Looking for big returns? If you are, then it could be worth checking out the two ASX shares in this article.
That's because analysts have just put buy ratings on them and are expecting upside of at least 20% from current levels.
Here's what they are recommending:
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Netwealth Group Ltd (ASX: NWL)
Bell Potter thinks this ASX share could be being undervalued by the market, especially after a strong quarterly update this week.
In response to its update, the broker has retained its buy rating and $30.00 price target on Netwealth's shares. Based on its current share price of $24.43, this implies potential upside of over 20% for investors over the next 12 months.
Commenting on its recommendation, Bell Potter said:
NWL has provided an update across multiple fronts, highlights being the first material endorsement of its new private wealth and stockbroking solution, as well as long-term ambitions for the group. This includes more advanced net flow guardrails. We expect the conversation to move towards growth (and away from dissecting margins). The update sees net flows revised up, after delivering periods of $15B. We expect this will release doubts around governance, market volatility and proposed tax changes.
Our Buy rating is unchanged, and we upgrade our net flow estimates +8% FY27-29. Building in margin guidance prompts us to downgrade EPS -7%/-4% and we leave headroom on the FUA target. NWL is looking to replicate EPS growth. The mandate win is the first example of a catalyst, independent of any potential vendor attrition.
ResMed Inc. (ASX: RMD)
Morgans highlights that this sleep disorder treatment company's shares have de-rated to their lowest PE ratio since the GFC.
As a result, the broker believes a buying opportunity has opened up and has put a buy rating and $41.72 price target on its shares. Based on its current share price of $31.44, this implies potential upside of approximately 33%.
Commenting on ResMed shares and its buy thesis, Morgans said:
RMD has de-rated to ~16x forward earnings, its lowest valuation since the post-GFC period, despite consensus continuing to forecast double-digit EPS growth. GLP-1 therapies, positive Phase III data from Apnimed's oral OSA therapy, the prospect of Philips re-entering the US PAP market from 2027 and broader healthcare sector de-rating, have driven recent share price weakness.
While these risks are real, current industry data and RMD's operating performance provide limited evidence of a material deterioration in underlying demand. We make no changes to FY26-28 forecasts or our A$41.72 target price. BUY.
