If you are on the hunt for some cheap ASX 200 shares to add to your portfolio, then read on!
That's because listed below are two that Morgans has named as buys this week and is tipping to rise strongly from current levels. Here's what the broker is saying about them:
James Hardie Industries plc (ASX: JHX)
The first ASX 200 share that could be cheap is building materials company James Hardie.
Morgans remains positive on the company despite the release of softer than expected FY 2026 guidance this week. This is due to its positive long term outlook, which is being driven by structural changes in home construction and a potential renovation boom. It said:
JHX's FY25 result was largely in line with guidance, whilst the outlook for low single-digit (LSD) EBITDA growth in FY26 fell short of consensus expectations (consensus were more mid to high single digit). Management confirmed that conditions remain challenging as R&R activity levels continue to decline and single-family home builders report soft conditions.
Despite any potential recovery being pushed out, JHX expects to see EBITDA growth through FY26, albeit at a more modest pace. Longer term, JHX remains well placed to drive further material conversion (against vinyl) as the c.35m homes of prime renovation aged are progressively re-sided. On this basis, we retain our Add rating with a $50/sh price target.
Morgans has an add rating and $50.00 price target. Based on its current share price of $36.56, this implies potential upside of 37% for investors over the next 12 months.
Light & Wonder Inc. (ASX: LNW)
Another cheap ASX 200 share to buy could be gaming technology company Light & Wonder.
Morgans was pleased with the company's growth plans, which sees it targeting US$2 billion in EBITDA by 2028. It said:
Light & Wonder's long-anticipated Investor Day in New York set out the next stage of its growth story. Since the last US event in 2022, the group has generated a 13% revenue CAGR and a 17% Adj-EBITDA CAGR, while cutting leverage from 10.5x to 3.0x, without raising additional capital. Management now targets Adj-EBITDA of US$2bn and EPSA of US$10.55 by 2028 – both more than 10% above our previous forecasts – together with the divisional objectives detailed below. LNW is the only company in its peer group to provide long-term guidance and remains our preferred exposure to the sector.
We anticipate incremental consensus upgrades as milestones are met and note that the shares trade on roughly 13x FY26F PER, a discount that reflects ongoing litigation, listing and tariff uncertainty. We maintain an Add rating and lift our target price to A$200, underpinned by MorgansF expected 18% four-year EPSA CAGR.
Morgans has an add rating and $200.00 price target on its shares. This suggests that upside of 55% is possible from current levels.
