The ASX 200 is within an arms reach of its pre-COVID highs. As ASX 200 shares continue to grind higher, here are the ones that brokers think can outperform the market.
ASX 200 shares that could beat the market
1. Eagers Automotive Ltd (ASX: APE)
Positive automotive data such as used car sales and increased driving as well as hygiene concerns on public transport has helped fuel a bullish run for ASX-listed automotive shares such as Bapcor Ltd (ASX: BAP), ARB Corporation Limited (ASX: ARB) and Super Retail Group Ltd (ASX: SUL).
On Monday, Morgan Stanley, Morgans and UBS released positive notes for Eagers shares with a respective overweight, add and buy rating. The brokers highlight a positive first-quarter update from last week, observing continued demand for vehicles and supply tightness. The average target price between the three brokers is $17.10.
Credit Suisse was the only neutral rated broker, citing that its strong start to 2021 does not necessarily note any change in confidence in the medium to long term.
Eagers Automotive shares have surged 4.57% on Monday to a high of $16.25.
2. BlueScope Steel Limited (ASX: BSL)
BlueScope has continued to build momentum in its earnings across all key business segments. The company has seen strong volumes and improving steel spreads in its largest steel-making business in Australia, while other regions including the United States, India, China and New Zealand continue to record strong earnings improvements.
This translated to $530.6 million in underlying earnings before interest, taxes, depreciation, and amortization (EBITDA) in the first half, up 78% on 1H20 and double that of 2H20.
Credit Suisse is bullish on BlueScope shares with an outperform rating and $22.50 target price. The broker increased its FY21-22 operating income forecasts by 7-8% based on higher steel spreads in Australia and the US.
The BlueScope share price closed today at $21.40, up 2.2%.
3. Hub24 Ltd (ASX: HUB)
Hub24 continues to disrupt the investment and superannuation portfolio administration space, growing its market share from 1.6% to 2.3% in the first half. The company has a two-year compound annual growth rate of 48% for platform funds under management, maintaining its position as second for annual net inflows amongst competitors.
Citi is forecasting net inflows of $1.9 billion in the third quarter, up 39% on the previous corresponding period. The broker believes Hub24 could overtake NetWealth Group Ltd (ASX: NWL).
The broker rates Hub24 shares as a buy with a $26.00 target price. Hub24 shares are currently fetching $24.28.