Are you a fan of growth stocks? If you are, then it could be worth looking at the two ASX 200 growth shares listed below.
That's because they have been named as buys by brokers and tipped to rise strongly from current levels.
Here's what they are saying about them:
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Neuren Pharmaceuticals Ltd (ASX: NEU)
The first ASX 200 growth share that could have major upside potential according to analysts is Neuren Pharmaceuticals.
It is a pharmaceuticals company that is developing new drug therapies to treat multiple serious neurological disorders that emerge in early childhood and have no or limited approved treatment options.
The company notes that all programs have been granted orphan drug designation in the United States. This designation provides incentives to encourage development of therapies for rare and serious diseases.
Bell Potter is feeling positive about the company's outlook. Especially given the potential of its NNZ-2591 product candidate, which is being trialled in children with Angelman syndrome. It explains:
We have updated our near-term forecasts to reflect the PRV sale timing and the assumption that NEU will internally fund multiple Phase 3 trials for NNZ-2591 over the next few years. Our BUY recommendation and $25.00 PT remains unchanged.
Roughly $10/share of our valuation is attributed to Daybue licensing income, hence our BUY recommendation is driven by a positive view on NNZ-2591. The next steps for NNZ-2591 are further FDA engagement on the Phase 3 design in PhelanMcDermid syndrome, likely in 1Q CY25, followed by starting the Phase 3 trial in CY25.
Bell Potter has a buy rating and $25.00 price target on its shares. This implies potential upside of over 100% for investors.
Nextdc Ltd (ASX: NXT)
Another ASX 200 growth share that could generate big returns according to analysts is NextDC.
It is a leading provider of innovative data centre outsourcing solutions, connectivity services, and infrastructure management software.
Morgans is a big fan of the company and believes it will benefit greatly from the artificial intelligence (AI) megatrend. It said:
Enjoying all the benefits of the AI growth opportunity with less volatility are the operators of data centres. Data centres are facilities that store, process, and manage the vast amounts of data foundational to AI, ensuring secure and efficient data flow, backup, and recovery. […] Digital Realty recently reported a record sales quarter during which it sold double the data centre capacity of its previous high and about four times more capacity than it usually sells in a quarter.
This reinforces our view that the significant demand for cloud computing and AI-related digital infrastructure is going to unpin attractive returns and long-term growth. […] Our preferred exposure is NEXTDC. It has 17 operational data centres in Australia and nearly a dozen under construction or about to be built across Australasia and Asia.
Morgans currently has an add rating and $20.50 price target on its shares. This suggests that upside of 37% is possible for investors over the next 12 months.
