The ASX 50 index is home to the 50 largest companies on the Australian share market.
This means it is filled to the brim with many of the highest quality companies that investors can buy.
But which of these ASX 50 stocks could be in the buy zone and offer big returns for investors? Let's take a look at one that analysts at Goldman Sachs are feeling very bullish on right now.
Buy this ASX 50 stock for big returns
According to a note out of the investment bank from this morning, its analysts think investors should be snapping up QBE Insurance Group Ltd (ASX: QBE) shares while they are still cheap.
The broker has been busy looking at QBE's North American business following the release of industry data and was pleased with what it saw. It notes that "QBE's NA business mix is improving" and that its "net reserves ex Crop do not appear deficient."
In light of this, Goldman Sachs has retained its buy rating and $21.00 price target on the insurance giant's shares. Based on its current share price of $16.94, this implies potential upside of 24% for this ASX 50 stock over the next 12 months.
To put that into context, a $10,000 investment would turn into $12,400 in a year if Goldman Sachs is on the money with its recommendation.
But the returns won't stop there. QBE is a big dividend payer and Goldman is forecasting dividend yields of 5.3% in FY 2024, 5.5% in FY 2025, and then 5.7% in FY 2026. This boosts the total potential 12-month return over 29% for investors.
Goldman likes QBE due to its exposure to commercial rates, its positive insurance premium outlook, and the improving North American business. It also feels that its valuation is undemanding at current levels.
Commenting on its bullish view, the broker said:
QBE is a global commercial insurer with three main geographical operations across Australia Pacific, International (encompassing Europe) and North America. We are Buy-rated on QBE because 1) QBE has the strongest exposure to the commercial rate cycle. 2) QBE's achieved rate increases continue to be strong & ahead of loss cost inflation. 3) North America on a pathway to improved profitability. 4) Valuation not demanding. 5) Strong ROE.
Overall, this could make this ASX 50 stock worth considering if you're looking for a combination of big upside potential and a generous dividend yield.
