This month could be a great time for investors to look at ASX shares that have been rated as buys by leading brokers.
As we know, the share prices of businesses on the ASX are changing all the time, so opportunities can open up quite quickly.
Brokers are always on the lookout for opportunities so let's take a look at what stocks top analysts currently rate as buys:
Insignia Financial Ltd (ASX: IFL)
Insignia Financial, which used to be called IOOF, is a business which aims to create financial wellbeing for Aussies. This company owns a number of financial brands, including MLC.
Citi currently rates it as a buy, with a price target of $5.20. That suggests a possible increase in the share price of more than 40% over the next several months.
On Citi's numbers, the Insignia share price is valued at 11x FY22's estimated earnings with a projected grossed-up dividend yield of 10.25%.
In the first quarter, Insignia noted that it continued to see growth in funds under management and administration (FUMA). At 30 September 2021, the group FUMA increased by $2.4 billion to $321.1 billion. Funds under administration rose $1.8 billion and funds under management increased $0.6 billion. Market growth more than made up for the net outflows that each division suffered.
Management boasted strong early momentum since the acquisition of MLC with the progression of its transformation program. The ASX share said that its synergy goals of $218 million per year by the end of FY24 and a run-rate of between $80 million to $100 million in FY22 are on track.
The company is evaluating the potential of accelerating synergies, though this would come with extra costs. It will tell the market about this analysis by the time of its FY22 half-year result.
Austal Limited (ASX: ASB)
This business designs, constructs and supports advanced defence and commercial vessels for the world's leading operators.
A few different brokers currently rate it as a buy, including Credit Suisse. This broker has a price target on the Austal share price of $2.50 – that's almost 30% higher than where it is right now.
An important win for Austal could be taking on a lease in the San Diego docks in the US.
Austal said its USA division will use the 15-acre site to focus on ship repair for the US Navy, Military Sealift Command, and Coast Guard ships. The site is immediately adjacent to the US Naval Base San Diego, which will include a newly-built dry dock designed specifically to handle small surface combatants and other small to medium size ships.
The ASX share will establish a full service ship repair capability, providing maintenance and modernisation for small surface combatants, autonomous vehicles, and other vessels. Services will include technical and material support, topside work, and dry docking availabilities.
The lease has a duration of 27 years and the deal is estimated to be worth around A$112.5 million.
Recently, the company announced it had been awarded a A$100.4 million contract by the US Navy to perform maintenance on Littoral Combat Ships deployed to the Western Pacific and the Indian Ocean. This contract could increase to around A$299 million if options for further periods are exercised.
According to Credit Suisse, Austal is valued at under 10x FY22's estimated earnings with an estimated FY22 dividend yield of 5.25%.
