Over the past couple of days we have been looking at the ASX shares that Morgans has named as its best ideas for February.
These are the shares it believes offer the highest risk-adjusted returns over a 12-month timeframe and are supported by a higher-than-average level of confidence.
We've previously looked at financial shares (here) and resources shares (here). Whereas today, let's round things up with four more shares across several sectors. Here are the picks:
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ResMed Inc (ASX: RMD)
This sleep treatment specialist makes Morgans list. It has an add rating and $40.46 price target on its shares.
While the broker acknowledges that COVID could make the near term volatile, that doesn't change its "medium/longer term view that the company remains well-placed as it builds a unique, patient-centric, connected-care digital platform that addresses the main pinch points across the healthcare value chain."
Tabcorp Holdings Limited (ASX: TAH)
This gaming and gambling company's shares are rated highly by Morgans. The broker has an add rating and $5.70 price target on them.
The broker explained: "We continue to view the risk/return profile of TAH as asymmetrically skewed to the upside over the next ~12 months as the demerger of the high quality, infrastructure-like Lotteries & Keno business progresses."
Morgans believes this business will trade on higher multiples once operating on a standalone basis.
Transurban Group (ASX: TCL)
Morgans has this toll road operator on its best ideas list. Its analysts currently have an add rating and $14.57 price target on its shares. The broker likes the company due to the high quality of its assets, management team, balance sheet, and growth prospects. In addition, Morgans appears confident Transurban's dividends will grow quickly post-COVID.
Its analysts commented: "Watch for rapid recovery in DPS alongside traffic recovery and WestConnex acquisition prospects."
Wesfarmers Ltd (ASX: WES)
Finally, Morgans is a fan of this conglomerate and has an add rating and $60.80 price target on its shares. The broker believes it has one of the highest quality retail portfolios in Australia, which are being led by a highly regarded management team. In light of this, it feels recent weakness in the Wesfarmers share price could be a buying opportunity.
It said: "While COVID-related staff shortages are proving to be a challenge, the core Bunnings division (>60% of group EBIT) remains a solid performer as consumers continue to invest in their homes. We see the recent pullback in the share price as a good entry point for longer term investors."
