Brokers rate these 2 top ASX shares as buys in January

Here's why these unknown names could be good buys this month.

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Key points

  • Two under-the-radar ASX shares deserve more investor attention: Redox (ASX: RDX), a leading chemical and raw materials supplier, and Hansen Technologies (ASX: HSN), a global software provider for energy and telecom industries, are both rated as buys by broker UBS.
  • Redox is poised for recovery after a challenging FY25: Despite headwinds from price deflation and subdued demand, the company reported 13% top-line growth in July and is projected to grow earnings by 55% between FY26 and FY30, with UBS setting a $3.40 price target.
  • Hansen's recent Digitalk acquisition positions it in a growing market: The $66 million purchase gives Hansen exposure to the fast-growing mobile virtual network operator (MVNO) segment, and UBS expects solid revenue growth alongside continued operating leverage, with a price target of $7.50.

There are a wide range of ASX shares available for Aussies to buy, but not all of them get the attention they deserve.

A little-known business is just as capable of producing good returns as a high-profile name. In-fact, companies flying under the radar may be trading on a more appealing valuation because of the little amount of investor attention they receive.

We're going to take a look at two names that a lot more Australians should to know about.

Redox Pty Ltd (ASX: RDX)

Broker UBS describes Redox as a leading supplier of chemicals, ingredients and raw materials in ANZ, as well as operations in Malaysia and a growing presence in the US.

UBS was impressed by the company's FY25 result, which showed a resilient gross profit margin and lower costs through a period of moderating like for like (LFL) volume growth.

At the time of that result, management reiterated it expects to deliver long-term growth of around 10% per year, with some years leaner than that and others stronger. FY25 was a year of headwinds including price deflation, margin normalisation and more subdued demand.

UBS noted the ASX share reported a solid start to FY26, with July top-line growth of 13% year-over-year.

While there is uncertainty in FY26, the broker suggests conditions will improve towards longer-term trends in FY26 with price deflation in the rear-view mirror.

UBS also notes that acquisitions remain "on the agenda" and the broke has seen a shift in tone towards the US as a focus after completing three bolt-on acquisitions in Australia. The broker suggested that the balance sheet is well-funded for more deals and the long-term story remains "positive".

The broker forecasts that the business could generate $82 million of net profit in FY26, putting the ASX share at 19x FY26's estimated earnings. It's projected to grow its earnings by 55% between FY26 and FY30.

UBS has a buy rating on Redox, with a price target of $3.40.

Hansen Technologies Ltd (ASX: HSN)

Another ASX share that UBS rates as a buy is Hansen Technologies. The broker describes the business as a global software provider mainly to the energy, telecommunications, pay-TV and water verticals.

UBS said that the company's billing and customer care software allows clients to "efficiently manage and automate key business functions, such as customer billing, processing, collections, general revenue management, customer acquisition, and customer service."

It has hundreds of customers globally, with dozens of offices across the continents.

The most recent note from UBS discussed the company's acquisition called Digitalk, giving new exposure to the growing mobile virtual network operator (MVNO) segment of the telecommunications market.

This acquisition came with an enterprise value price tag of $66 million. It's a billing, cloud-based software provider to the MVNO segment of the telco market.

UBS noted that MVNOs have been taking market share globally thanks to lower price points and more convenient type plan offerings, so this sector "should be viewed as a growth market". Digitalk has delivered revenue growth of at least 10% per year consistently over the last three years, driven by a range of telco wins supporting increased MNVO market share gains in the UK and Europe.

The broker then said about the ASX share:

Given its cloud/SaaS based nature, the revenue growth has come alongside consistent margin expansion to current FY25 levels of 31.4%. Quite simply we believe this is a small albeit very impressive founder led business that Hansen has acquired.

…For core Hansen, we remain constructive on its ability to deliver top line and earnings growth in FY26, acknowledging this remains an area of market debate. We forecast FY26 revenue growth of 5% to A$408mn. Within this, we expect (1) 12% growth in recurring Saas / Support & Maintenance revenue as recently won / renewed Licence revenues go live, (2) +8% growth in predictable Application or Services revenue, offset by (3) an expected 35% decline in up-front Licence sales to A$32mn after a very strong FY25 (A$50mn).

The solid top-line growth will, in our view, more importantly be also met with another year of operating leverage as the company continues to realise recent efficiency benefits and Powercloud cost outs.

UBS has a buy rating on Hansen shares, with a price target of $7.50 on the ASX share.

Motley Fool contributor Tristan Harrison has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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