A new month in on the horizon, so what better time to start planning some new investments.
But which ASX 200 shares could be top picks for investors in June? Let's look at two that analysts at Goldman Sachs are tipping as buys:
Wesfarmers Ltd (ASX: WES)
Goldman Sachs thinks that Wesfarmers could be an ASX 200 share to buy.
Wesfarmers is the conglomerate behind Bunnings, Kmart, Officeworks, Silk Laser, and countless other businesses.
It likes the company due to the strength of its Bunnings business, its potential to increase sales productivity, and growth in lithium and health. It explains:
Wesfarmers is a conglomerate that operates across a range of industries with ~65% of EBIT coming from Bunnings, a household hardware chain. We have a Buy recommendation for WES based on 1) Bunnings' market share gain against soft operating backdrop 2) Bunnings' long term growth options in sales/sqm and Retail Media. 3) Portfolio management sees Lithium/Health scaling to deliver double digit EBIT growth in FY26. WES in our view is undervalued relative to these growth prospects.
Goldman Sachs currently has a buy rating and $87.30 price target on its shares.
Xero Ltd (ASX: XRO)
Another ASX 200 share that could be a buy for Aussie investors in June is Xero.
It classes itself as a small business platform that helps customers supercharge their business by bringing together the most important small business tools, including accounting, payroll and payments — on one platform.
At the last count, the company had approximately 4.4 million subscribers on its platform. While this is a large number, it is only a fraction of its estimated global total addressable market of 100 million.
Goldman Sachs believes it is well-placed to grow in this market thanks to the digitisation of small businesses, which is being driven by efficiency benefits and regulatory tailwinds. Commenting on its buy recommendation, 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 – the stock is Buy rated.
The broker currently has a buy rating and $205.00 price target on this ASX shares.
