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Last week saw a large number of broker notes hitting the wires once again. Three buy ratings that caught my eye are summarised below.

Here’s why brokers think investors ought to buy them next week:

IDP Education Ltd (ASX: IEL)

According to a note out of Morgans, its analysts have upgraded this language testing and student placement company’s shares to an add rating with an improved price target of $25.09. The broker believes an effective COVID-19 vaccine could lead to international borders opening quicker than expected. This would be a big boost to IDP Education’s business. The broker also believes the company will be in a significantly better market position once trading conditions return to normal. The IDP Education share price ended the week at $23.53.

REA Group Limited (ASX: REA)

Analysts at Morgan Stanley have retained their overweight rating and $150.00 price target on this property listings company’s shares. According to the note, the broker believes that REA Group is well-placed to deliver significantly better than expected operating leverage in the near future. Particularly given the cyclical recovery in listing volumes and an additional boost from people moving for working from home reasons. The REA Group share price last traded at $138.17.

Telstra Corporation Ltd (ASX: TLS)

A note out of Credit Suisse reveals that its analysts have retained their outperform rating and $3.85 price target on this telco giant’s shares. This follows the announcement of a plan to split the company into three separate entities. It was also pleased with management’s commentary around its mobile business and expects postpaid ARPU growth in the second half. In addition to this, Credit Suisse is forecasting a 16 cents per share fully franked dividend in FY 2021. The Telstra share price ended the week at $3.13.

More reading

• AGL Energy (ASX:AGL) ventures into broadband business
• Brokers name 3 ASX shares to buy right now
• Why this broker is calling Telstra (ASX:TLS) shares a buy today
• These blue chip ASX dividend shares offer 5%+ yields
• The ASX 200 fell 0.5% on Thursday

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 Idp Education Pty Ltd. The Motley Fool Australia owns shares of and has recommended Telstra Limited. The Motley Fool Australia has recommended REA Group 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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It certainly was a great week for the S&P/ASX 200 Index (ASX: XJO) last week.

The benchmark index climbed a sizeable 215 points or 3.5% to end the period at 6,405.2 points.

Another busy week awaits investors next week. Here are five things to watch:

ASX 200 futures pointing higher.

A strong finish to the week on Wall Street looks set to give the local market a boost on Monday. According to the latest SPI futures, the ASX 200 is expected to rise 51 points at the open tomorrow. On Friday night in the United States, the Dow Jones rose 1.4%, the S&P 500 climbed 1.4%, and the Nasdaq pushed 1% higher. The S&P 500’s gain led to it closing at a record high.

Elders result.

The Elders Ltd (ASX: ELD) share price will be in focus on Monday when it hands in its full year results. The agribusiness company has been tipped by Goldman Sachs to deliver a better than expected result. It commented: “We are 5%/8% above Bloomberg EBIT/EPS consensus and expect a strong result.” It is forecasting EBIT of $116 million and earnings per share of 71 cents. Goldman has a conviction buy rating and $13.65 price target on its shares.

Afterpay AGM.

On Tuesday the Afterpay Ltd (ASX: APT) share price could be on the move when it holds its annual general meeting. Last month the payments company released a business update which revealed first quarter underlying sales of $4.1 billion. This was up 115% on the prior corresponding period. If Afterpay releases a trading update, investors will no doubt be keen to see if this sales growth has been maintained.

Aristocrat Leisure full year result.

The Aristocrat Leisure Limited (ASX: ALL) share price will be one to watch on Wednesday when it releases its full year results for FY 2020. The gaming technology company is widely expected to report a sharp decline in revenue and profits due to the impact of COVID-19 on its operations. According to a note out of Goldman Sachs, its analysts have forecast revenue of $3.94 billion and net profit after tax before amortisation of $471 million. This will be a 10% and 47% decline, respectively, over the prior corresponding period. This is despite Goldman forecasting a 27% increase in Digital revenue to $2,273 million.

Annual general meetings.

Annual general meeting season continues next week with a range of popular companies holding their virtual events. This includes infant formula company A2 Milk Company Ltd (ASX: A2M) on Wednesday and electronic design software provider Altium Limited (ASX: ALU) and job listings giant SEEK Limited (ASX: SEK) on Thursday.

