Brokers name 2 ASX shares with at least 30% upside potential

These ASX shares could be heading higher…

| More on:
Two brokers analysing stocks.

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

If you're looking for shares with major upside potential, then you may want to check out the ones listed below.

Earlier today, brokers gave their verdict on these shares and, pleasingly for investors, they are feeling very bullish. Here's what you need to know:

Atomos Ltd (ASX: AMS)

Morgans is very positive on this video equipment developer. This morning the broker responded to its half year results by retaining its add rating but slightly trimming its price target to $1.87. This implies almost 100% upside for the Atomos share price from current levels.

The broker commented: "AMS' 1H22 result saw a beat on EBITDA (A$3.2m vs A$2.5m MorgansE) although further upside was impacted by higher variable freight costs and supply chain disruptions – no surprise there given the global operating environment."

"While it appears the market continues to question AMS' ability to hit FY22 guidance, we look to a period of lower promotional activity, pull-through of demand from out-of-stock devices in 1H, higher contribution from 100% margin software sales, and the release of Series 2 (S2) products (higher margin) within the period, off a largely fixed cost base. We are comfortable with guidance at the lower end. We have made only marginal changes to forecasts and remain comfortable with our forecasts," it added.

Lifestyle Communities Limited (ASX: LIC)

This retirement communities company's shares could be in the buy zone according to the team at Goldman Sachs. In response to its half year update, the broker retained its conviction buy rating and lifted its price target to $24.50.

This suggests potential upside of 33% from the current Lifestyle Communities share price of $18.46.

Goldman commented: "Overall, we saw the result as very solid: LIC delivered a settlement number in line with our expectations despite ongoing lockdown conditions through the half and the number of resales continues to grow YoY. In our view, the business is well capitalised to organically increase its development pace to support a higher settlement number: although gearing reached 40% in the half, this should unwind as a number of communities move from development phase to settlement phase."

Outside this, the broker expects the company to outperform for three reasons. These are a step up in the pace of land acquisitions, structural growth in demand for land lease, and fundamental valuation support for cap rates.

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. owns and has recommended Atomos Ltd. The Motley Fool Australia has recommended Atomos Ltd. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

More on Broker Notes

Broker written in white with a man drawing a yellow underline.
Broker Notes

Leading brokers name 3 ASX shares to buy today

Here's why brokers believe that now could be the time to snap up these shares.

Read more »

A woman jumps for joy with a rocket drawn on the wall behind her.
Broker Notes

This speculative ASX stock could almost double in value

Bell Potter thinks investors could almost double their money with this high risk option.

Read more »

A man holding a cup of coffee puts his thumb up and smiles while at laptop.
Broker Notes

This ASX 200 stock's 'compelling valuation' makes it a strong buy

Goldman Sachs thinks a 50% return could be on the cards for investors.

Read more »

Red buy button on an apple keyboard with a finger on it representing asx tech shares to buy today
Broker Notes

Top brokers name 3 ASX shares to buy next week

Brokers gave buy ratings to these ASX shares last week. Why are they bullish?

Read more »

A man clenches his fists in excitement as gold coins fall from the sky.
Broker Notes

These ASX shares could rise 25% to ~50%

Big returns could await buyers of these shares according to analysts.

Read more »

A male sharemarket analyst sits at his desk looking intently at his laptop with two other monitors next to him showing stock price movements
Broker Notes

Brokers name 3 ASX shares to buy now

Here's why brokers are feeling bullish about these three shares this week.

Read more »

rising asx share price represented by man with arms raised against blackboard featuring images of dollar notes
Broker Notes

Why these 3 ASX 200 shares just earned substantial broker upgrades

Top brokers just increased their share price forecasts for these three ASX 200 shares. But why?

Read more »

Two smiling men in high visibility vests and yellow hardhats stand side by side with a large mound of earth and mining equipment behind them smiling as the Carnaby Resources share price rises today
Broker Notes

See why this broker just upgraded South32 shares to a buy

Commodity prices continue to create tailwinds for ASX stocks.

Read more »