With a new month upon us, what better time to see if your portfolio could do with some new additions.
Below are 10 quality ASX shares which have been tipped as buys. Here’s why they could be worth a closer look:
a2 Milk Company Ltd (ASX: A2M)
A2 Milk Company is one of the region’s leading infant formula and fresh milk companies. It has been growing at a very strong rate over the last few years. And while FY 2021 is going to be a very tough year due to the pandemic, analysts at Macquarie expects its growth to resume in FY 2022. It has an outperform rating and $17.95 price target on its shares.
Altium Limited (ASX: ALU)
Altium is an award-winning printed circuit board (PCB) design software provider. Over the last few years it has carved out a leading position in this growing market. It is now aiming to take things to the next level and dominate the market with its cloud-based Altium 365 product. One broker that likes what it sees here is Credit Suisse. Last week it initiated coverage on Altium with an outperform rating and $42.00 price target.
Appen Ltd (ASX: APX)
Appen is a leading developer of high-quality, human annotated datasets for machine learning and artificial intelligence (AI). Its team of over a million contractors prepare or create the data for the machine learning models of some of the largest tech companies. This includes Facebook and Microsoft to name just two. Analysts at Morgan Stanley have an overweight rating and $40.00 price target on its shares. The broker has confidence in the company’s long term growth potential.
Aristocrat Leisure Limited (ASX: ALL)
Aristocrat Leisure is one of the world’s leading gaming technology companies. While 2020 has been a difficult year for its poker machine business, its digital business has flourished and delivered strong growth. Analysts at Citi believe it will bounce back in FY 2021. After which, they feel it is well-placed for growth over the medium term. As a result. they have recently retained their buy rating and lifted the price target on its shares to $40.60.
CSL Limited (ASX: CSL)
CSL is one of the world’s leading biotechnology companies. It is comprised of the CSL Behring business and the Seqirus business. CSL Behring is the global number one player in a plasma therapies industry worth a massive US$30 billion per year. Whereas Seqirus is now the number two player in the US$6 billion global influenza vaccines industry. Analysts at UBS looked over its research and development pipeline recently and appear to have been impressed. They put a buy rating and $346.00 price target on its shares. Its analysts note that product development has been a key driver of growth and appear confident this trend will continue in the future.
Nanosonics Ltd (ASX: NAN)
Nanosonics is the infection control specialist behind the industry-leading trophon EPR disinfection system for ultrasound probes. This system has been growing its footprint at a strong rate over the last few years. This is great for two reasons. One is unit sales, the other is the recurring revenue it generates from the consumables the system requires. Earlier this month analysts at UBS retained their buy rating and $7.20 price target on its shares. The broker believes Nanosonics is an example of a high-quality structural growth story, particularly in a post-COVID world.
NEXTDC Ltd (ASX: NXT)
NEXTDC is a leading data centre operator which has been delivering strong revenue and earnings growth in recent years thanks to increasing demand for capacity in its centres. This has been driven by the structural shift to the cloud, which has accelerated during the pandemic. Goldman Sachs is very positive on its outlook and recently reiterated its buy rating and $13.20 price target. It even suggested the NEXTDC share price could go to $20.00 based on high but not unrealistic assumptions.
Pushpay Holdings Group Ltd (ASX: PPH)
Pushpay is a fast-growing donor management and community engagement platform provider for the faith sector. It has been a very strong performer this year and recently reported a 53% increase in half year operating revenue to US$85.6 million. Even if you annualise this revenue to US$171.2 million, it is still well short of management’s long term revenue target of US$1 billion. Analysts at Goldman Sachs are bullish on its growth prospects. They have a conviction buy rating and $10.35 price target on its shares.
REA Group Limited (ASX: REA)
REA Group is the dominant player in real estate listings in the Australian market. Although times have been hard for the company because of the pandemic, its excellent costs control has limited the damage. Pleasingly, with the housing market tipped to bounce back, it looks well-placed to benefit from a return to listings growth next year. In addition to this, price increase and flat costs are likely to support its growth. That’s the view of Morgan Stanley, which has an overweight rating and $150.00 price target on its shares.
ResMed Inc. (ASX: RMD)
ResMed is a medical device company with a focus on the sleep treatment market. It has been growing at a consistently strong rate over the last decade thanks to its industry-leading products and sizeable market opportunity. The good news is that its market opportunity is still growing. Management estimates that there are ~1 billion people suffering from sleep apnoea worldwide and only ~20% of these sufferers have been diagnosed. Following the release of its first quarter update last month, analysts at Morgans retained their add rating and lifted their price target to $30.99.
Where to invest $1,000 right now
When investing expert Scott Phillips has a stock tip, it can pay to listen. After all, the flagship Motley Fool Share Advisor newsletter he has run for more than eight years has provided thousands of paying members with stock picks that have doubled, tripled or even more.*
Scott just revealed what he believes are the five best ASX stocks for investors to buy right now. These stocks are trading at dirt-cheap prices and Scott thinks they are great buys right now.
*Returns as of June 30th
James Mickleboro owns shares of NEXTDC Limited. 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, CSL Ltd., Nanosonics Limited, and PUSHPAY FPO NZX. The Motley Fool Australia owns shares of and has recommended A2 Milk. The Motley Fool Australia has recommended Nanosonics Limited, PUSHPAY FPO NZX, REA Group Limited, and ResMed Inc. 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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