The team at Morgans has been busy picking out its best ASX 200 share ideas for April.
These are the shares that its analysts think offer the highest risk-adjusted returns over a 12-month timeframe. They are also supported by a higher-than-average level of confidence.
The first two ASX 200 shares we looked at can be found here. Read on for three more picks:
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Endeavour Group Ltd (ASX: EDV)
The first ASX 200 share that Morgans has on its best ideas list this month is drinks company Endeavour. The broker has an add rating and $7.80 price target on its shares. Its analysts like the company due to its leadership position and easing regulatory issues. Morgans commented:
We believe concerns around gaming regulatory changes with the potential introduction of cashless gaming cards in NSW have eased following the Labor election victory given the party's stance on the issue was less onerous than the Liberals. Notwithstanding external factors, EDV's underlying business remains strong with a broad network of retail liquor stores/hotel venues, well-known brands (eg, Dan Murphy's and BWS) and dominant market positions.
Nextdc Ltd (ASX: NXT)
Another ASX 200 share that could be a top option for investors is this data centre operator. Morgans currently has an add rating and $13.00 price target on its shares. The broker believes structural tailwinds will drive strong earnings growth over the coming years. It explained:
Structural demand for cloud and colocation remains incredibly strong. NXT's new S3 and M3 data centres are now open. Consequently, we expect significant new customer wins over the next six to twelve months (including CSP options being exercised). Sales should drive the share price higher. NXT looks comfortably on-track to generate over $300m of EBITDA in the next three to five years.
Xero Limited (ASX: XRO)
Morgans is bullish on this cloud accounting platform provider and has an add rating and $97.00 price target on its shares. The broker believes recent share price weakness has created a rare buying opportunity for investors. It commented:
XRO is a high quality cash generative business with impressive customer advocacy and duration. Over the last 12 months rising interest rates and competition have made things harder for Xero. However, we see the current shortterm weakness as a rare opportunity to buy a high quality global growth company at a discount to the life time value of its current customer base.
