The ASX 50 index is home to many of the highest quality companies that the ANZ region has to offer. And while not all shares in the index are necessarily in the buy zone, two that could be are listed below.
Here’s why analysts rate these ASX 50 shares as buys:
Cochlear Limited (ASX: COH)
The first ASX 50 share to look at is Cochlear. It is one of the world’s leading hearing solutions companies with a portfolio of industry-leading cochlear implant products. These include its Nucleus System and the Baha System.
But management isn’t resting on its laurels with these products. It continues to spend 12%-14% of its revenue each year on research and development. This is a significant spend and demonstrates the implant industry’s high barriers to entry and the competitive moat created by Cochlear through decades of R&D.
All in all, this leaves the company well-positioned to benefit from the ageing population tailwind over the 2020s and beyond.
Macquarie currently has an outperform rating and $256.00 price target on the company’s shares. This compares favourably to the latest Cochlear share price of $216.66.
Xero Limited (ASX: XRO)
Another ASX 50 share that could grow at a solid rate long into the future is Xero. It is a provider of a cloud-based business and accounting solution to small and medium sized businesses.
Thanks to its international expansion, acquisitions, the transition to the cloud, and its burgeoning app ecosystem, the team at Goldman Sachs believe Xero has multi-decade runway for growth. Especially if it can monetise its App Store successfully.
In light of this, it will come as no surprise to learn that Goldman Sachs is bullish on Xero. It currently has a buy rating and $158.00 price target on the company’s shares. This compares to the latest Xero share price of $142.06.