If you are hunting outsized returns, then it could be worth checking out the ASX 200 shares in this article.
That's because last week analysts put buy ratings on them with price targets offering major upside potential. Here's what they are recommending:
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Megaport Ltd (ASX: MP1)
The team at Morgans has responded positively to news that Megaport's Latitude business has won a series of large contracts.
The broker has retained its buy rating on the ASX 200 share with an improved price target of $15.50. Based on its current share price, this implies potential upside of almost 20% for investors over the next 12 months.
Commenting on its buy recommendation, Morgans said:
MP1 has announced a series of large contract wins which are financially and strategically significant. MP1 will use its globally unique communications platform to connect servers and GPU clusters in numerous DCs across the US. DC power constraints are a growing issue and MP1 was uniquely able to stitch together multiple sites to provide consolidated inference solutions. We update our forecasts to reflect recent contract wins, lifting our TP to $15.50 per share. We retain a BUY recommendation.
Temple & Webster Group Ltd (ASX: TPW)
Over at Bell Potter, its analysts remain positive on this online furniture retailer.
Last week, the broker retained its buy rating on Temple & Webster's shares with a reduced price target of $7.00. Based on its current share price, this implies potential upside of almost 40% for investors between now and this time next year.
Bell Potter highlights that its shares are back down to levels not seen since 2022. However, this time around its valuation is significantly more attractive. As a result, it thinks it could be a good long-term pick for patient investors. It said:
With the continuous decline in the share price, we have seen the name back at the levels of the last profit optimisation cycle in CY22 however trading at a more attractive EV/Sales multiple (0.8x in May-26 vs 1.4x in Aug-22, on BPe).
While our estimates continue to factor in some downside risk to current company expectations/consensus, we see long term valuation support in a high-quality e-commerce retailer with range, pricing/scale advantages, AI/data capability backed by a strong balance sheet (~$160m cash, BPe) to take up inorganic growth opportunities. Other catalysts remain as potential for removal from the S&P/ASX 200 Index at the Jun rebalance and the leadership transition in Jul.
