Bell Potter names more of the best ASX 200 stocks to buy
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If you are searching for some new additions to your portfolio in May, then the ASX 200 stocks listed below could be worth a closet look.
They have both been named as favoured shares by Bell Potter for the month. These are the shares that the broker believes “offer attractive risk-adjusted returns over the long term.”
In addition, Bell Potter notes that when choosing its picks it considers the current macro-economic backdrop and investment environment, focusing on quality companies with proven track records, capable management, and competitive advantages.
You can read about the first three ASX 200 stocks on the list here. Let’s now take a look at two more of the broker’s top picks:
Arcadium Lithium (ASX: LTM)
If you’re looking to gain some exposure to the beaten down lithium industry before it rebounds, then Bell Potter thinks that Arcadium Lithium could be the one to buy.
Particularly given its diverse asset base, strong balance sheet, and production growth potential. It said:
LTM provides the largest, most diversified exposure to lithium in terms of mode of upstream production, asset locations, downstream processing and customer markets. It is a key large-cap leverage to lithium prices and sentiment, which we expect to improve over the medium term. The group has a strong balance sheet and growth portfolio.
Bell Potter has a buy rating and $10.40 price target on the lithium miner’s shares. Based on its current share price of $7.17, this implies potential upside of 45% for investors over the next 12 months.
Coles Group Ltd (ASX: COL)
Another ASX 200 stock that Bell Potter is tipping as a buy is supermarket giant Coles. The broker likes the company due to moderating costs, supply chain improvements, and its positive long term outlook. It explains:
Costs are expected to remain elevated but should moderate through FY24 and FY25 as general inflation tapers off. In the medium term, 1) higher immigration should support grocery spending, and 2) Coles is entering a period of elevated capex intensity as it reinvests to modernise its supply chain and to catch up to competitors on online and digital offerings, which should help Coles maintain its market position.
The broker currently has a buy rating and $19.00 price target on Coles’ shares. This suggests that potential upside of 18% is possible for the supermarket operator’s shares over the next 12 months. Bell Potter also expects a dividend yield of approximately 4.4% (and growing) from the company’s shares.
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Motley Fool contributor James Mickleboro owns Arcadium Lithium shares. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has positions in and has recommended Coles Group. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.