Are you interested in adding some ASX 200 growth shares to your portfolio this month? If you are, you may want to look at the two listed below that have recently been named as buys by Goldman Sachs.
Here's what the broker is saying:
Breville Group Ltd (ASX: BRG)
The first ASX 200 growth share that Goldman Sachs rates as a buy is Breville. It is the kitchen appliance manufacturer behind a growing portfolio of brands such as Breville, Kambrook, Lelit, and Sage.
Breville has been an impressive performer over the last decade, delivering strong sales and profit growth and stellar returns for investors. This has been driven by its earnings accretive acquisitions, international expansion, and consistent investment in research and development.
Goldman Sachs believes this solid growth can continue and is forecasting an earnings before interest, tax, depreciation and amortisation (EBITDA) compound annual growth rate of 7% between FY 2023 and FY 2025. It recently commented:
We see BRG as having a three-pronged growth strategy: 1) building on secular growth of the portioned and roast & ground (R&G) coffee market and achieving market share gains; 2) new market entry; and 3) options – ecosystem revenue streams.
Goldman has a buy rating and $24.70 price target on its shares.
IDP Education Ltd (ASX: IEL)
Another ASX 200 growth share that Goldman Sachs is tipping as a buy is IDP Education.
This language testing and student placement company is the co-owner of the IELTS test, which is the English test trusted by more governments, universities and organisations than any other.
While demand for testing and student placement services softened during the pandemic, it has rebounded very strongly over the last 12 months. This led to the company recording stellar sales and profit growth for FY 2022.
Goldman Sachs is confident that IDP's growth can continue in the coming years. This is thanks partly to strong underlying system demand. It commented:
IEL is trading c.40% below its 5-yr average P/E premium to the ASX200 Industrials with a forecast 37% FY22-25E EPS CAGR, we remain Buy-rated. We have upgraded EPS in FY23/FY24 by 1.7%/0.8% on the back of the stronger FY22 result, continued strong revenue growth and margin expansion. The balance sheet is in a resilient position with c.A$40mn of net cash to facilitate any bolt-on acquisitions or ramp up in organic investment in new offices and technology.
Goldman has a buy rating and $35.50 price target on the company's shares.
