If you're looking for some new portfolio additions, then read on.
Listed below are two ASX shares that analysts at Morgans are bullish on. Here's what the broker is saying about them:
PWR Holdings Ltd (ASX: PWH)
Analysts at Morgans remain bullish on this automotive products and solutions provider's shares.
Its analysts highlight that PWR delivered a result ahead of estimates in FY 2022. And with the company sitting on an ample cash balance, it feels management can invest further to support its future growth.
In response to its results, the broker retained its add rating and lifted its price target to $10.50. Based on the current PWR share price of $9.11, this implies potential upside of 15% for investors.
The broker commented:
PWH's FY22 result was comfortably ahead of expectations with revenue surpassing $100m for the first time. Key positives: All segments delivered revenue growth – Motorsports +11%, OEM +53%, Aftermarket +4%, Emerging Tech +124%; Balance sheet remains very healthy with cash of $21.5m and no debt leaving plenty of capacity for further investment for growth.
Our target price rises to $10.50 and we maintain our Add rating. We believe the outlook remains strong with PWH's ongoing investment in people, capability and capacity giving us confidence in the pipeline of future opportunities.
SEEK Limited (ASX: SEK)
Morgans is a fan of this job listings company following the release of its full year results.
In response to the release, the broker upgraded Seek's shares to an add rating with a $29.40 price target. Based on the current Seek share price of $21.65, this implies potential upside of over 35%.
It believes the company is well-placed for growth thanks partly to its pricing power. It commented:
It was a strong FY22 result overall in our view, however additional IT project spend (platform unification) was a surprise to a degree. We lower our FY23-FY25 EPS estimates by ~7-14% factoring in the provided guidance, additional incremental IT investment spend, and further conservatism around opex normalisation/spend over our forecast period. Our price target is lowered $29.40 on the above changes. Whilst we expect job ad volume growth to normalise, we believe SEEK has levers to pull (i.e. price) to continue to drive yield. We move to an ADD recommendation.
