share of its global product market.

However, like many ASX companies, both Cochlear and its shares have been under pressure this year due to the coronavirus pandemic. In its FY2020 earnings report released last month, Cochlear reported a loss of $238.3 million for the year on revenues of $1.35 billion, mostly due to surgery deferrals as a result of the pandemic. As such, the company will not be paying a final dividend in 2020.

Why is the Cochlear share price a buy today then?

I think Cochlear is worth a good look today, even after its disappointing earnings report. Yes, Cochlear has taken a massive hit this year. But the market that it serves (people with a hearing impairment) hasn’t gone anywhere. Cochlear serves a large customer base with inelastic demand for its products. Many of the company’s patients are born with a hearing impairment, which means they have a fair chance of being Cochlear customers for life. The company already has a dominant position in advanced economies around the world and as incomes rise in emerging markets, more and more potential customers are finding Cochlear as well.

As such, I think the pullback we’ve seen in the Cochlear share price this year presents a solid buying opportunity. Quality companies like Cochlear don’t go on sale often, and so I think this is a rare chance to open a position or double-down if you already have one.

More reading

• How to be the next Warren Buffett with ASX shares
• Why Atlas Arteria, Cochlear, Telix, & Treasury Wine shares are dropping lower
• The Aussie dollar at a critical juncture and could turn fortunes for these ASX stocks
• Top brokers name 3 ASX shares to sell today
• Forget BrainChip (ASX:BRN) and buy and hold these outstanding ASX shares

Sebastian Bowen has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of Cochlear Ltd. The Motley Fool Australia has recommended Cochlear Ltd. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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The rebound in ASX lithium shares came to a grinding halt after Tesla’s battery day. Could Elon Musk’s comments about lithium continue to strain the lithium market or is this a buying opportunity for ASX lithium shares?

ASX Lithium shares stumble 

The Galaxy Resources Limited (ASX: GXY), Pilbara Minerals Ltd (ASX: PLS) and Orocobre Limited (ASX: ORE) share prices have fallen into negative territory this year following Tesla’s battery day announcements. Musk highlighted that lithium is a “widely available resource, one of the most common resources on the planet” and that “Nevada alone has enough to power all vehicles in the US”. Tesla announced its intentions to simplify the process to extract lithium and acquired rights to mine some of its supply from 10,000 acres in an unspecified part of Nevada. 

While the mass production of electric vehicles by Tesla and other manufacturers will require a lot more lithium, Musk’s comments about localising supply casts doubt as to the relevancy of ASX lithium producers. This has seen the Galaxy Resources share price fall 30%, Pilbara Minerals share price fall 18% and Orocobre share price fall 10% last week.

One of the few lithium players that emerged from Battery Day unscathed was Piedmont Lithium Ltd (ASX: PLL). Piedmont is a lithium player focused on its pre-production business of spodumene concentrate and lithium hydroxide in North Caroline, US. The Piedmont Lithium share price soared more than 70% today following its sales agreement with Tesla. This agreement covers a fixed commitment of 160,000 tonnes per annum for an initial five-year term as well as additional quantity to be delivered at Tesla’s option. While this agreement does paint the narrative that more lithium will be required for the ‘electric vehicle revolution’, it does appear that Tesla has a geographic preference of where the lithium is sourced. America. 

How are lithium prices?

The catalyst that saw ASX lithium miners spiral from billion dollar valuations to just millions was the oversupply of lithium in the market. This is no different than the supply and demand factors that affect the likes of iron ore miners Fortescue Metals Group Limited (ASX: FMG) and BHP Group Ltd (ASX: BHP).

The challenge is that there has not been any improvement in the lithium spot price for many years. Fastmarkets highlights lithium prices sitting at multi-year lows with brief periods of stability. Even before Tesla’s battery day and an improvement in ASX lithium share prices, there was not any material improvement in market conditions. 

ASX lithium shares have rebounded on the positive medium to long term outlook in the market. Galaxy Resources for example, believes that the significant stimulus packages in both the EU and China are expected to drive electric vehicle led lithium demand. Furthermore, automakers remain committed to ‘electrifying’ their fleets and many major manufacturers have recently reinforced their relationships with tier 1 battery manufacturers. 

Foolish takeaway

Tesla’s intentions to localise lithium supply has weighed down an already vulnerable lithium market. While the medium-long term outlook could still be intact, the weak lithium spot price today means that producers are likely to continue to burn through cash for the near future. I believe the run is likely to be over for ASX lithium shares but investors should continue to watch the space for any signs of improvements. 

