Brokers think these 2 top ASX shares are buys in September 2021

Leading brokers believe that these 2 ASX shares could be buys.

| More on:
ASX shares Business man marking buy on board and underlining it

Image Source: Getty Images

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

Brokers have had their say about which ASX shares look like good value and could be worth looking at.

These brokers are always on the lookout for opportunities to make good returns. Share prices are changing every day and every week, so they can suddenly become good value if they fall in price or their prospects improve.

Some businesses are rated as buys by several brokers at once. These two ASX shares are heavily liked by brokers at the moment:

Seven Group Holdings Ltd (ASX: SVW)

Seven Group is currently rated as a buy by at least four brokers. Credit Suisse is one that rates Seven Group as a buy, with a price target of $26.25. That means the broker is suggesting the share price could rise more than 20% over the next 12 months.

This is a diversified business which operates across several areas. In industrial services, WesTrac is the sole authorised Caterpillar dealer in Western Australia, New South Wales and the ACT. It also owns Coates High, the largest equipment hire in the business and AllightSykes, a supplier in lighting towers, generators and pumps. The ASX share also owns around 70% of Boral Limited (ASX: BLD).

Seven Group has a growing presence in oil and gas in Australia and the US, as well as a 30% stake in Beach Energy Ltd (ASX: BPT). Finally, it owns around 40% of Seven West Media Ltd (ASX: SWM).

Credit Suisse notes that both WesTrac and Coates are expected to deliver growth in FY22, with continuing growth which could increase in future financial years. This guidance assumes lockdowns and restrictions are not prolonged or too restrictive.

In FY21, Seven Group saw trading revenue growth of 6.1% to $4.8 billion, underlying earnings before interest and tax (EBIT) growth of 7.3% to $792.1 million and operating cashflow growth of 15.6% to $622.4 million.

Credit Suisse thinks Seven Group is valued at 9x FY23's estimated earnings.

Audinate Ltd (ASX: AD8)

Audinate is the provider of the Dante audio over IP networking solution which is used in the professional live sound, commercial installation, broadcast, public address and recording industries.

The company's selling point is that Dante replaces traditional analogue audio cables by transmitting synchronised audio signals across large distances to multiple locations at once, using an ethernet cable.

The ASX share is currently rated as a buy at least three brokers. One of those brokers is UBS, which has a price target on the business of $11.75, which implies the Audinate share price could rise by more than 15% over the next 12 months.

UBS noted that Audinate thinks pre-COVID growth rates will return for the business, despite all of the COVID-19 impacts and logistics problems relating to the supply chain. Dante video could be an important factor for winning over more clients and growing revenue.

In FY21, Audinate generated revenue growth of 22.5% to US$25 million. Gross profit grew by 23.1% to US$19.2 million. Earnings before interest, tax, depreciation and amortisation (EBITDA) surged 50.1% to $3 million. The net loss after tax was $3.4 billion, 17% better than FY20. Its operating cashflow grew 40% to $6.7 million.

The company is hoping to drive further design wins for Dante video and launching new products. It also wants to improve Dante adoption by non-English speakers, strengthen products against cyber issues and implement business scalability initiatives.

UBS thinks Audinate will start making a bottom line net profit in FY23.

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. owns shares of and has recommended AUDINATEGL FPO. The Motley Fool Australia owns shares of and has recommended AUDINATEGL FPO. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

More on Broker Notes

Business man at desk looking out window with his arms behind his head at a view of the city and stock trends overlay.
Broker Notes

Leading brokers name 3 ASX shares to buy today

Here's why brokers believe that now could be the time to snap up these shares.

Read more »

Sell buy and hold on a digital screen with a man pointing at the sell square.
Broker Notes

Take your profits and run! Brokers say sell these 3 ASX 200 shares

Experts say these ASX 200 stocks are trading at high share prices with limited upside potential from here.

Read more »

Person handing out $50 notes, symbolising ex-dividend date.
Broker Notes

Where to invest $20,000 into ASX 200 shares

Brokers think these shares could be top picks for Aussie investors.

Read more »

Woman in celebratory fist move looking at phone
Broker Notes

Top brokers name 3 ASX shares to buy next week

Brokers gave buy ratings to these ASX shares last week. Why are they bullish?

Read more »

Man jumps for joy in front of a background of a rising stocks graphic.
Broker Notes

These ASX 200 shares could rise 20% to 50%

Looking for big returns? Brokers think these shares could do the job.

Read more »

A young man sits at his desk working on his laptop with a big smile on his face.
Broker Notes

Brokers name 3 ASX shares to buy today

Here's why brokers are feeling bullish about these three shares this week.

Read more »

man thinking about whether to invest in bitcoin
Broker Notes

Why Macquarie expects this ASX 200 dividend stock to keep outperforming

Macquarie has tipped this ASX 200 dividend stock to outperform. Let’s find out why.

Read more »

A man clenches his fists in excitement as gold coins fall from the sky.
Broker Notes

These ASX 200 shares could rise 20% to 35%

These shares are being tipped to deliver market-beating returns by analysts.

Read more »