If you are fortunate enough to have $10,000 to invest into the share market when it reopens next week, the ASX 200 stocks listed below could be worth considering.
That's because analysts have just put buy ratings on them and are tipping outsized returns. Here's what they are recommending to clients:
Aristocrat Leisure Ltd (ASX: ALL)
The team at Macquarie Group Ltd (ASX: MQG) thinks that this gaming technology company's shares are undervalued after pulling back last week.
It notes that its shares are trading at a modest 21x forward earnings, which is a deep discount to historical levels. And this is despite the broker forecasting double digit earnings growth through to at least FY 2028.
Commenting on Aristocrat, the broker said:
Aristocrat has de-rated, trading on 21x 12mth fwd P/E; consistent with the ASX300 industrials, and which has only happened 6 times since 2010. We think there has been an overreaction to the FY25 result; growth is intact (+12% EPSA CAGR, FY25-28) and the balance sheet supports capital management/M&A.
Macquarie has an outperform rating and $75.00 price target on the ASX 200 stock. Based on its current share price of $57.40, this implies potential upside of 30% for investors over the next 12 months.
Life360 Inc (ASX: 360)
Another ASX 200 stock that was sold off last week and could be a top pick for a $10,000 investment is location technology company Life360.
Bell Potter thinks this has created a compelling buying opportunity for investors. Especially given its belief that the reason for the selloff, softer monthly active user (MAU) growth, was a deliberate choice by management.
Commenting on the growing company, the broker said:
The combination of the forecast changes and time creep has driven an 11% increase in our PT to A$52.50 which is a 15% premium to the share price so we retain our BUY recommendation. In short, we are not perturbed by the slower-than-expected MAU growth in Q3 when it was an intentional shift in marketing spend and also when there was a corresponding increase in the conversion rate. As CEO Lauren Antonoff said, "the strategy is working".
In response to its results, Bell Potter has retained its buy rating with an improved price target of $52.50. Based on its current share price of $37.12, this suggests that upside of 41% is possible between now and this time next year.