More reading

• Piedmont Lithium (ASX:PLL) share price rockets 83% higher on Tesla deal
• 3 ASX shares with dividend yields above 10%
• ASX 200 Weekly Wrap: Bank shares push ASX 200 higher
• Are these blue chip ASX 200 shares worth buying?
• 2 high yield ASX blue chip dividend shares to buy next week

Motley Fool contributor Lina Lim has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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If you’re a fan of investing in small cap shares, then you’re in luck.

Right now, there are a number of companies at the small side of the market which I believe have a lot of potential.

Here’s why I think they should be on your watchlist:

Carbon Revolution Ltd (ASX: CBR)

Carbon Revolution is a $370 million advanced manufacturing company that designs, manufactures, and markets single piece carbon fibre wheels for motor vehicles. By being able to manufacture wheels in this way, the company is able to reduce the weight of them significantly. This is a big positive as management estimates that these weight savings can result in up to 40% reductions in inertia. This is really significant for car companies, which are always looking to make their vehicles more efficient. Carbon Revolution counts the likes of Ford and Ferrari as customers. I believe this is a testament to the quality of its products.

Mach7 Technologies Ltd (ASX: M7T)

Another small cap ASX share to watch closely is Mach7. It is a $247 million developer of innovative enterprise imaging and informatics solutions for image viewing, storage, and workflow management. These solutions are able to be implemented individually, or as a comprehensive end-to-end image management and diagnostic viewing platform. The company has designed them to assist healthcare organisations with removing technology limitations to ensure patient information flows easily and can be accessed instantly. This helps to inform diagnosis, reduce care delivery delays and costs, and improve patient outcomes. Management estimates that Mach7’s total addressable market is worth US$2.75 billion per year.

Whispir (ASX: WSP)

A final small cap ASX share I would recommend you put on your watchlist is Whispir. It is a $379 million software-as-a-service communications workflow platform provider. This increasingly popular platform automates communications between organisations and people. This enables organisations to improve their communications through automated workflows to ensure stakeholders receive accurate, timely, useful, and actionable insights. Management estimates that the Workflow Communications platform as a Service market could reach US$8 billion per year by 2024.

More reading

• Why have ASX tech founders been unloading shares?
• 3 ASX tech shares that could take off in FY21
• These 4 ASX shares have grown more than 100% this year
• 3 exciting small cap ASX tech shares that could be the next big thing
• Forget Afterpay (ASX:APT) shares, buy these 3 growth shares

James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and recommends MACH7 FPO and Whispir Ltd. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of Carbon Revolution Limited. The Motley Fool Australia has recommended Carbon Revolution Limited, MACH7 FPO, and Whispir Ltd. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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When it comes to buying ‘cheap’ ASX shares, valuation is often in the eye of the beholder. It was pretty easy to call CSL Limited (ASX: CSL) overvalued at most points over the past decade. Yet buying it at any time before 2020 turned out to be a pretty good idea. It’s a story often repeated, most famously with the US technology titan Amazon.com Inc. (NASDAQ: AMZN), which even today trades at a price-to-earnings (P/E) ratio of 118.

But that problem isn’t one afflicting the ASX shares named below. Here are two ASX shares that I think are cheap and undervalued today. Now, as with most ‘cheap’ shares, the two companies named below are trading at relatively low valuations for a reason. However, I think both are still worthy of consideration today.

2 ASX shares selling cheap today

Virgin Money UK (ASX: VUK)

Virgin Money UK is my first cheap ASX share today. It’s a United Kingdom-based bank, formerly known as Clydesdale Bank, that was spun-out of National Australia Bank Ltd (ASX: NAB) a few years ago. Since then, the company’s share price hasn’t been a nice thing to watch. It last peaked at $6.21 back in July 2018, but has trended lower ever since. Like most bank shares, the coronavirus outbreak has been devastating for the Virgin Money share price, which is languishing at $1.30 at the time of writing after falling another 2.8% today.

But I think this bank’s share price is so cheap now that it’s worthy of a good hard look. Yes, the UK’s economy is being hit very hard at the moment. A second wave of coronavirus infections is unfortunately sweeping through the country and, as such, UK bank shares like Virgin Money are being put through the wringer. But I think Virgin Money is well-poised for a strong recovery once the country opens back up. Like in Australia, the UK banking sector does enjoy strong support from the government, so I think there is very little risk of this company hitting the wall. It could make a good turnaround play at its current prices.

