Are you looking for some ASX growth shares to buy?
If you are then you might want to hear what Morgans is saying about the two listed below.
Here's why the broker thinks they could be in the buy zone:
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Webjet Limited (ASX: WEB)
Morgans responded to this online travel booking company's half-year results by putting an add rating and $8.55 price target on its shares.
Based on the current Webjet share price of $6.66, this implies a potential upside of 28% for this ASX growth share over the next 12 months.
The broker was impressed with its performance during the half and believes there's a lot more to come. It commented:
Webjet reported a strong 1H24 result which beat expectations. The performance from WebBeds which posted a record result (bookings are 50% ahead of pre-COVID levels), its industry leading margins and strong operating cashflow were the highlights of the result.
Outlook commentary was upbeat, however the war has had an impact on bookings in the last six weeks. FY24 EBITDA guidance was in line with our forecast however if the impact from the war is short lived, it could prove conservative. With plenty of market share still to win, we maintain an Add rating on this high quality growth stock.
Treasury Wine Estates Ltd (ASX: TWE)
Another ASX growth share that has been given the thumbs up by Morgans is Treasury Wine.
Its analysts have an add rating and a $14.15 price target on the wine giant's shares. This suggests a potential upside of 33% for investors from current levels.
The broker is supportive of its recent acquisition in North America and has boosted its earnings estimates to reflect this. It said:
Treasury Wine Estates has announced the acquisition of Paso Robles luxury wine business, DAOU Vineyards (DAOU) for US$900m (A$1.4bn), funded by equity and debt. The acquisition is in line with TWE's premiumisation and growth strategy and will strengthen a key gap in Treasury Americas (TA) portfolio. Importantly, DAOU has generated solid earnings growth and is a high margin business.
TWE has consequently upgraded its margins targets. The acquisition is EPS accretive from FY25 and +US$20m of cost synergies are expected by FY26. We have upgraded our forecasts. On an FY25F PE of 17.5x, TWE is trading at a material discount to its 5-year average of ~25x and we maintain an Add rating. The key near term catalyst is China removing the tariffs on Australian wine imports.
