Insights

2 ASX shares that multiple brokers really like

These 2 ASX shares have been rated as buys by many brokers.
The post 2 ASX shares that multiple brokers really like appeared first on The Motley Fool Australia. –

There are some ASX shares that plenty of brokers like at the moment.

Everyone has a different opinion about each business. But if multiple analysts like the same company then it could be an opportunity:

Steadfast Group Ltd (ASX: SDF)

Steadfast Group says it’s the largest general insurance broker network and the largest group of insurance underwriting agencies in Australasia, with growing operations in Asia and Europe.

It has a broker network that get better market access, exclusive products and services through the Steadfast Group. Steadfast has underwriting agencies that designs, develops and provides specialised insurance products and services to brokers inside and outside of Steadfast. Steadfast also has a number of complementary and supporting businesses for insurance like technology, risk, life insurance, reinsurance and lawyers.

Steadfast is currently rated as a buy by at least four brokers, including Credit Suisse which has a price target on Steadfast of $4.60. It noted the recent profit upgrade.

In that upgrade, the ASX share increased its earnings expectations after a “strong” first nine months of FY21 with revenue growth of 7.2% and underlying earnings before interest, tax, depreciation and amortisation (EBITDA) growth of 20.5%.

After good organic growth and accretive acquisitions, Steadfast said that it’s expecting underlying net profit after tax (NPAT) to come in a range of $127 million to $132 million – that guidance was increased from a range of $120 million to $127 million. Underlying earnings per share (EPS) is expected to grow by 15% to 20%.   

Steadfast said that strategic partners continue to implement moderate premium price increases.

FINEOS Corporation Holdings PLC (ASX: FCL)

FINEOS is an ASX software share that provides software to the employee benefits and life, accident and health industry. It says that it helps customers upgrade from outdated legacy administration systems to a modern purpose-built, customer-centric product-suite. It enables improved operational efficiency, increased effectiveness and excellent customer care.

It’s currently rated as a buy by at least three brokers, including the ones at Macquarie Group Ltd (ASX: MQG) that have a price target of $4.63 on FINEOS. That suggests a possible upside of over 20% over the next 12 months. Macquarie thinks that FINEOS can claim more wins which could help.

In the quarter ending 31 March 2021, it revealed that FY21 total revenue is on track to hit the upper end of its guidance range of $102 million to $105 million and achieve the targeted 30% growth in subscription revenue (before the contribution from the Limelight acquisition).

Since that quarterly update, the ASX share announced the acquisition of Spraoi for an upfront US$4 million and an earnout of up to US$6.6 million. Spraoi is a leading provider of machine learning capabilities for the employee benefits and life industry. It currently has eight clients and achieved US$6 million of revenue in the year to 31 December 2020 and is expected to be earnings accretive to FINEOS, excluding transaction costs, after its first full year.

FINEOS is excited by this acquisition because it gives it immediate opportunities to leverage from its existing client base and product capabilities.

The post 2 ASX shares that multiple brokers really like appeared first on The Motley Fool Australia.

Wondering where you should invest $1,000 right now?

When investing expert Scott Phillips has a stock tip, it can pay to listen. After all, the flagship Motley Fool Share Advisor newsletter he has run for more than eight years has provided thousands of paying members with stock picks that have doubled, tripled or even more.*

Scott just revealed what he believes could be the five best ASX stocks for investors to buy right now. These stocks are trading at near dirt-cheap prices and Scott thinks they could be great buys right now.

*Returns as of May 24th 2021

More reading

5 ASX shares tipped to pay higher dividends: fund manager

More of this leading broker’s best ASX share ideas for June

Here’s how the ANZ (ASX:ANZ) share price performed over May
2 excellent ASX 200 blue chip shares to consider

ASX 200 Weekly Wrap: ASX record highs tumble like… Costa shares

Motley Fool contributor Tristan Harrison has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has recommended FINEOS Corporation Holdings plc. The Motley Fool Australia owns shares of and has recommended Macquarie Group Limited. The Motley Fool Australia has recommended FINEOS Corporation Holdings plc and Steadfast Group Ltd. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

Important Notice
Trade The US Market With ZERO Brokerage* + FREE Access To Trading Ideas & Value Analysis Tools. Click Here!