A2 Milk Company Ltd (ASX: A2M)

a2 Milk is my second cheap share to consider today. The company is being hit hard today, with the a2 Milk share price down almost 11% to $15.37 in Monday’s trade (at the time of writing). The catalyst for this hefty move? This morning a2 Milk told the markets that, due to disruption to daigou reseller channels, the company is now expecting revenues to decline year on year for the first half of FY2021 by between 3.9% and 10.1%.

Whilst this is obviously not good news for a2 Milk, I think it will prove to be a temporary setback. This company has been one of the most phenomenal ASX success stories over the past decade. The a2 Milk share price has rewarded shareholders with more than 2,200% in gains over the past five years. With its powerful brand and successful management team, I think this pullback is a great buying opportunity for a long-term investment in a2 Milk today.

More reading

• I think it’s time to jump on the A2 Milk (ASX:A2M) share price
• ASX 200 up 0.1%: a2 Milk crashes lower, Flight Centre and Webjet surge higher
• Why a2 Milk, Blackmores, Ramelius, & Synlait Milk shares are tumbling lower
• ASX 200 Weekly Wrap: Bank shares push ASX 200 higher
• a2 Milk (ASX:A2M) share price on watch after guidance update

John Mackey, CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool’s board of directors. Sebastian Bowen has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and recommends Amazon. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of CSL Ltd and recommends the following options: short January 2022 $1940 calls on Amazon and long January 2022 $1920 calls on Amazon. The Motley Fool Australia owns shares of A2 Milk. The Motley Fool Australia has recommended Amazon. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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The market may be pushing higher this afternoon but missing out on the action are the shares of Corporate Travel Management Ltd (ASX: CTD) and Starpharma Holdings Limited (ASX: SPL).

Both companies requested trading halts this morning before the market open. Here’s why they are halted:

Corporate Travel Management

The Corporate Travel Management share price was placed into a trading halt this morning until Thursday whilst it undertakes the institutional component of an accelerated entitlement offer. According to the request, unlike many of its peers, the company isn’t raising funds for liquidity. Rather, it is raising these funds to make a potential acquisition.

No details were given with the release, but the AFR has reported that Corporate Travel Management is understood to be raising $400 million to make a company-changing acquisition. It remains unclear which company management has its eyes on. And given that it operates globally, there certainly are a lot of options for it to choose from.

Starpharma

The Starpharma share price has gone into a trading halt on Monday so that the dendrimer products developer can launch an equity raising. This will comprise an institutional placement and an accompanying share purchase plan. Starpharma’s shares are expected to return to trade on Wednesday following the completion of the institutional component of the equity raising.

Once again, no details were given with the trading halt request. However, the company is understood to be looking to raise a total of $45 million from investors at a price of $1.50 per new share. This represents a 6.5% discount to its last close price. Some of the funds are expected to be used to support the commercialisation and launch of its COVID-19 nasal spray. Other funds are likely to be used towards the advancement of its promising DEP drug delivery technology.

More reading

• These are the 10 most shorted ASX shares
• Will the Corporate Travel (ASX:CTD) share price surge in 2021?
• ASX 200 falls 0.7%, UK and travel shares drop
• Rhinomed (ASX:RNO) share price tries following Starpharma’s path to COVID glory
• Starpharma (ASX:SPL) share price jumps on COVID-19 nasal spray update

James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of Starpharma Holdings Limited. The Motley Fool Australia owns shares of and has recommended Corporate Travel Management Limited. The Motley Fool Australia has recommended Starpharma Holdings Limited. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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The Piedmont Lithium Ltd (ASX: PLL) share price has return from its lengthy suspension with a bang on Monday.

The lithium miner’s shares rocketed as much as 83% to a record high of 27 cents at one stage in late morning trade.

At the time of writing, the Piedmont Lithium share price is up 53% to 23 cents.

Why is the Piedmont Lithium share price rocketing higher?

Investors have been fighting to get hold of the company’s shares on Monday after it announced a binding sales agreement with electric vehicles giant Tesla.

According to the release, Piedmont Lithium has signed an agreement for an initial five-year term for the supply of spodumene concentrate (SC6) from its North Carolina deposit. The deal includes the option to extend it for a further five years by mutual agreement.

