Are you looking for shares to add to your portfolio? Then here are two blue chips that could be worth considering.
Both are rated as buys by the team at Morgans. Here's what you need to know:
QBE Insurance Group Ltd (ASX: QBE)
Morgans is very positive on this insurance giant's shares. The broker was pleased with its first half performance and feels its shares are trading at an attractive level.
It commented: "We see QBE as likely having positive underlying momentum into next year. QBE has been putting through top-line rate increases of around 9%, which should assist margin expansion into FY22. With QBE's balance sheet recently reset, pricing tailwinds evident and the stock relatively inexpensive trading on ~13.5x FY22F PE."
The broker currently has an add rating and $13.70 price target. This compares to the latest QBE share price of $11.72, which implies potential upside of 17% over the next 12 months. Morgans is also forecasting a 5.5% dividend yield next year.
Santos Ltd (ASX: STO)
The broker also believes the Santos share price is in the buy zone at the current level. This is due to its growth prospects and diversified earnings.
The broker explained: "We expect the resilience of STO's growth profile and diversified earnings base see it best placed to outperform against a backdrop of a continuing broader sector recovery. While pre-FEED, we see Dorado as likely to provide attractive growth for STO, while its recent acquisition increasing its stake in Darwin LNG has increased our confidence in Barossa's development."
Morgans currently has an add rating and $8.55 price target on the company's shares. This compares very favourably to the latest Santos share price of $6.74, which implies potential upside of 27% over the next 12 months. The broker also estimates that its shares offer a 2% dividend yield at current prices.
