If you’re wanting to load up on blue chip shares following the market selloff, then look no further.
Listed below are two ASX 200 blue chips that Goldman Sachs rates as buys. Here’s what it is saying:
REA Group Limited (ASX: REA)
The first blue chip ASX 200 share for investors to consider buying is REA. It is the operator of realestate.com.au, which is the dominant player in real estate listings in the Australian market.
It could be a top option for investors due to the recent pullback in its share price, which has come despite management’s positive outlook commentary. REA recently stated that it remains confident it can achieve double digit revenue/EBITDA growth through the cycle.
This went down well with the team at Goldman Sachs, which has a buy rating and $167.00 price target on its shares. Based on the current REA share price of $103.44, this implies potential upside of 61% for investors.
Overall, we believe these commitments illustrate the pricing power of REA, pipeline of value-add products, and its ability to offset any potential macro weakness, and now forecast FY22-24E Sales growth of 10% despite challenging volume listings.
Woolworths Group Ltd (ASX: WOW)
Another ASX 200 blue chip share that could be in the buy zone is Woolworths. It is of course the retail giant behind the eponymous Woolworths supermarket and Big W brands.
The team at Goldman Sachs is very positive on the company’s outlook even in the current environment. It recently reiterated its buy rating and $41.70 price target on the company’s shares. Based on the current Woolworths share price of $33.83, this implies potential upside of 23% for investors.
Goldman is forecasting solid sales and earnings growth through to FY 2024. It explained:
We are encouraged by the resilience and superior operations of WOW and reiterate our unchanged FY22-24e Sales and EPS CAGR of 6.9% and 14.9% respectively. We expect this to be driven by high price growth, well protected GPM and slight EBIT margin expansion as COVID costs roll-off and cost efficiencies continue.