Brokers say buy these 2 ASX shares today

Credit: austinwood23

The S&P/ASX 200 (Index: ^AXJO) (ASX: XJO) and the wider market provide investors with so much choice it can be hard to know where to begin looking.

Fortunately, there are teams of people across the country trying to solve this conundrum on your behalf. Despite the volatility in the market acting as a distraction, brokers have been busy recommending shares once again.

I’ve decided to take a look at two shares which have recently been recommended as buys:

Myob Group Ltd (ASX: MYO)

MYOB was given a buy rating with a price target of $4.30 by Ord Minnett. The price target implies upside of over 31% for the shares of this growing Australian tax and accounting software company.

MYOB is a great business and its software is of a high quality, but personally I believe its rival XERO FPO NZX (ASX: XRO) has superior software and growth prospects.

In March Xero revealed it added 242,000 net new subscriptions for its software, bringing its total subscriptions to 717,000. Recently The Australian newspaper reported that Xero’s Australian managing director, Trent Innes, expects its latest Xero Tax product for Xero’s partners to overtake MYOB’s market share within this specific product field by May 2017. I would recommend an investment in Xero over MYOB for this reason among others.

Greencross Limited (ASX: GXL)

According to CommSec, integrated pet-care business Greencross has been upgraded to a consensus buy rating by brokers this week. As well as being a quality business with solid growth prospects, I believe this upgrade may also be related to the sudden drop in its share price.

Its shares have declined by almost 9% in June following reports that Credit Suisse won a pitching contest for $80 million worth of the company’s shares. Bought for $7.30 each, these shares belonged to private equity firms TPG and The Carlyle Group.

Not only was this under the current market price at the time, it put an end to any hope of an improved takeover offer from the two private equity firms.

But I believe it is onwards and upwards from here for Greencross. The company’s strategy of growth through acquisition may be slowing down a touch, but its sales certainly aren’t. In its half year results it produced company-wide like-for-like sales growth of 5.1% and gross margin improvements of 240 basis points to 55.6%.

If the company can carry this form through to its full year results then I would expect to see the share price retrace June’s declines. In my opinion, this could be a great time to invest in Greencross.

MYOB, Xero, and Greencross are great shares, but unfortunately they don't pay strong dividends at present. So if you're looking for dividends then I would highly recommend taking a look at these five fantastic shares instead.

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Motley Fool contributor James Mickleboro has no position in any stocks mentioned. The Motley Fool Australia owns shares of Xero. 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 Bruce Jackson. I contribute to The Motley Fool as a freelance writer and the thoughts and opinions in this post are my own, not that of The Motley Fool’s.

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