18 Share Tips – 26th May 2025

Welcome to this week’s edition of 18 Share Tips – our weekly selection of top ASX shares, chosen by leading analysts, that we think are worth considering.

This week Remo Greco of Sanlam Private Wealth, Tony Paterno of Ord Minnett and Nathan Lodge of Securities Vault share their ‘Buy’, ‘Hold’ and ‘Sell’ recommendations.

Please note these share tips are simply recommendations and are in no way intended as financial advice.  These share tips are general advice and don’t take into account any individual’s financial situation. Investors are advised to seek professional financial advice before investing.

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Remo Greco, Sanlam Private Wealth

BUY RECOMMENDATIONS

BUY – Perpetual (PPT)

PPT has been in play for a long time and a list of suitors have failed to swallow up this business. Speculation exists that PPT is open to selling its wealth management business. If a successful sale occurs, PPT could clear its debt and provide the business with more options. Wealth Management’s funds under administration of $20.6 billion in the first half of fiscal year 2025 was up 8 per cent on the prior corresponding period. We believe transforming this business could unlock some decent value.

BUY – Dexus Convenience Retail REIT (DXC)

DXC is a listed property trust, which owns a portfolio of service stations and convenience retail assets across Australia. We calculate the value of the assets held by DXC is around $3.57 a share, however the price was trading at $2.96 on May 22. The recent dividend yield was about 7 per cent.  DXC offers potential for capital gains and low risk income, particularly if interest rates continue to fall.

HOLD RECOMMENDATIONS

HOLD – Aussie Broadband (ABB)

ABB is the fifth largest broadband services provider in Australia. It continues to post encouraging growth numbers while successfully controlling its costs. It has upgraded EBITDA guidance to range between $133 million and $138 million for full year 2025. The company recently began paying dividends and initiated a share buyback program – a clear sign the directors are confident the business outlook is sound and profitable.

HOLD – Goodman Group (GMG)

GMG is a global industrial property group. The latest growth is in the data centre space, where the group has identified about $10 billion of work around the globe. Although early, we expect the group may benefit from the Trump Administration’s plan to support US manufacturing. Such a move would require building industrial developments. This would fit into GMG’s core competency.

SELL RECOMMENDATIONS

SELL – Transurban Group (TCL)

The company generates revenue from toll roads in Australia, the United States and Canada. Average daily traffic across the group increased 1.8 per cent in the 2025 March quarter when compared to the prior corresponding period. The average was 2.5 million trips a day. Statutory revenue from ordinary activities of $1.833 billion was down 13.7 per cent in the half year ending December 31, 2024, when compared to the prior corresponding period. The company posted a statutory net loss after tax from ordinary activities of $15 million. Group debt is too high. In our view, other companies offer superior returns.

SELL – Commonwealth Bank of Australia (CBA)

The CBA is a quality company. The rapid rise in the share price is difficult to justify. The share price has risen from $144.41 on April 7 to trade at $172.50 on May 22. In our view, the shares are trading at a significant premium when compared to its major competitors. The CBA appeals for its established track record of generating strong profits and paying attractive dividends. However, at these levels, we believe the stock is more than priced to perfection and leaves little or no room for disappointment. A recent interest rate cut will ease the burden, but there’s plenty of borrowers still struggling in this cost-of-living crisis. Investors may want to take out some insurance by selling a portion of their shares.

Tony Paterno, Ord Minnett

BUY RECOMMENDATIONS

BUY – Woodside Energy Group (WDS)

First quarter production of 49.1 million barrels of oil equivalent in fiscal year 2025 was down 4 per cent on the fourth quarter of fiscal year 2024. This was due to weather impacts at the North West Shelf and unplanned outages at Pluto. The Scarborough Energy project remains on track for first LNG cargo in the second half of 2026. Woodside recently approved the Louisiana LNG development and is targeting first LNG in 2029. The company sustained production guidance of between 186 million and 196 million barrels of oil equivalent for full year 2025. The hard work appears to be done on a strategy reset. The company’s outlook is brighter.

BUY – Judo Capital Holdings (JDO)

This Australian lender focuses on small and medium size enterprises. After subdued loan growth in the third quarter of fiscal year 2025, Judo now expects gross loans and advances of between $12.4 billion and $12.6 billion at June 30, 2025. In the second half of 2025, the company continues to target net interest margins of between 2.9 per cent and 3 per cent. Noting the operating environment remains volatile, Judo continues to target profit before tax growth of 15 per cent in fiscal year 2025 when compared to the prior corresponding period. Assuming stable economic conditions, Judo is aiming for 50 per cent profit before tax growth in fiscal year 2026 in response to the bank benefiting from significant operating leverage.

HOLD RECOMMENDATIONS

HOLD – Sigma Healthcare (SIG)

Sigma and Chemist Warehouse merged in February 2025. The merge created a leading healthcare wholesaler, distributor and retail pharmacy franchisor. Recent market capitalisation put the stock in the top 50 on the ASX. The main profit driver is Chemist Warehouse, which appears to be trading strongly. The shares have risen from $2.76 on March 12 to trade at $3.065 on May 22.

