2 ASX shares that many brokers think could be buys

Credit Corp and Monash IVF are two ASX shares that a few brokers like.

| More on:
ASX 200 mining shares to buy A clockface with the word 'Time to Buy'

Image source: Getty Images

There are a small number of ASX shares that many brokers like at the same time.

It might indicate that there is an opportunity with these businesses because brokers are constantly on the lookout for ideas. If they all like a company, then perhaps it’s an obvious idea. Or maybe they’re all wrong at the same time. Only time will tell.

Here are two of those businesses:

Credit Corp Group Limited (ASX: CCP)

Credit Corp is a large debt collector in Australia and it has quickly-growing US operations as well.

It’s currently rated as a buy by at least three brokers. One of the brokers that likes Credit Corp is Morgans, which has a price target of $33.45 on the business. That suggests the Credit Corp share price could rise by more than 15% over the next 12 months.

The broker is expecting a strong profit result when Credit Corp reveals its FY21 report. It also thinks there is more PDL (purchased debt ledger) growth to come over the next 12 months. The US presents a good chance to increase its penetration in that market.

At the end of April 2021, the business gave an update. It suggested that it’s expecting a return to its pre-COVID growth trajectory of net profit and with its return on assets (ROA).

This growth could be delivered despite challenging debt buying market conditions, with a temporary reduction in market sale volumes of around 50% in both the domestic markets and the US.

However, at the time of the update, there were early indications of a recovery in sales volumes for the ASX share. A major Australian bank’s forward flow volume was up 50% on the run rate in April. There had also been a strong US credit growth rebound.

Credit Corp says that it has the capacity to increase investment as opportunities arise with cash and undrawn lines of around $400 million. It’s already the sixth largest debt buyer in the US market.

Current FY21 net profit guidance is for a range of between $85 million to $90 million.

Monash IVF Group Ltd (ASX: MVF)

Monash IVF is another ASX share that is liked by several brokers. It’s a business that specialises in fertility treatments. It is rated as a buy by the broker Macquarie Group Ltd (ASX: MQG) which has a price target of $1 on the business. That suggests it could rise by around 15% over the next 12 months, if Macquarie is right.

Macquarie thinks things could turn around for Monash with more fertility activity expected. Research and development spending could help it achieve better success rates over time.

In the FY21 half-year result, Monash IVF said that it made $14.6 million of statutory profit, up 78.5% year on year. Underlying net profit was $12 million, up 32%.

The first six months of FY21 saw Australian stimulated cycle growth of 27.4% thanks to the pent-up demand that was created during the temporary suspension of services in the final quarter of FY21. In the second quarter it saw cycle growth of 33.1% because of national industry growth of 20.6% and market share gains in Victoria, NSW and Queensland.

Monash IVF also said that solid progress is being made in southeast Asia with its expansion plans. There was 6.6% growth of Kuala Lumpur stimulated cycles.

The ASX share recommenced dividends, with improved operating cashflow generation. Management also said that the balance sheet is well positioned for future organic growth. The balance sheet can support strategic infrastructure projects according to the company.

Should you invest $1,000 in right now?

Before you consider , you'll want to hear this.

Motley Fool Investing expert Scott Phillips just revealed what he believes are the 5 best stocks for investors to buy right now... and wasn't one of them.

The online investing service he’s run for nearly a decade, Motley Fool Share Advisor, has provided thousands of paying members with stock picks that have doubled, tripled or even more.* And right now, Scott thinks there are 5 stocks that are better buys.

*Returns as of August 16th 2021

Motley Fool contributor Tristan Harrison has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of and has recommended Macquarie Group Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

More on Share Market News