More reading

• These were the best performing ASX 200 shares last week
• 3 fantastic ASX shares to buy next week
• Top fund manager tells investors to ‘go long’ in 2021
• ASX 200 drops 0.2% on Friday
• What to expect from the Aristocrat Leisure (ASX:ALL) FY 2020 results

James Mickleboro owns shares of SEEK Limited. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and recommends Altium. The Motley Fool Australia owns shares of and has recommended A2 Milk. The Motley Fool Australia owns shares of AFTERPAY T FPO. The Motley Fool Australia has recommended Elders Limited and SEEK 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 stock market crash means that investors can purchase a wide range of cheap shares today. Although ongoing risks such as coronavirus and Brexit may cause apathy towards the stock market among some investors, shares could deliver impressive returns over the long run.

Their likely recovery, low valuations and a lack of other opportunities elsewhere means that now may be the right time to build a diverse stock portfolio before the opportunity passes.

A likely recovery for cheap shares

Cheap shares are unlikely to remain at their current prices in perpetuity. Ultimately, the economy’s performance is set to improve over the coming years. This could strengthen the operating conditions for many businesses and help to justify higher valuations.

This outcome may seem somewhat distant to many investors. However, bull markets can quickly gain momentum. Previous bear markets have led to sustained bull markets that have lasted for many years. For example, the global financial crisis gave way to a decade-long bull run that lifted valuations across a wide range of sectors to their highest-ever levels.

Therefore, investors should not assume that cheap shares will be around forever. History suggests they are likely to be only temporary in nature, with today’s uncertain economic environment providing a rare opportunity for investors to buy significantly undervalued shares.

Low valuations across unpopular sectors

Some sectors have recovered strongly after the 2020 stock market crash so that they do not contain many, or even any, cheap shares. However, other sectors are currently extremely unpopular among investors. For example, industries such as travel, financial services and commodity-related businesses are in low demand among investors due to the challenging operating conditions they face in the short run.

In some cases, those low valuations are merited due to weak balance sheets and high risks being present. However, in other cases, stock prices have diverged from their intrinsic values so that investors can purchase high-quality companies while they offer wide margins of safety. Historically, doing so has provided investors with greater scope to benefit from a rising stock market.

A lack of other opportunities

Cheap shares may also be worth buying today because of the lack of opportunities available elsewhere. Low interest rates mean that cash and bonds may struggle to offer above-inflation returns over the coming years. High house prices may also cause property returns to disappoint. Meanwhile, gold’s popularity signifies that investors may already have priced in a prolonged period of low interest rates.

Therefore, now may be an opportune moment to build a diverse portfolio of undervalued stocks. They may not trade at such low prices over the long run. This could mean that investors who can look beyond short-term risks can generate impressive returns as a likely economic recovery takes hold.

More reading

• How to get rich with ASX dividend shares
• These were the worst performing ASX 200 shares last week
• Market crash 2.0: how I’d prepare for the next market sell-off
• 3 top ASX dividend shares to buy
• Are these beaten down ASX shares bargain buys?

Motley Fool contributor Peter Stephens 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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Arguably one of the biggest benefits of buy and hold investing is growing dividends.

A prime example of why this is the case is biotherapeutics giant CSL Limited (ASX: CSL).

Based on the current CSL share price, the company’s shares offer investors a rather paltry 1% dividend yield.

In light of this, few people (if any) would class CSL as a dividend share. Especially when compared to the likes of telco giant Telstra Corporation Ltd (ASX: TLS) and big four bank Commonwealth Bank of Australia (ASX: CBA).

However, there will be a small group of investors that get incredibly excited twice a year when CSL pays its dividend – its early investors.

Why is this?

Long before listing on the Australian share market, CSL was known as Commonwealth Serum Laboratories. It was established in Melbourne in 1916 to service the health needs of a nation isolated by war.

Since then it has provided Australians with access to 20th century medical advances including insulin and penicillin, and vaccines against influenza, polio and other infectious diseases. Next year it is quite likely to be supplying the country with a COVID-19 vaccine.

