Why brokers think these 3 top performing ASX 200 shares can beat the market

The ASX 200 is within an arms reach of its pre-COVID highs. Here are the ASX 200 shares brokers think can beat the market.

| More on:
Three brightly coloured objects against a backdrop of blue, indication three winning ASX share prices

Image source: Getty Images

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.

Wondering where you should 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 could be the five best ASX stocks for investors to buy right now. These stocks are trading at near dirt-cheap prices and Scott thinks they could be great buys right now.

*Returns as of May 24th 2021

Kerry Sun has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. owns shares of Hub24 Ltd. The Motley Fool Australia owns shares of and has recommended Bapcor. The Motley Fool Australia owns shares of Netwealth. The Motley Fool Australia has recommended ARB Limited and Hub24 Ltd. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

More on Broker Notes