HOLD – ANZ Group Holdings (ANZ)

The company reported a statutory profit after tax of $3.642 billion in the first half of fiscal year 2025, up 16 per cent on the previous half. Revenue of $10.995 billion was up 5 per cent. The institutional bank has been completely reshaped and derisked. The group’s New Zealand business remains high quality delivering high returns, but offers little growth, in our view. The challenge is to grow the group’s return on equity.

SELL RECOMMENDATIONS

SELL – Bank of Queensland (BOQ)

The bank’s first half result in fiscal year 2025 was 3 per cent ahead of consensus. Statutory net profit after tax of $171 million was up 13 per cent on the prior corresponding period. Investor focus remains on BOQ restructuring to a simpler specialist bank. Transformation to date is meeting targets, but we believe the execution risk remains high. Delivering the revenue needed to achieve a return on equity of 8 per cent appears optimistic, in our view.

SELL – Regis Resources (RRL)

Regis is the highest cost, shortest life gold miner under our coverage and is now unhedged. Regis is fully leveraged to the gold price, which can move in either direction. The company reported a net profit after tax of $88 million in the first half of fiscal year 2025 compared to a $92 million loss in the prior corresponding period. Gold production fell 11 per cent in the 2025 first half when compared to the prior corresponding period and gold sold was down 6 per cent. The stock has rallied strongly in calendar year 2025 and, in our view, is expensive compared to peers. The shares have risen from $2.58 on January 2 to trade at $4.96 on May 22. Investors may want to consider cashing in some gains.

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Nathan Lodge, Securities Vault

BUY RECOMMENDATIONS

BUY – Kaiser Reef (KAU) 

Kaiser presents a high risk, high reward gold opportunity, underpinned by its 100 per cent owned A1 gold mine and processing plant in Victoria. The mine is a high grade, narrow vein underground operation with historical production exceeding 620,000 ounces. The company is generating revenue from gold production while simultaneously investing in exploration and resource expansion. Recent operational improvements have boosted mining efficiency, with Kaiser reporting improved grades and consistent production levels. The vertically integrated model (owning both mine and mill) enables KAU to reduce costs and to respond rapidly to geological conditions. The company recently completed the acquisition of the Henty Gold mine in Tasmania.

BUY – Aguia Resources (AGR) 

AGR is advancing its 100 per cent owned Santa Barbara gold project in Colombia by starting surface diamond drilling. The project boasts high grade gold veins, with historical sampling revealing grades of up to 38.91 grams a tonne of gold amid an exploration target of between 1.5 million and 4 million ounces of gold. Aguia has secured $1.5 million in funding to expedite a 2500 metre diamond drilling program aimed at defining a maiden JORC-compliant resource by the end of 2025. A prime location, coupled with its high grade potential and ongoing development, positions Aguia for growth.

HOLD RECOMMENDATIONS

HOLD – Kincora Copper (KCC) 

This explorer is strategically positioned within Australia’s Macquarie Arc, a region renowned for its porphyry copper-gold potential. The company’s transition to a project generator model has facilitated partnerships, notably with AngloGold Ashanti, enabling extensive drilling programs across key projects like Nyngan and Nevertire South. Recent exploration at the Nyngan project has yielded promising porphyry-style mineralisation, indicating potential for significant discoveries. The company reported a net loss of $C578,000 (Canadian) for the three-month period ending March 31, 2025.

HOLD – Adelong Gold (ADG) 

The recent acquisition of the Lauriston Gold Project in Victoria — adjacent to Agnico Eagle’s world class Fosterville Mine — adds significant exploration upside. The company also holds the Adelong Goldfield in New South Wales and the Apollo Project in Victoria, where recent assays have confirmed high grade antimony gold mineralisation. Additionally, Adelong is progressing lithium exploration in Brazil’s Minas Gerais region.

SELL RECOMMENDATIONS

SELL – Commonwealth Bank of Australia (CBA) 

The share price recently continued its upwards trend to post all-time highs. The shares have risen from $87.26 on June 13, 2022, to trade at $172.50 on May 22, 2025. The price rally recently propelled its price/earnings ratio above 30 times, significantly surpassing its 10-year average of 17 times and positioning it as one of world’s most expensive banks. While CBA reported a robust unaudited cash profit of $2.6 billion in the third quarter of fiscal year 2025, increasing arrears in home loans, personal loans and credit cards signal potential stress among borrowers. At recent price levels, investors may want to consider taking some money off the table.

SELL – American West Metals (AW1) 

The company has been a disappointing performer, with its share price falling from 14 cents on May 22, 2024, to trade at 5.1 cents on May 22, 2025. The company has promising exploration assets in North America, including the Storm Copper and West Desert projects. However, AW1 reported a loss of more than $15 million in the half year ending December 31, 2024. Significant challenges remain moving forward.

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The above recommendations are general advice and don’t take into account any individual’s objectives, financial situation or needs. Investors are advised to seek their own professional advice before investing. Please note that TheBull.com.au simply publishes broker recommendations on this page. The publication of these recommendations does not in any way constitute a recommendation on the part of TheBull.com.au. You should seek professional advice before making any investment decisions.