Piedmont and Tesla have agreed a fixed commitment which represents approximately one-third of the lithium miner’s planned SC6 production of 160,000 tonnes per annum. It also includes an option for additional SC6 upon Tesla’s request.

While no financial terms have been revealed, management notes that these sales are expected to generate between 10% to 20% of its total revenues from its proposed integrated mine-to-hydroxide project for the initial five-year term.

However, it is worth noting that the agreement is conditional upon the two parties agreeing to a start date for deliveries. This will be between July 2022 and July 2023, depending on their respective development schedules.

“Excited to be working with Tesla.”

The company’s Chief Executive Officer, Keith D. Phillips, revealed that the company was very pleased with the agreement and looks forward to disrupting the current value chain.

He commented: “We are excited to be working with Tesla, which represents the start of the first US domestic lithium supply chain and a disruption to the current value chain. This Agreement highlights the strategic importance of Piedmont’s unique American spodumene deposit and confirms the trend toward spodumene as the preferred feedstock for the lithium hydroxide required in high-nickel batteries.”

More reading

• Why Tesla’s record vehicle deliveries sound better than analysts might think
• Tesla stock will surge 27% to $500, according to this analyst
• Why this fundie still sees an ASX tech share surge
• How Elon Musk’s Tesla delivered a body blow to these ASX stocks
• Elon Musk’s ‘Battery Day’ could see these ASX mining shares soar, and volatility hits the markets

James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and recommends Tesla. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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At the weekend I looked at how $20,000 investments in a few popular ASX shares had fared over the last 10 years. You can read about those investments here.

But that was then and this is now. So where could we find similarly strong returns over the next 10 years?

Listed below are three top ASX shares that I think could generate strong returns for investors in the future. Here’s why I would invest $20,000 into them today:

BetaShares NASDAQ 100 ETF (ASX: NDQ)

The first option to consider buying with these funds is the BetaShares NASDAQ 100 ETF. I think it could provide strong returns for investors over the next decade thanks to the high quality companies included in the fund. The BetaShares NASDAQ 100 ETF gives investors a piece of the 100 largest non-financial companies listed on the famous NASDAQ exchange. This means investors will be getting exposure to the likes of Amazon, Apple, Facebook, Microsoft, Netflix, and Google parent company, Alphabet.

NEXTDC Ltd (ASX: NXT)

Another option to consider for a $20,000 investment is NEXTDC. It is a leading data centre operator which owns a growing collection of world class centres in key locations across Australia. NEXTDC has been experiencing very strong demand for capacity in its data centres over the last few years. This continued in FY 2020, leading to the company delivering a 23% increase in EBITDA to $104.6 million. The good news is that the cloud computing boom still has a long way to run and NEXTDC appears perfectly positioned to benefit.

VanEck Vectors China New Economy ETF (ASX: CNEW)

A final option to consider for a $20,000 investment is another exchange traded fund. This time it is the VanEck Vectors China New Economy ETF, which gives Australian investors access to the growing Chinese economy. This is through a total of 120 promising companies with very strong growth prospects. The fund’s focus is on companies making up ‘the New Economy’. These are sectors such as technology, healthcare, consumer staples, and consumer discretionary. If the Chinese economy continues its strong growth over the next decade, I expect these companies to grow along with it.

More reading

• 10 fantastic ASX shares to buy in October
• 3 of the best ASX growth shares you can buy right now
• Want to invest in US shares? This ETF is a top option
• 2 ASX shares I would recommend to a beginner investor
• Where to invest your Telstra (ASX:TLS) dividends

James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of BETANASDAQ ETF UNITS. The Motley Fool Australia has recommended BETANASDAQ ETF UNITS. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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Three ASX shares stood out to me after Friday’s mini rally in mortgage-related companies. The market was clearly excited by the prospect of easing responsible lending laws. Banks led the charge with the Westpac Banking Corp (ASX: WBC) share price rocketing up by 7.39%. However, I see banks as a problematic area to invest in. The regulator, Australian Prudential Regulation Authority (APRA), has already limited what they can pay in dividends. In addition, banks are still feeling the impacts of loan repayment holidays.

However, the mortgage sector is very large and there are a number 0f companies that did very well on Friday outside of banks. In fact, when there is a ray of optimism in the residential housing sector, you get an idea of just how large the impact is.

