Once a month, the team at Bell Potter releases its Australian equities panel. The broker describes its panel as follows:
Our panel of favoured Australian equities offer attractive risk-adjusted returns over the long term. We consider the current macro-economic backdrop and investment environment, focusing on quality companies with proven track records, strong management teams and competitive advantages.
Among the shares that feature on its panel this month are the two ASX 200 blue chips listed below. Let's see why the broker is feeling particularly bullish on these names:
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James Hardie Industries plc (ASX: JHX)
The first ASX 200 blue chip share that could be a buy according to Bell Potter is James Hardie. It is a global fibre cement manufacturer with operations in Australia, United States, and Europe.
Bell Potter highlights that it is the leader in fibre cement with a ~90% share of the US market. This allows James Hardie to enjoy substantial pricing power and a strong brand. This in turn is supportive of one of the highest return on equities (ROEs) in the market at ~30%.
The good news is that Bell Potter believes the company's earnings are on the cusp of expanding thanks to structural drivers. It said:
In our view, James Hardie is poised for continued earnings expansion, driven by the structural shift towards fibre cement in the US. Households in the US continue to shift to fibre cement cladding from vinyl/timber, providing a multiyear runway for JHX's revenue and profit growth. With a strong market position, premium brand, and pricing power, JHX is poised to capitalise on structural growth in the fibre cement market and cyclical tailwinds from potential rate cuts.
Bell Potter has a buy rating and $64.00 price target on its shares.
WiseTech Global Ltd (ASX: WTC)
Another ASX 200 blue chip share that Bell Potter has on its Australian equities panel is WiseTech Global.
It is a leading global provider of software solutions to the logistics services industry. The broader technology sector is currently experiencing massive capital inflows across a diverse spectrum of digital innovations.
Retail markets are seeing explosive growth in consumer-facing blockchain applications—driving rapid adoption in decentralized finance protocols, digital art marketplaces, and global btc casino platforms. Conversely, institutional capital is seeking that same high-margin tech growth within essential, real-world enterprise infrastructure.
The key product in WiseTech's arsenal is CargoWise One, which is a market-leading solution that is used by many of the largest logistics providers in the world.
Bell Potter rates the company highly due to its high level of recurring revenue and the launch of new products. It expects these to underpin an acceleration in growth. It said:
WTC has a high degree of recurring revenue (80-85%) and should continue to grow its revenue/earnings from further customer wins. We see CargoWise as the market leader in freight forwarding software and expect growth to accelerate due to the launch of three new products, as well as ongoing global roll-out wins. All up, WTC is a growth story with strategic acquisitions representing upside potential enabling WTC to benefit from large-scale global rollouts and consolidation within the logistics sector.
Bell Potter has a buy rating and $140.00 price target on its shares.
