Owning a few blue chip ASX 200 shares can be a good way of ensuring you have a rock-solid investment portfolio.
But deciding which blue chips to buy over others is not easy. But don't worry, because analysts at Goldman Sachs have done the hard work for you.
Listed below are three blue chips that the broker rates very highly right now. Here's what you need to know about them:
Endeavour Group Ltd (ASX: EDV)
The first blue chip ASX 200 share that Goldman Sachs has named as a buy is Endeavour.
It is the drinks giant behind the BWS and Dan Murphy's brands, as well as a large network of hotels.
Goldman believes Endeavour's shares are good value based on its leadership position and positive outlook. It explains:
Most attractive valuation amongst Staples peers: We continue to see defensiveness in the company's Retail business with relative market share of ~35% vs COL liquor of ~13%, 5.2mn active My Dan's members. EDV is currently trading at FY24e P/E of 18.4x with FY23-25e EPS CAGR of ~5%, which is the cheapest vs WOW, COL, WES.
Goldman has a conviction buy rating and $6.40 price target on the company's shares.
ResMed Inc. (ASX: RMD)
Another blue chip ASX 200 share that Goldman Sachs rates as a buy is ResMed.
It is a sleep treatment company with a portfolio of leading hardware and digital solutions for disorders such as sleep apnoea.
Goldman Sachs believes the risk/reward is very attractive for investors at current prices. It said:
We view the risk/reward to be favorable and are Buy-rated. We view valuation as attractive and see a favourable risk-reward skew post the recent de-rate, noting the shares are trading meaningfully below historical averages on both a P/E and EV/EBITDA basis.
The broker has a buy rating and $32.00 price target on the company's shares.
Woolworths Limited (ASX: WOW)
Finally, Australia's largest supermarket operator could a blue chip ASX 200 share to buy according to Goldman.
Its analysts like Woolworths due to potential market share gains thanks to the strength of its loyalty program and its omni-channel advantage. The broker said:
We are Buy rated (on Conviction List) on the stock as we believe the business has among the highest consumer stickiness and loyalty among peers, and hence has strong ability to drive market share gains via its omni-channel advantage, as well as pass through any cost inflation to protect its margins, beyond market expectations.
Goldman has a buy rating and $42.40 price target on its shares.
