It certainly has been another busy week for results releases, with a number of high profile companies unveiling their latest numbers.
Two ASX 200 shares that impressed analysts at Goldman Sachs are listed below. Here's why the broker believes they are post-results buys:
IDP Education Ltd (ASX: IEL)
Goldman Sachs believes that this language testing and student placement company is an ASX 200 share to buy.
Although IDP's earnings were a touch short of expectations, the broker was impressed with its strong revenue growth and operating leverage. Its analysts believe there's plenty more to come and are forecasting strong growth out to at least FY 2025.
In light of this, it has reiterated its buy rating with a $35.70 price target. The broker commented:
While the 1H23 result was modestly below our EBIT forecast (-4%) the company delivered strong revenue growth (+26%) and operating leverage (EBIT margin +476 bps). We expect double digit revenue growth and c.200bps p.a. of EBIT margin expansion to continue over the forecast period, justifying the stock's premium rating. Our revised $35.70 TP is based on DCF and implies 25% total return to last close. We maintain our Buy rating.
Qantas Airways Limited (ASX: QAN)
Another ASX 200 share that Goldman believes is a buy is airline operator, Qantas.
Goldman was impressed with its performance during the first half and expects more of the same in the second half. And while it suspects that airfares may now have peaked, it doesn't expect that to prevent strong earnings through to at least FY 2025.
In fact, the broker believes this will position Qantas to undertake an $800 million on-market share buy-back next year.
As a result, the broker has retained its conviction buy rating with an $8.30 price target. It commented:
Fares (and therefore unit revenues) may have peaked (we forecast a 15% yoy unit revenue decline in FY24e representing a c2.5% CAGR vs FY19). However, we believe QAN's earnings capacity has reset. Declines in unit revenues are tied to and mitigated by higher capacity. This is complemented by roll-off of significant transitional costs ($400m in FY23), reiterated by management. This is the key driver of the 9% uplift in our FY24e PBT forecast. We note that our FY24e EBIT margin of 12.4% compares with an estimated ~13% implied by management's profitability targets. Beyond this, we incorporate continued capital management ($800m buyback in FY24e), noting that ND would be below management's target range that is likely to increase over time. This translates into a 13% uplift in EPS to 94c (flat yoy).
