There are a lot of options for investors to choose from on the Australian share market.
So, let's take a look at three ASX shares from different sides of the market that analysts are tipping as buys. They are as follows:
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Polynovo Ltd (ASX: PNV)
In the healthcare sector, analysts at Morgan think that Polynovo is an ASX stock to buy now. The broker has an add rating and $2.85 price target on the medical device company's shares.
It likes the company's NovoSorb technology, which is used for treating burns. The broker said:
PNV's NovoSorb technology has gained rapid market traction, initially in burns and extending into trauma. Consensus has revenue growing by >20% p.a. for the next three years. Factors that will drive the revenue growth include: 1) expansion into new regions like Japan, China and Brazil; 2) a successful tender application in India; and 3) construction of its third manufacturing facility which is expected to support an additional A$500m in sales (5 times current production volumes).
Rio Tinto Ltd (ASX: RIO)
In the mining sector, the team at Goldman Sachs thinks that Rio Tinto would be a great option for investors. The broker has a buy rating and $136.60 price target on its shares.
Goldman likes Rio Tinto due to its positive production and free cash flow outlook. It explains:
RIO is a FCF and production growth story in our view, with forecast Cu Eq production growth of ~4-7% in 2025 & 2026 driven by the ramp-up of the Oyu Tolgoi UG copper mine & a recovery at Escondida and Bingham, higher Pilbara Fe shipments with the ramp-up of new mines, and a rebound in aluminium production + the acquisition of Matalco.
Xero Ltd (ASX: XRO)
Finally, in the tech sector, analysts at Goldman Sachs think that Xero is an ASX stock to buy now. Goldman has a conviction buy rating and $180.00 price target on its shares.
Its analysts highlight that Xero's total subscribers of 4.16 million is only scratching at the surface of its total addressable market (TAM). This gives it a long runway for growth. The broker said:
We see Xero as very well-placed to take advantage of the digitisation of SMBs globally, driven by compelling efficiency benefits and regulatory tailwinds, with >100mn SMBs worldwide representing a >NZ$100bn TAM. Given the company's pivot to profitable growth and corresponding faster earnings ramp, we see an attractive entry point into a global growth story with Xero our preferred large-cap technology name in ANZ.
