Stock Tips: An iron giant and a biotech behemoth make their presence felt
Andrew Eddy – Morgans Financial
BUY
Minerals 260 (MI6)
Offers significant gold resource growth potential, clear M&A appeal and a path to production. Not without risk but see significant upside potential.
Motorcycle Holdings (MTO)
Has acquired profitable dealerships, expanded into new markets and strengthened its e-commerce capabilities, positioning itself for significant growth.
HOLD
Transurban Group (TCL)
Offers stable returns with high-quality toll road assets, driven by population growth, economic development and strong pricing power through toll escalations
James Hardie (JHX)
The highest quality building products business on the ASX, with strong returns on capital and a dominant market position – just need to see an improving housing outlook in the US to become more bullish.
SELL
Santos (STO)
Investors might consider taking some money off the table with Santos with limited upside to bid price but there are significant risks and hurdles for a deal to be completed.
Cochlear (COH)
Company recently downgraded guidance on slower growth in services and Cochlear Implant uptake, still a quality stock but further downside earnings risks remain.
Dylan Evans – Catapult Wealth
BUY
CSL Ltd (CSL)
The uncertain trade and tariff environment provides an opportunity to purchase a business reporting double digit earnings growth at a compelling price.
RIO Tinto (RIO)
RIO has exposure to iron ore, aluminium, copper and lithium. Iron ore is unlikely to offer growth moving forward, but the remaining areas of the business play into attractive themes, particularly the growing demand for electricity, batteries, and other technologies.
HOLD
Technology One (TNE)
Australia's leading enterprise software company has been delivering fantastic results with consistent momentum. TNE hit its $500m annual recurring revenue target in May, 18 months ahead of schedule, and the company is now targeting $1bn by 2030.
Virgin Australia (VGN)
Virgin's return to the ASX is well timed, against a favourable backdrop of lower fuel prices and falling rates. With that said we are cautious of owning airlines for any long period, being a cyclical industry with a history of insolvencies and administrations.
SELL
BlueScope Steel (BSL)
While BlueScope's move into downstream construction markets is positive, the underlying business operates in a low margin industry heavily reliant on volatile energy costs and steel prices.
Washington H Soul Pattinson (SOL)
Washington Soul Pattinson recently announced a merger with Brickworks (BKW), two companies with a long history of cross-ownership. The merger makes sense, but the share price has rallied considerably.
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