CSL eventually landed on the Australian share market in 1994 for the equivalent of 76 cents per share. This means that if you invested $50,000 into its shares at that point, you would have approximately 65,800 shares.

According to a note out of Ord Minnett, its analysts are expecting the company to pay a ~$3.34 dividend in FY 2021. If this proves accurate, it will mean that those early investors will be receiving a yield on cost (the yield on the price you paid for shares) of 440%.

This equates to an incredible $219,772 in dividends over the next 12 months, which is 4.4 times their original investment. All for just buying and then holding onto those shares over the years.

This is quite staggering and goes some way to demonstrating just how effective buy and hold investing can be.

More reading

• 3 fantastic ASX shares to buy next week
• After 8 months, ASX 200 shares are finally out of correction territory
• Latest ASX stocks to be hit by a broker downgrade
• ASX 200 hits 8-month high. Here’s why we could go higher from here
• CSL (ASX:CSL) share price higher after starting COVID-19 vaccine manufacturing

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 CSL Ltd. The Motley Fool Australia owns shares of and has recommended Telstra 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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Despite a soft finish to the week, the S&P/ASX 200 Index (ASX: XJO) recorded another strong gain last week. The benchmark index rose a sizeable 215 points or 3.5% to 6,405.2 points.

Not all shares were able to climb higher with the market last week. Here’s why these were the worst performers on the ASX 200 over the five days:

Ramelius Resources Limited (ASX: RMS)

The Ramelius share price was the worst performer on the ASX 200 last week with a 14.1% decline. Investors were selling its shares after a pullback in the gold price following news of a potentially effective COVID-19 vaccine being developed. This led to a huge improvement in investor sentiment and a collapse in demand for safe haven assets. For the same reason, the shares of Silver Lake Resources Limited (ASX: SLR), Saracen Mineral Holdings Limited (ASX: SAR), Westgold Resources Ltd (ASX: WGX), and Northern Star Resources Ltd (ASX: NST) all fell by around 9% over the five days.

Super Retail Group Ltd (ASX: SUL)

The Super Retail share price wasn’t far behind with an 11.9% decline. Investors were selling the retailer’s shares after analysts at Morgans downgraded them to a hold rating with an $11.78 price target. It made the move on the belief that its sales will be impacted from a post-vaccine redirection in spending.

Bapcor Ltd (ASX: BAP)

The Bapcor share price was a disappointing performer and sank 8.3% lower last week. The catalyst for this was the COVID-19 vaccine news. Investors were selling off shares that have been COVID-winners like Bapcor and rotating into underperforming areas like travel and banking. For the same reason, the ARB Corporation Limited (ASX: ARB) share price fell 8% over the five days.

Domino’s Pizza Enterprises Ltd (ASX: DMP)

The Domino’s share price was out of form and dropped 6.3% lower over the week. Once again, this was driven by concerns that its sales could be impacted post-vaccine when consumer spending is redirected to other areas such as travel and tourism. This led to analysts at Macquarie downgrading the pizza chain operator’s shares to an underperform rating with a $72.10 price target.

More reading

• 3 top ASX dividend shares to buy
• ASX gold stocks could rebound as experts tip high highs for gold in 2021
• Why Elders, Jumbo, Northern Star, & PolyNovo shares are charging higher
• ASX 200 down 0.35%: Ramsay Q1 update, NEXTDC’s international expansion, gold miners surge
• 3 shares that have reacted adversely to vaccine news

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of and has recommended Bapcor and Super Retail Group Limited. The Motley Fool Australia has recommended ARB Limited and Domino’s Pizza Enterprises 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 prospect of a second stock market crash appears to be relatively high at the present time. Risks such as the ongoing coronavirus pandemic and a weak economic outlook have the potential to cause investor sentiment to decline.

Although a market slump is not guaranteed, preparing for it now could be a sound move. After all, the stock market has never made gains without experiencing declines along the way.

Through identifying high-quality companies to buy in a market decline and reassessing current holdings, an investor could put themselves in a good position to capitalise on lower stock prices in future.

