Are you looking for big returns for your investment portfolio? If you are, then it could be worth checking out the ASX 200 shares in this article.
That's because analysts have named them as buys and tipped them to rise at least 25% over the next 12 months. Here's what they are recommending to clients:
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CSL Ltd (ASX: CSL)
The team at Morgans sees major upside potential for biotechnology giant CSL.
Its analysts think the market is materially undervaluing its shares at current levels, creating an incredible opportunity for Aussie investors.
Commenting on the ASX 200 share, the broker said:
We view CSL as materially undervalued, trading on an EV/EBIT of 18.2x, more than 25% below its 10-year average (24.7x). Based on a conservative SOTP valuation, we estimate fair value of A$196bn, implying c35% upside from current trading levels.
Notably, the market appears to be valuing CSL on less than a single division, with a c10% discount to the core Behring business alone, while effectively assessing zero or negative value to Seqirus and Vifor. We adjust our underlying earnings estimates lower by c4%, mainly on lower sales assumptions in Seqirus and Vifor, with our target price declining to A$303.70. Buy.
As mentioned above, the broker has a buy rating and $303.70 price target on CSL's shares. Based on its current share price, this implies potential upside of 25% for investors over the next 12 months.
Nextdc Ltd (ASX: NXT)
The team at Macquarie sees major upside potential for Nextdc shares.
This ASX 200 share is one of the region's largest data centre operators with a world class (and growing) portfolio.
Macquarie believes that NextDC is well-placed for growth over the long term thanks to the incredible demand for data centre capacity from the AI market. It said:
Strong Australian DC fundamentals. Australia has a strong strategic position in APAC, the fastest growing cloud region in the World. Govt openly supports digital infra. NSW expediting asset delivery with new authority. Recent VIC & NSW Premier visits at NXT assets. AU demand should grow >1.8GW in next 5 years. Driven by Stargate Global, Hyperscaler commitments and pent-up Enterprise demand.
Capital intensity is high, but is being deployed at an ROIC > WACC. Improving strategy to target AI contracts. Huge opportunity set, strong market position, need to execute. We have confidence in contract wins. Retain Outperform.
Macquarie has an outperform rating and $22.10 price target on the ASX 200 share. This suggests that upside of 62% is possible between now and this time next year.
