Do you have room in your investment portfolio for some new additions this month? If you do and you are looking for large cap ASX 200 shares to buy, then read on!
That's because the team at Ord Minnett has just picked out two large caps from very different sides of the market that it thinks could be worth considering right now.
Let's see what the broker is saying about these big-name ASX 200 shares this month:
Medibank Private Ltd (ASX: MPL)
The first ASX 200 share that could be a buy is private health insurance giant Medibank.
That's the view of Ord Minnett's analysts, which recently put an accumulate rating and $4.25 price target on its shares.
The broker was pleased with the company's performance in FY 2024, noting that its net profit after tax came in 3% ahead of consensus expectations at $308 million. This was up 13% year on year. And while policyholder growth was lower than expected, it notes that this was more than offset by its business mix and a higher gross margin.
So, with Medibank having defensive qualities and its shares trading with an undemanding valuation, Ord Minnett feels that now is the time to buy. The broker said:
With low growth expected and an undemanding P/E ratio, we view Medibank as a defensive stock that investors should own. We maintain our Accumulate recommendation, but lift price target to $4.25 from $4.15, reflecting higher earnings expectations.
Santos Ltd (ASX: STO)
Another ASX 200 share that the team at Ord Minnett thinks investors should be snapping up this month is Santos.
It currently has a buy rating and $8.50 price target on the energy giant's shares.
The broker likes the company due to its very positive free cash flow (FCF) outlook, which is being underpinned by its Pikka and Barossa LNG operations. It feels these operation will leave it well-placed to return funds to shareholders. The broker explains:
An estimated FCF yield of 20% once Pikka and Barossa LNG start producing, and rigorous control of how that extra cash is spent, implies to us that Santos will have plenty of room to return excess capital to shareholders either via an increased payout ratio or share buybacks. In our view, the medium-term prospects for Santos offer a compelling investment opportunity, leading us to raise our recommendation to Buy from Accumulate, while we maintain our target price of $8.50.