Reassessing current holdings ahead of a stock market crash

A stock market crash often coincides with a weak economic outlook. Therefore, it could be a prudent move for an investor to reassess their current holdings to ensure they have the financial strength to survive a period of weaker operating conditions.

For example, businesses with low debt levels and significant headroom when making interest payments may be better able to survive a period of weak demand for their goods or services. Similarly, companies that have access to large amounts of liquidity may be in a superior position to overcome exceptional operating conditions such as those put in place from lockdown measures in 2020.

A stock market crash can also negatively impact overvalued shares to a greater extent than their cheaper peers. Highly-valued companies’ share prices may include lofty investor expectations that, if not met, could lead to a sharp decline in their valuations. As such, it could be a sound move for an investor to check that their current holdings appear to offer fair value for money.

Preparing for buying opportunities

A stock market crash can cause high-quality companies to trade at low prices. This can provide buying opportunities for investors who are able to capitalise on them. Therefore, it could be a good move to hold some cash at the present time. The 2020 market decline lasted for only a matter of weeks before a sharp recovery took hold. Therefore, investors may not have a great deal of time to react to low stock prices.

Similarly, it may be a profitable move to identify buying opportunities before they come into existence. In other words, analysing stocks and deciding which ones to buy should they fall in price prior to a market decline may save an investor a considerable amount of time. This could make it easier for them to take advantage of a fall in the stock market’s price level.

Equity market outlook

As mentioned, there is no guarantee that a stock market crash will take place in the coming months. However, with risks to the global economic outlook being high, it may be prudent for investors to make some preparations so that they are in a good position to react positively to future equity market developments.

More reading

• 3 top ASX dividend shares to buy
• Are these beaten down ASX shares bargain buys?
• These were the best performing ASX 200 shares last week
• 3 fantastic ASX shares to buy next week
• 3 ASX shares rated as buys by brokers

Motley Fool contributor Peter Stephens 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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Each of the ASX dividend shares in this article are rated as buys.

The Motley Fool Dividend Investor service looks to find businesses that are proven, with quality management, dependable dividends and attractive yields.

Here are three that it has rated as buys:

Washington H. Soul Pattinson and Co. Ltd (ASX: SOL)

Soul Patts is an ASX dividend share that’s an investment conglomerate.

It was listed in 1903 and has paid a dividend every year since then. It has actually increased its dividend each year since 2000, including through COVID-19 – this is the longest consecutive dividend growth streak on the ASX.

It’s invested in a variety of industries including telecommunications, building products, property, resources, pharmacies, swimming schools, financial services and agriculture. TPG Telecom Ltd (ASX: TPG) is the largest position in the portfolio.

Each year Soul Patts receives dividends and other income from its investments, which it then uses some of to pay for its operating expenses, then pays out a majority of the remaining net cashflow as a growing dividend. The retained amount can be re-invested into more opportunities.

At the current Soul Patts share price, it offers a trailing grossed-up dividend yield of 3.1%.

Soul Patts is still rated as a buy by the Motley Fool Dividend Investor.

Bapcor Ltd (ASX: BAP)

Bapcor is an ASX dividend share that’s the largest auto parts business in Australia and New Zealand. It also has a small but growing presence in Asia as well.

In a recent trading update, Bapcor CEO Darryl Abotomey spoke of the company’s defensive qualities: “The automotive market is a resilient industry and historically has performed strongly in difficult economic circumstances. Recent trading is another example of its resilience assisted by the increase in sales on second hand cars, reduction in use of public and shared transport modes as well as government stimulus.”

That recent trading that he’s referring to was the first quarter of FY21, which showed group revenue was up 27% with Burson Trade revenue up 10%, retail sales up 47% (which includes Autobarn) and specialist wholesale revenue up 45%.

Bapcor has increased its dividend every year for the past several years. In FY20 it grew its dividend by 2.9%, despite the COVID-19 conditions.

At the current Bapcor share price it has a trailing grossed-up dividend yield of 3.4%.

Bapcor is still rated as a buy by the Motley Fool Dividend Investor.

Brickworks Limited (ASX: BKW)

Brickworks is an ASX dividend share that is the market leader of bricks in both Australia and the north east of the US.

