There are plenty of blue chip ASX 200 shares to choose from on the Australian share market.
But three of the best, according to Morgans, are listed below. Here's why the broker thinks highly of these blue chips:
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Treasury Wine Estates Ltd (ASX: TWE)
This global wine giant could be an ASX 200 share to buy according to Morgans. Its analysts believe the company is well-placed for strong growth over the next few years thanks to a recent restructure. Morgans said:
TWE owns much loved iconic wine brands, the jewel in the crown being Penfolds. We rate its management team highly. The foundations are now in place for TWE to deliver strong earnings growth from the 2H22 over the next few years. Trading at a material discount to our valuation and other luxury brand owners, TWE is a key pick for us.
Morgans has an add rating and $15.71 price target on the wine company's shares.
Wesfarmers Ltd (ASX: WES)
Another ASX 200 share that the broker rates highly is Bunnings and Kmart owner Wesfarmers. Morgans likes the conglomerate due to its highly regarded management team and strong retail portfolio. It said:
WES possesses one of the highest quality retail portfolios in Australia with strong brands including Bunnings, Kmart and Officeworks. The company is run by a highly regarded management team and the balance sheet is healthy. We believe WES's businesses, which have a strong focus on value, remain well-placed for growth despite softening macro-economic conditions.
The broker has an add rating and $55.60 price target on its shares.
Westpac Banking Corp (ASX: WBC)
Finally, this banking giant could be an ASX 200 share to buy according to Morgans. Its analysts are positive on Australia's oldest bank due its return on equity improvement potential, which is being underpinned partly by its bold cost cutting plans. Morgans explained:
We view WBC as having the greatest potential for return on equity improvement amongst the major banks if its business transformation initiatives prove successful. The sources of this improvement include improved loan origination and processing capability, cost reductions (including from divestments and cost-out), rapid leverage to higher rates environment, and reduced regulatory credit risk intensity of non-home loan book. Yield including franking is attractive for income-oriented investors, while the ROE improvement should deliver share price growth.
Its analysts have an add rating and $25.80 price target on Westpac's shares.
