With earnings season on the horizon, analysts at Goldman Sachs have been looking to see which ASX 200 shares might surprise with their results.
Two ASX 200 shares that have been tipped to positively surprise next month are listed below. Here’s what the broker is expecting:
Bapcor Ltd (ASX: BAP)
Goldman Sachs believes there is upside risk to consensus estimates for this auto parts retailer in FY 2021. It notes that trading conditions remain robust and are being underpinned by continued strength in consumer spending and increased vehicle ownership.
Goldman highlights that key competitor, GPC, recently released its quarterly update and revealed same store sales growth in the mid to high teens for the June quarter. As a result, its analysts are forecasting a net profit after tax of $131 million in FY 2021, compared to the consensus estimate of $125 million. The broker’s estimate implies a 47% increase on FY 2020’s net profit after tax of $89.1 million.
Goldman Sachs has a buy rating and $9.25 price target on its shares. This compares to the latest Bapcor share price of $8.19.
Coles Group Ltd (ASX: COL)
Another ASX 200 share that Goldman Sachs believes could surprise to the upside is Coles. It notes that the supermarket giant has gone through a period of strong underlying sales growth driven by at-home consumption.
The broker’s earnings forecast remains ahead of the consensus by ~1.3%, with the positive surprise expected to be driven by the Liquor and Coles express divisions. In addition, the broker expects to see improvements in key metrics, such as ecommerce and market share, and a positive update on its Smarter Selling program.
Goldman highlights that the Coles share price trades at a significant discount to its rival Woolworths Group Ltd (ASX: WOW). It expects this to narrow as its margins improve.
Its analysts currently have a buy rating and $19.40 price target on Coles shares. This compares to the latest Coles share price of $17.57.