It sells a variety of building products, not just bricks, including masonry, paving, roofing and precast. It has brands including Austral Bricks, Austral Masonry, Glen Gery, GB Masonry, Austral Precast and Bristle Roofing.

The company has two other divisions. It owns half of a industrial property trust along with Goodman Group (ASX: GMG). This joint venture will soon count Coles Group Ltd (ASX: COL) and Amazon as tenants because it’s specifically building two large, high-tech distribution warehouses in Sydney for the large companies.

Brickworks also has an ‘investments’ division. It is actually a major shareholder of Soul Patts, owning around 40% of the business. It has been a shareholder for decades. Brickworks has been receiving growing dividends from Soul Patts for many years, which helps fund its own dividend.

Brickworks hasn’t cut its dividend for over 40 years. At the current Brickworks share price, it offers a trailing dividend yield of 4.4%.

The ASX dividend share currently rated as a buy by the Motley Fool Dividend Investor.

More reading

• The Soul Patts (ASX:SOL) share price just hit a 52-week high
• 2 ASX dividend shares growing their dividend every year
• Brickworks (ASX:BKW) hasn’t cut its dividend for over 40 years
• 2 ASX dividend shares analysts rate as a ‘buy’
• Why Soul Patts (ASX:SOL) is a strong ASX dividend share

Motley Fool contributor Tristan Harrison owns shares of Washington H. Soul Pattinson and Company Limited. The Motley Fool Australia owns shares of and has recommended Bapcor, Brickworks, and Washington H. Soul Pattinson and Company Limited. The Motley Fool Australia owns shares of COLESGROUP DEF SET. 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 S&P/ASX 200 Index (ASX: XJO) was on form again last week and recorded a very strong gain. The benchmark index jumped 215 points or 3.5% to 6405.2 points.

While the majority of shares on the index climbed higher over the period, some climbed more than most. Here’s why these were the best performers on the ASX 200:

Virgin Money UK CDI (ASX: VUK)

The Virgin Money UK share price was the best performer on the ASX 200 last week with a 32.4% gain. Investors were buying the UK-based bank’s shares after Pfizer revealed very positive data from its phase 3 COVID-19 vaccine trial. Given how bad the situation is in the UK, the prospect of a working vaccine being released by the end of the year has given investor sentiment a huge boost.

Unibail-Rodamco-Westfield CDI (ASX: URW)

The Unibail-Rodamco-Westfield share price wasn’t far behind with a gain of 31.2%. This was also driven by the positive COVID-19 vaccine news. Given that many of Unibail-Rodamco-Westfield’s shopping centres around the world have been ghost towns, this news is a major boost. It could mean foot traffic starts to return to normal in 2021, which will help the company collect rent again.

Oil Search Limited (ASX: OSH)

The Oil Search share price was an exceptionally strong performer last week and jumped 30.3% over the five days. Investors were buying the company’s shares after oil prices jumped higher following the vaccine news. If life returns to normal sooner than expected, demand for oil is likely to strengthen greatly and support higher prices. For the same reason, the Beach Energy Ltd (ASX: BPT) share price jumped 23.9% and the Santos Ltd (ASX: STO) share price stormed 18%.

Fletcher Building Limited (ASX: FBU)

The Fletcher Building share price was on form and surged 21.7% higher last week. Investors were buying the building products company’s shares after the release of a positive trading update. That update reveals that Fletcher Building has started FY 2021 strongly. For the first four months of the financial year, its earnings before interest and tax (EBIT) before significant items is up NZ$80 million or 54.4% to NZ$227 million.

More reading

• Top fund manager tells investors to ‘go long’ in 2021
• ASX 200 drops 0.2% on Friday
• Fund manager says Treasury Wine (ASX:TWE) share price is too cheap
• ASX gold stocks could rebound as experts tip high highs for gold in 2021
• ASX 200 down 0.35%: Ramsay Q1 update, NEXTDC’s international expansion, gold miners surge

Motley Fool contributor James Mickleboro 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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While a number of shares have just reached 52-week highs or better such as SEEK Limited (ASX: SEK) (see here), not all shares are performing as strongly.

