The ASX 50 index is where investors will find many of the highest quality companies that the Australian share market has to offer.
But which of these companies could be good options for investors right now? Let's take a look at two ASX 50 shares that analysts rate very highly:
CSL Limited (ASX: CSL)
The first ASX 50 share that we are going to look at is CSL.
It is one of the world's leading biotechnology companies, comprising the CSL Behring, CSL Vifor, and Seqirus businesses.
Over many decades, CSL has spent tens of billions on research and development (R&D) activities and acquisitions. This has led to the company owning a portfolio filled to the brim with high quality therapies and vaccines.
But management is never one to rest on its laurels. The company continues to invests 10%-11% of its sales revenue back into R&D each year. This means that CSL has a large number of potentially lucrative and life-saving therapies under development that will support its future growth.
The team at Citi has been bullish on CSL for some time and this remains the case today. Particularly given how recent industry commentary supports its view that immunoglobulin demand will grow strongly in the coming years. It said:
We attended Takeda's virtual Plasma-Derived Therapies (PDT) investor event. Takeda is expecting mid-to-high single digit volume growth for Immunoglobulin (Ig) over the medium-term despite the competition from FcRns – this is in-line with CSL's expectations and our forecasts.
Citi has a buy rating and $325.00 price target on its shares.
Telstra Corporation Ltd (ASX: TLS)
Another ASX 50 share that is highly rated by analysts is Telstra. It is of course Australia's largest telecommunications company.
Telstra went through a difficult period in the 2010s following the launch of the NBN. Pleasingly, that is all behind the company now and growth is back on the agenda thanks to the success of its T22 strategy and the launch of its successor – T25.
Commenting on the strategy, its CEO at the time, Andy Penn, said: "If T22 was a strategy of necessity, T25 is a strategy for growth."
Goldman Sachs appears to have confidence in the strategy based on its earnings growth forecasts. In addition, the broker highlights that this growth is low risk, which makes it even more appealing for investors. It said:
We believe the low risk earnings (and dividend) growth that Telstra is delivering across FY22-25, underpinned through its mobile business, is attractive. We also believe that Telstra has a meaningful medium term opportunity to crystallise value through commencing the process to monetize its InfraCo Fixed assets – which we estimate could be worth between A$22-33bn.
Goldman currently has a buy rating and $4.65 price target on Telstra's shares.
