Using the Trending Stocks tool for the Australian market, we have shortlisted two ASX-listed companies: Brambles Limited (AU:BXB) and Allkem Limited (AU:AKE). Analysts have assigned a Moderate Buy rating to Brambles and a Strong Buy rating to Allkem Limited.
The Trending Stocks tool consists of stocks that have garnered attention from analysts in recent times. This tool is accessible across seven different markets and can assist investors seeking geographic diversification in their investments.
Now, let’s delve into some of the details.
Brambles Limited
Brambles is a global logistics company with the largest collection of reusable pallets, crates, and containers. Brambles holds a leading position in promoting efficient and environmentally friendly supply chains.
The company’s stock has grown by over 25% in the last six months, including a surge after the release of its results for the first half of fiscal year 2023.
Recently, the company reported that its nine-month sales for FY 2023 grew by 9% to $4.48 billion. Brambles also stated that there was an improvement in pallet availability during its third fiscal quarter, ending a prolonged period of limited supply. This allowed the company to resume its new business opportunities in the U.S. and Europe. This led to the company revising its yearly revenue and profit outlook upward, driven by increased prices and efficient supply management.
Following this announcement, over the past month, analysts have been actively engaged with the stock, reaffirming their Buy ratings. 19 days ago, analyst Paul Butler from Credit Suisse reiterated his Buy rating on the stock with the highest price target of AU$16.4. This implies an upside of 16.23% on the share price.
What is the Target Price for Brambles’ Stock?
According to TipRanks’ consensus forecast, BXB stock has a Moderate Buy rating, based on seven Buy, three Hold, and one Sell recommendations.
At an average target price of AU$15.01, analysts suggest a growth of 6.37% on the current price.
Allkem Limited
Allkem is a chemical manufacturing company that specializes in producing a range of lithium chemicals. With the increasing demand for lithium, the company is strategically positioned to cater to the thriving electric vehicle (EV) markets.
Recently, the company’s shares soared after it was reported that Rio Tinto Ltd. (AU:RIO) is considering Allkem as a potential acquisition target. YTD, Allkem stock has been trading up by 16.2%.
Allkem’s earnings report for the first half of the fiscal year 2023 indicates a remarkable increase in revenue, with a surge of 209% to $558 million. The earnings also soared by over 300%, reaching $402 million. The outstanding figures were primarily attributed to the record-breaking production levels achieved by its Olaroz Lithium Facility, located in Argentina.
Recently, Canaccord Genuity’s analyst Reg Spencer reiterated his Buy rating on the stock with a prediction of more than 50% upside in the share price. According to Spencer, the price of lithium is expected to reach $50,000 per metric ton in 2023, up from $43,236 per tonne in 2022. He also added that it implies a remarkably high level in comparison to past trends, which is likely to result in significant earnings and cash flow for the lithium producers currently in operation.
Is Allkem Ltd a Good Buy?
Based on 11 Buy and 1 Hold recommendations, AKE stock has a Strong Buy rating on TipRanks. The average target price is AU$15.94, implying a change of 23.4% from the current price level.
Conclusion
These two ASX stocks have garnered positive ratings from analysts. Allkem has received a Strong Buy rating and is expected to achieve growth of over 20%. On the other hand, analysts hold a moderately bullish view of Brambles’ stock, with an anticipated upside of 6%.
