Some ASX shares may be significantly undervalued according to expert analysts, with the potential to outperform the market.
Over the ultra-long term, the S&P/ASX 200 Index (ASX: XJO) has returned an average of around 9% to 10% per year. Based on the price targets, experts are suggesting some stocks could deliver returns of around 50% or even more.
Let's look at two of the most compelling ideas right now.
Image source: Getty Images
Judo Capital Holdings Ltd (ASX: JDO)
Judo is an ASX bank share that lends to small and medium enterprises (SMEs). A significant source of funding comes from the savings accounts and term deposits for individuals, businesses, and self-managed superannuation funds (SMSFs).
According to CMC Invest, there have been seven analyst ratings on the business within the last three months. Five of those ratings were buys, one was a hold, and one was a sell. The average price target of the seven ratings was $1.41, suggesting a possible rise of 54% over the next year.
In the recent company update, Judo reported that lending activity was solid during the quarter, with gross loans and advances (GLA) reaching almost $15.1 billion at 30 September 2026, with "robust originations and improving attrition". GLA was $14.7 billion at the end of FY26, so it rose by around 2.7% quarter over quarter.
The company said that it's still on track to achieve its FY27 guidance of profit before tax of between $210 million to $220 million, representing a year-over-year increase of between 25% to 31%.
Judo is seeing a bit of caution from SMEs due to the various economic factors, as well as an increase of the arrears, which would explain why the Judo share price is now so much cheaper – it's down 48%. Experts suggest the market is now undervaluing the company's potential.
Mineral Resources Ltd (ASX: MIN)
Another ASX share that's highly rated is Mineral Resources, which is a mining services business and a miner of iron ore and lithium in Australia.
According to CMC Invest, there have been nine ratings on the business in the last three months. Six of those analyst ratings were buys, two were holds, and one was a sell. Of those nine ratings, the average price target was $62.28, implying a possible rise of 47% over the next year.
The company recently announced its FY27 first-quarter update, which included positives for its key divisions.
It reported record mining services production volume of 103mt, up quarter over quarter.
In the iron ore division, quarterly attributable shipments came to 7.9mt. Onslow production (100% basis) increased 21% year over year and the Pilbara hub production grew 31% year over year.
In the lithium division, total quarterly attributable spodumene (lithium) production across its three projects (Wodgina, Mt Marion, and Bald Hill) was 166kt, up 17% quarter over quarter.
The company is doing the right things to improve its underlying performance and delivering solid production.
