Reporting season gives analysts an up-to-date view on businesses when they deliver their result. I think this is a great time to look at compelling ASX shares that could be strong picks. There are certain businesses that numerous experts think are buys.
When one analyst thinks a business is a buy, that's interesting. When there are numerous experts rating an ASX share as a buy, that could signal there's a clear, compelling opportunity. Time will tell if they're right.
Let's look at two, non-tech companies.
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Amcor (ASX: AMC)
According to the Commsec's collation of analyst views on the flexible and rigid packaging ASX share, there are currently 18 buy ratings.
UBS is one of the brokers that rate the business as a buy, with a price target of $91.25, suggesting a pleasing double-digit rise over the next year from where it is today.
The broker said that the earnings per share (EPS) generated in its FY26 second quarter was "reasonable" and at the midpoint of its guidance, while being 3% ahead of market expectations.
UBS noted that company is still expecting FY26 EPS to growth of between 12% to 17%, with the market assuming the company will hit the low end of this guidance.
The broker also highlighted that the business provided third-quarter EPS guidance of between 90 cents to $1, with confidence of delivering synergies of at least $260 million in FY26 and $650 million over three years. Growth synergies also appear to be "gaining momentum" as well, with a run-rate $100 million of annualised sales secured so far.
UBS then explained why it rates the business as an appealing buy:
We maintain our Buy rating, with Amcor offering a 12% 3yr EPS CAGR, underpinned by the potential delivery of $650mn in synergies and accretion on the all-stock merger with Berry.
We think potential EPS upgrade momentum could be supported by accelerated synergy realisation over the next 24 months. We believe Amcor's revised capital allocation framework also positions the company to allocate increased FCF [free cash flow] to support deleveraging, investment in higher growth categories and potential capital returns (ie, share buy backs).
Delivery on these should support a P/E re-rate from 11x to 15x, which is where the stock has typically traded when offering double-digit EPS growth.
AGL Energy Ltd (ASX: AGL)
According to the Commsec collation of analyst views on the ASX share, there are currently nine buy ratings on the ASX share.
UBS is one of those brokers that rates this energy retailer and generator as a buy, with a price target of $11.00.
The broker noted that AGL's underlying operating profit (EBITDA) and net profit were 7% and 21% ahead of market expectations, respectively, supported by strong realised gas retail pricing and generation available.
UBS noted that AGL expects volatility to prevail in the long-term and owning low-cost capacity assets with some operating flexibility to capture a greater share of higher price periods (such as AGL's Loy Yang A and Bayswater power stations) place AGL "in a strong position to grow underlying EBITDA" year-over-year to 2030, as long as generation availability is maintained.
The broker forecasts UBS will grow EBITDA at a CAGR of 10% and net profit at a CAGR of 15% between FY26 to FY30, which is more than other market analysts are suggesting.
UBS also said that the recent result confirmed that AGL's battery portfolio is "performing well ahead of its own expectations & reiterated that batteries can sustain post tax unlevered asset returns at the upper end of its 7-11% target range—despite accelerating growth in both utility scale & residential battery installs."
Then UBS added to its explanation why it thinks the ASX share is attractive:
Over time as the market builds confidence that low cost capacity assets will become increasingly valuable, we believe market estimates should reflect multi-yr EPS upgrades supporting a growing div profile with upside pending the Board's willingness to reward shareholders with stronger payouts.
