The Motley Fool

Top broker tipping this mid-cap stock is set to race to new record highs next month

The share price of Idp Education Ltd (ASX: IEL) has hit fresh record highs this morning but the stock has more room to climb in the short-term if Morgan Stanley is to be believed.

The stock added 0.7% in early trade to $8.79 following last week’s announcement that the international student placement services group will replace takeover target Mantra Group Ltd (ASX: MTR) on the S&P/ASX 200 (Index:^AXJO) (ASX:XJO) from this Thursday.

That inclusion of IDP Education into the market benchmark is the basis for Morgan Stanley’ bullish call with the broker estimating that there is an 80% plus chance of the stock hitting further new record highs over the next 30 days.

“We estimate passive demand from index trackers which follow the [S&P/ASX] 200 to be circa A$42.3 million in value to trade with approximately 5 million shares traded,” said the broker, which has tagged the stock with an “outperform” recommendation.

This flood of fresh capital going into the stock is likely to push IDP Education closer to the broker’s price target of $9.65 a share.

IDP Education has already been running well ahead of the broader market as it’s seen as one of the best ways for investors to gain exposure to the booming international student market here, although the company also places students in educational institutions in other western countries like the United States and United Kingdom as well.

Strong demand for a western education from students in rising Asian economies like China helped lift IDP Education’s first half revenue by 29% to $242 million and earnings before interest, tax, depreciation and amortisation (EBITDA) by a third to $50.3 million.

The company looks well placed to continue benefiting from this thematic and the falling Australian dollar will also help.

In some respects, IDP Education shares common traits with Sydney Airport Holdings Pty Ltd (ASX: SYD), which is another stock that is benefiting from a boom in overseas demand for the Aussie experience.

The performance of IDP Education stands in contrast to its struggling peer Navitas Limited (ASX: NVT) with shares in the former surging 89% over the past year when Navitas is flat and the ASX 200 is up around 5%.

It isn’t only Morgan Stanley who is recommending investors buy the stock. Of the eight brokers covering the company (including Morgan Stanley), five have a “buy” recommendation on IDP Education.

But IDP Education isn’t the only stock that is poised for greatness. The experts at the Motley Fool have uncovered three gems that they believe will outperform the market in 2018 and beyond.

Follow the free link below to find out what these stocks are and why they should be on your radar this year.

The Disruptors: 3 Revolutionary Aussie Companies to Back for 2018

We’re living in one of the most exciting times in investing history. Innovation and a booming culture of entrepreneurship are constantly creating new companies with the potential to make forward-thinking investors very rich. Now more than ever, one small, smart investment could make a huge difference to your wealth.

That’s why at The Motley Fool we’ve been scrutinizing the ASX to uncover the kinds of companies that we believe could turn into the next Cochlear or REA Group.

We’ve found three exciting companies that we believe re poised to perform in the new year. Click here to uncover these ideas!

Motley Fool contributor Brendon Lau has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of and has recommended Sydney Airport 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.

One ASX Stock For An Estimated $US22 Billion Marijuana Market

A little-known ASX company just unlocked what some experts think could be the key to profiting off the coming marijuana boom.

And make no mistake – it is coming. To the tune of an estimated $US22 billion.

Cannabis legalisation is sweeping over North America, and full legalisation arrived in Canada in October 2018.

Here’s the best part: we think there’s one ASX stock that’s uniquely positioned to profit immensely from this explosive new industry… taking savvy investors along for what could be one heck of a ride.

AND, this is the first time The Motley Fool Australia has EVER put a BUY recommendation on a marijuana stock.

Simply click below to learn more on how you can profit from the coming cannabis boom.

Click here to find out more