If you are in the market for some new additions to your ASX share portfolio, then read on!
That's because the team at Morgans has put buy ratings on three shares this week. Here's what it is recommending:
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Cogstate Ltd (ASX: CGS)
This healthcare technology company has been given a buy rating and $4.07 price target this week by Morgans. Based on its current share price of $3.37, this implies potential upside of approximately 20%.
Commenting on its recommendation, Morgans said:
CGS is a high-quality, science-led provider of digital cognitive assessment and endpoint data quality services to the clinical trials industry. Following a record FY26, CGS enters FY27 with record contracted future revenue of US$118.5m (+32% pcp), a diversifying pipeline, and a two-year technology program designed to expand margins as volumes grow without a corresponding increase in headcount. It is debt-free with US$34.7m in cash, generates high incremental margins on a largely fixed cost base, and returns capital through dividends while retaining capacity to reinvest.
The share price has re-rated strongly as the market has recognised the improving quality and predictability of earnings. The key question is whether CGS can sustain continued contract growth while converting scale into improved margins, an outcome we see as achievable. We initiate coverage with a BUY rating and A$4.07 target price.
Nufarm Ltd (ASX: NUF)
Another ASX share that has been given the thumbs up from Morgans is agricultural chemicals company Nufarm.
The broker has put a buy rating and $4.24 price target on its shares. This suggests that upside of around 40% is possible from current levels.
Morgans believes that Nufarm shares are materially undervalued compared to peers. It explains:
If it wasn't for two unplanned manufacturing disruptions, in our view, NUF would have beaten consensus expectations given Seed Technologies earnings have once again been upgraded due to higher Omega-3 prices. Importantly, NUF is still guiding towards strong earnings growth in FY26 and is on track to materially deleverage, with further improvement targeted in FY27. Given NUF's operating and financial leverage and high tax rate in FY26, a minor EBITDA revision results in a large downgrade to EPS.
With further operational improvements targeted, another A$50m cost out program and more Omega-3 oil to sell at high prices, we have left our FY27/28 EBITDA forecasts unchanged, while EPS in these years increases given lower D&A post plant closures. While a revision before an Investor Day next week is unfortunate, the turnaround plans at NUF remain on track and the stock is materially undervalued compared to peers. We reiterate our BUY rating with a new price target of A$4.24.
Ramelius Resources Ltd (ASX: RMS)
Finally, this gold miner has been given a buy rating and $5.02 price target from Morgans this week.
Based on its current share price of $3.87, this implies potential upside of approximately 30% over the next 12 months.
Morgans was pleased with its four-year growth outlook, highlighting that it is on a pathway to becoming a 600,000 ounces per annum producer by FY 2030. It said:
RMS has released its FY27 guidance and four-year outlook, outlining a clear pathway to ~600kozpa by FY30, driven by the expansion of the Mt Magnet processing hub and a growing contribution from higher-grade underground ore sources. The outlook reinforces our view that RMS is developing one of the highest quality growth profiles in the Australian gold sector.
FY27 guidance of 205-225koz at an AISC of A$2,150-2,350/oz was broadly in line with expectations, while the medium-term outlook delivered meaningful production upgrades from FY29 onward as higher-grade material from Dalgaranga, Cue and Galaxy displaced lower-grade feed in the mine plan. We maintain our BUY rating and raise our price target to A$5.02ps.