Two ASX shares that have been beaten down this year are listed below. Here’s why they are being tipped as bargain buys:

Bravura Solutions Ltd (ASX: BVS)

Bravura Solutions is a provider of software products and services to the wealth management and funds administration industries. Its shares have fallen heavily this year and are down a disappointing 46% from their 52-week high. This has been driven largely by management’s underwhelming guidance for FY 2021. It has warned that the pandemic could lead to flat profits this year.

One broker that thinks investors should be taking advantage of the weakness in the Bravura share price is Goldman Sachs. It recently reiterated its buy rating and put a $4.50 price target on its shares.

The broker believes Bravura is well positioned due to its strong market position in existing product offerings (which have a high degree of recurring revenue), its emerging microservices ecosystem strategy, and strong net cash position. It believes the latter provides the company with the flexibility to invest in the new microservices ecosystem and pursue further acquisitions.

Lendlease Group (ASX: LLC)

Although it has recovered strongly over the last six weeks, the Lendlease share price is still down 28% from its 52-week high. This share price weakness has been driven largely by the negative impacts of the pandemic on the international property and infrastructure company’s performance. This led to the company recording a net loss of $310 million in FY 2020.

The good news for shareholders is that the company has recently divested its struggling engineering business and announced the launch of a major new strategy. This strategy is shifting Lendlease’s earnings mix and business model towards that of high flying industrial property giant Goodman Group (ASX: GMG).

This shift has gone down well with Goldman Sachs, which has slapped a buy rating and $16.74 price target on the company’s shares. It notes that Lendlease’s shares are trading on low multiples, particularly in comparison to Goodman Group. The broker suspects that this discount could narrow if Lendlease executes its new strategy successfully.

More reading

• Here’s where this ASX fund manager is investing right now
• These ASX dividend shares beat term deposits and savings accounts
• 2 ASX dividend shares with better yields than term deposits
• Why REITs led the pack on the ASX today
• Elections, pandemics and rate cuts. Where to next for ASX share prices?

Motley Fool contributor James Mickleboro owns shares of SEEK Limited. The Motley Fool Australia owns shares of and has recommended Bravura Solutions Ltd. The Motley Fool Australia has recommended SEEK 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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If you’re looking for some shares to buy in November, then you might want to take a look at the three buy-rated shares listed below.

Here’s why they are highly rated:

Altium Limited (ASX: ALU)

Altium is the electronic design software platform provider responsible for the award-winning Altium Designer product. Demand for its platform has been growing strongly in recent years thanks to its exposure to the rapidly growing Internet of Things and artificial intelligence (AI) markets. Management expects this to continue and is aiming to increase its revenue by 150% to US$500 million by 2025-26.

One broker that is positive on its chances of achieving this is Morgan Stanley. Its analysts have an overweight rating and $40.00 price target on the company’s shares.

Appen Ltd (ASX: APX)

Appen is a leading developer of high-quality, human annotated datasets for machine learning and AI. It prepares and/or creates the data for the machine learning models of some of the largest tech companies such as Facebook and Microsoft. This is a vital part of the development process, as without high quality data a model will never reach its potential.

Analysts at Macquarie believe Appen is well-placed for growth over the medium term thanks to AI tailwinds. The broker has an outperform rating and $43.00 price target on the company’s shares.

CSL Limited (ASX: CSL)

CSL is one of the world’s leading biotherapeutics companies. It is comprised of the CSL Behring business and the Seqirus influenza vaccine business. Both businesses have been growing their top lines at a solid rate in recent years. This has been driven by increasing demand for immunoglobulins, its growing plasma collection network, and its high level of investment into research and development.

One broker that is confident that there will be more of the same in the future is UBS. Its analysts recently slapped a buy rating and $346.00 price target on the company’s shares.

More reading

• After 8 months, ASX 200 shares are finally out of correction territory
• Why are ASX tech shares all over the place today?
• Latest ASX stocks to be hit by a broker downgrade
• 2 ASX growth shares to buy in November
• ASX 200 up 1.3%: CBA Q1 update, tech shares rebound, JB Hi-Fi sinks

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 Altium. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of Appen Ltd and CSL Ltd. 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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