ASX shares for mortgage brokers

Mortgage brokers are high margin operators not subject to the same regulations as authorised deposit taking institutions (ADIs). They are distribution channels for the mortgage industry, helping clients to secure secured loans for residential housing predominantly. 

The first that caught my attention was Mortgage Choice Limited (ASX: MOC) which saw its share price rise by 7.14% on Friday and has rocketed 10% higher at the time of writing today. The company showed a high level of resilience through the coronavirus pandemic lockdown with only a 16% fall in annual net profit after tax (NPAT). Mortgage Choice is currently selling at a price to earnings ratio (P/E) of 12.6, which is lower than its 10-year average of 17.6. It also has a trailing 12 month dividend yield of 6.9%. 

The second mortgage broker, and one I have liked for a while, is Australian Finance Group Ltd (ASX: AFG). This ASX share saw its price rise by 5.41% on Friday alone. Unlike Mortgage Choice, Australian Finance Group saw its statutory NPAT rise by 15%. It also saw residential settlements rise by 9% to $34.1 billion. Part of the company’s revenue streams are drawn from renewed interest in Residential Mortgage Backed Securities (RMBS). These are a specific type of bond that are secured against a large pool of residential mortgages (home loans). 

Mortgage insurance

Genworth Mortgage Insurance Australia Ltd (ASX: GMA) is a pure-play mortgage insurance company. It saw its share price jump by a massive 10.21% on Friday. Like the other mortgage brokers, Genworth is selling at historically low P/E multiples. Nevertheless, the company has a TTM dividend yield of 10.86%, which is very strong. The company reported a bad first half of FY20 from January to June, however it has a solid balance sheet with only a minor increase in net liabilities. 

If the housing sector gets a boost due to the easing of lending laws, then Mortgage Choice will also see an increase in top line revenue. Personally, I expect to see the company’s share price rise further as the market turns its attention to recovery.

More reading

• ASX 200 shares to buy for housing boom
• Westpac (ASX:WBC) and 2 more ASX 200 shares to watch this week
• ASX 200 Weekly Wrap: Bank shares push ASX 200 higher
• Top brokers name 3 ASX shares to buy next week
• ASX 200 finishes the week with a bang

Motley Fool contributor Daryl Mather has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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With so many shares to choose from on the ASX, it can be hard to decide which ones to buy.

The good news is that brokers across the country are doing a lot of the hard work for you.

Three top shares that leading brokers have named as buys this week are listed below. Here’s why they are bullish on them:

Northern Star Resources Ltd (ASX: NST)

According to a note out of the Macquarie equities desk, its analysts have retained their outperform rating and lifted their price target on this gold miner’s shares to $16.60. The broker notes that Northern Star is aiming to increase its production by 40% through to FY 2023. It is also targeting a 10% reduction in costs. In light of this and its favourable dividend policy, the broker thinks Northern Star would be a good option for investors looking for exposure to the gold sector. I agree with Macquarie and think Northern Star could be a good option.

Premier Investments Limited (ASX: PMV)

Analysts at UBS have retained their buy rating and lifted the price target on this retail conglomerate’s shares to $20.50. UBS notes that Premier Investments delivered a result in line with expectations in FY 2020. Looking ahead, the broker expects its earnings to decline in FY 2021 because of COVID-19 headwinds. However, longer term, UBS is very positive on the company’s prospects. This is thanks partly to the global expansion of the Smiggle brand and its improving margins due to a shift in its sales mix. While it isn’t my favourite option in the retail space, I think it is worth considering.

Suncorp Group Ltd (ASX: SUN)

Another note out of the Macquarie equities desk reveals that its analysts have upgraded this insurance and banking giant’s shares to an outperform rating with an $11.00 price target. The broker made the move largely on valuation grounds. It notes that Suncorp’s shares are trading at a significant discount to the market average. It feels this is unwarranted and believes that the bank provisions it has made are reasonable. I think Suncorp could be worth a closer look if you’re a value or income investor.

More reading

• 5 things to watch on the ASX 200 on Monday
• ASX 200 finishes the week with a bang
• ASX 200 up 1.5%: Big four banks rocket higher, Premier Investments delivers record profit
• Why Adbri, Brickworks, Northern Star, & Westpac shares are surging higher today
• Premier Investments (ASX:PMV) share price on watch after record profit result

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of and has recommended Premier Investments Limited. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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