Looking for an ASX 200 growth share or two to buy? Two that analysts at Goldman Sachs rate as buys in February are listed below.
Here's what the broker is saying about them:
ResMed Inc. (ASX: RMD)
The first ASX 200 growth share that has been tipped as a buy is ResMed. It is a medical device company with a focus on sleep treatment solutions.
Goldman Sachs is a fan of ResMed and has a buy rating and $38.00 price target on its shares. The broker likes the company due to its strong position in the sleep treatment market and its opportunity to win market share due to a competitor recall.
All in all, the broker expects double digit earnings growth through to at least FY 2026. It said:
The timing/nature of Philips' re-entry into the market remains an important debate, but under most realistic scenarios we continue to expect an excess demand dynamic through end-2023. Whilst supply shortages and cost inflation mitigated the tailwind from these competitor challenges through FY22, we believe the benefits to RMD are significant, and could continue to accrue over many years. As operational pressures continue to ease we see margin/cost dynamics improving, supporting a favourable earnings trajectory through the long term. We currently model an EPS CAGR of +11% (FY23-26E), with potential upside depending on how competitive/regulatory dynamics develop.
Xero Limited (ASX: XRO)
Another ASX 200 growth share that Goldman Sachs rates highly is Xero.
It has a buy rating and $109.00 price target on the shares of this cloud-based accounting and business platform provider to small and medium sized businesses globally.
Its analysts rate Xero highly due to its massive total addressable market (TAM) and favourable tailwinds. The broker explained:
We see Xero as very well-placed to take advantage of the digitisation of SMBs globally, driven by compelling efficiency benefits and regulatory tailwinds, with >100mn SMBs worldwide representing a >NZ$76bn TAM. Following the recent underperformance (absolute/relative), we see an attractive entry point into a compelling global growth story and our preferred large-cap technology name in ANZ, and are Buy rated (on CL).
