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Latest “buy” ideas for 2020 from top brokers

Brendon Lau
Santa rally

This is a good time to be thinking about how to reposition your portfolio for 2020 with the New Year fast approaching.

Investors should undertake a review at least once every quarter to clear out the junk and make way for new stocks in their portfolio.

The latest “buy” recommendations by leading brokers may give those with extra capital to put to work some ideas on what to invest in for 2020.

Hot property

One undervalued stock to put on your Christmas wish list is the Charter Hall Group (ASX: CHC) share price, according to JP Morgan.

The broker recommenced coverage on the office property group with an “overweight” recommendation and $14.20 a share price target.

“CHC’s earnings outlook has improved over the last 3-4 months and its shares are materially under-valued,” said the broker.

“Based on our review of each of CHC’s ~45 funds, we lift our forecast Assets under Management (AuM) to ~$50bn by the end of FY22.”

What’s more, JP Morgan believes management will beat its earnings per share (EPS) guidance for FY20 – and by a wide margin.

It’s not lithium, stoopid

Another stock worth considering is Mineral Resources Limited (ASX: MIN), if the analysts at Macquarie Group Ltd (ASX: MQG) is on the money.

Weak lithium prices may have weighed on the Mineral Resources share price, but the broker thinks this is a non-issue for the company.

“The 2QFY20 spodumene price was slightly lower than we had expected, and we see further weakness in spodumene pricing into CY20 but note that Mt Marion accounts for only 2% of our NPV [net present value],” said Macquarie.

“We believe there is upside risk to MIN’s $280-300m in EBITDA [earnings before interest, tax, depreciation and amortisation] guidance for the Mining Services business.”

Macquarie reiterated its “outperform” recommendation on Mineral Resources with a $19.40 a share target price.

Shining bright into 2020

Citigroup is keeping its “buy” recommendation on Northern Star Resources Ltd (ASX: NST) after the gold miner announced it’s undertaking a capital raise and buying a stake in the “Super Pit” in Kalgoolie.

While there are operational and execution risks associated with the transaction, Northern Star’s 50% ownership of the asset gives it entry to the coveted “One Million Ounces” club. All emerging gold miners strive to reach such production levels as it establishes them as a miner of significant scale.

The broker has a price target of $12.40 a share.

The post Latest “buy” ideas for 2020 from top brokers appeared first on Motley Fool Australia.

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Motley Fool contributor Brendon Lau owns shares of Macquarie Group Limited. Connect with him on Twitter @brenlau.

The Motley Fool Australia owns shares of and has recommended Macquarie Group Limited. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

The Motley Fool's purpose is to help the world invest, better. Click here now for your free subscription to Take Stock, The Motley Fool's free investing newsletter. Packed with stock ideas and investing advice, it is essential reading for anyone looking to build and grow their wealth in the years ahead. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson. 2019