2 top ASX 200 shares that might be buys today

Wesfarmers is one of the ASX 200 shares that could be worth owning today….

| More on:
asx blue chip shares represented by pile of blue casino chips in front of bar graph

Image source: Getty Images

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

The S&P/ASX 200 Index (ASX: XJO) shares in this article might be good considerations to think about today.

Businesses in the ASX 200 are often among the biggest and strongest in their industry.

The two investments below are ones that may be able to deliver growth over the long term:

Wesfarmers Ltd (ASX: WES)

Wesfarmers is a diversified business that has been operating for decades. It has some market-leading retailers including Bunnings, Kmart, Officeworks, and Catch. The ASX 200 share also has other operations including Target, a lithium project, and various industrial businesses and investments.

The business showed how much essential consumer demand there is for its businesses including Bunnings, Officeworks, and Catch. Wesfarmers was able to capitalise on the COVID-19 era demand.

While people aren't doing as many home projects or buying home office equipment, Wesfarmers is still experiencing higher demand than pre-COVID times.

It's regularly adding to its portfolio to diversify its future profit. For example, Bunnings bought Beaumont Tiles. Wesfarmers is progressing with its Mt Holland lithium project. The latest attempt by the company is to try to buy Australian Pharmaceutical Industries Ltd (ASX: API). It's in a battle with Sigma Healthcare Ltd (ASX: SIG) for API.

Wesfarmers says while it plans to invest in the API business, it would also provide the basis of a new healthcare division of Wesfarmers and a platform from which to invest and develop capabilities in the growing health, wellbeing, and beauty sector.

According to Commsec, it is valued at 30x FY22's estimated earnings with a projected grossed-up dividend yield of 4.3%.

Fortescue Metals Group Limited (ASX: FMG)

Fortescue is one of the largest iron ore miners in the world.

Citi is one of the brokers that currently rates Fortescue as a buy, with a price target of $18.50. That implies a potential rise of close to 30% over the next year, if the broker is right.

The Fortescue share price is now a lot lower after a sharp decline in the iron ore price. The ASX 200 share has seen a decline of around 40% over the last three months.

Fortescue continues to produce enormous amounts of iron ore. In the first quarter of FY22, Fortescue shipped 45.6mt of iron ore, which was a 3% increase compared to the same period last year.

The average revenue was US$118 per dry metric tonne, while the C1 cost was US$15.25 per wet metric tonne (in line with the previous quarter).

Fortescue is making a number of headlines with its Fortescue Future Industries (FFI) division.

The goal of the ASX 200 share is for FFI is to take a global leadership position in the renewable energy and green products industry. It has a vision of making green hydrogen the most globally traded seaborne commodity in the world.

One of the key developments relates to the planned construction of the global green energy manufacturing centre in Gladstone, Queensland. The first stage of development is an electrolyser factory with an initial capacity of two gigawatts. It has also signed a letter of intent with Plug Power for a joint venture with the two-gigawatt electrolyser factory, with the ability to expand into fuel systems and other hydrogen-related refuelling and storage infrastructure in the future.

Fortescue Future Industries has also signed an agreement with JCB and Ryze hydrogen to become the UK's largest supplier of green, renewable hydrogen. JCB and Ryze will purchase 10 per cent of FFI's global green hydrogen production.

Motley Fool contributor Tristan Harrison owns shares of Fortescue Metals Group Limited. 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 Wesfarmers Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

More on Blue Chip Shares

Person holding a blue chip.
Blue Chip Shares

2 ASX blue-chip shares I'd buy with $3,000 right now

These are large businesses with compelling futures.

Read more »

a man looks down at his phone with a look of happy surprise on his face as though he is thrilled with good news.
Blue Chip Shares

Why this could be one of the best blue chip ASX shares to buy right now

Morgans sees this blue chip as a best idea for investors right now.

Read more »

a man in a business suite throws his arms open wide above his head and raises his face with his mouth open in celebration in front of a background of an illuminated board tracking stock market movements.
Blue Chip Shares

Buy these ASX 200 blue chip shares for big returns

Analysts think these blue chips could be in the buy zone according to analysts.

Read more »

A couple are happy sitting on their yacht.
Opinions

Top ASX shares to buy instead of a term deposit in March 2024

You may have to weather the odd storm, but the long-term investment outlook looks fine!

Read more »

Happy woman looking for groceries. as she watches the Coles share price and Woolworths share price on her phone
Blue Chip Shares

Why Coles shares could be a best buy for blue chip investors

Bell Potter thinks Coles is the best supermarket to buy this month.

Read more »

Three excited business people cheer around a laptop in the office
Blue Chip Shares

2 powerful blue chip ASX 200 shares to buy for your portfolio

Analysts think these high-quality companies could give your portfolio a big boost.

Read more »

A little boy holds his fingers to his head posing as a bull.
Blue Chip Shares

Here are 2 high-quality ASX 200 blue chip shares that analysts are bullish on

These blue chips have been given a big thumbs up.

Read more »

Woman smiling with her hands behind her back on her couch, symbolising passive income.
Blue Chip Shares

This is the ASX blue-chip share I'd buy for dividend income

Here’s why I love this stock for payouts.

Read more »