In the vast landscape of ASX shares, investors often find themselves overwhelmed by the sheer number of options available. To streamline decision-making, Bell Potter has spotlighted two standout shares in its Core Portfolio, reflecting its top picks for the current market climate. This month, the broker is recommending Amcor and WiseTech Global to its clients.
Amcor: A Transformative Merger with Berry Global
Amcor (ASX: AMC) emerges as the first ASX share that Bell Potter considers a potential buy. The broker is optimistic about Amcor’s future, largely due to its merger with Berry Global, which is expected to be a pivotal move for the company. Bell Potter anticipates that this merger will not only drive robust earnings growth but also make Amcor less susceptible to economic cycles.
The broker’s investment thesis is clear:
The investment thesis for Amcor is based on its transformative merger with Berry Global, which positions the company for a period of significant growth and quality improvement. The merger is expected to drive two years of double-digit EPS growth, fuelled by an estimated $590 million in synergies, with 80% anticipated to be realised within the first 24 months.
Beyond immediate earnings growth, the merger is set to bolster Amcor’s resilience by increasing its presence in the defensive home & personal care and pharmaceutical sectors. This strategic shift is expected to create a more stable and predictable business model.
WiseTech Global: A Leader in Logistics Solutions
Meanwhile, Bell Potter remains highly optimistic about WiseTech Global Ltd (ASX: WTC), a renowned provider of logistics solutions software. The company has been included in Bell Potter’s best ideas list for the year, thanks to its promising growth outlook.
WiseTech’s appeal lies in its strong fundamentals, characterized by low churn levels and recurring revenue streams. The recent acquisition of E2open further enhances its growth prospects. According to Bell Potter:
WiseTech is a leading global provider of software solutions to the logistics industry, with its market-leading CargoWise One platform used by many of the world’s largest logistics providers. The company’s quality is underpinned by a highly predictable business model, with around 95% of its revenue being recurring and a customer churn rate of less than 1%.
This stability translates into consistent cash flow, paving the way for WiseTech to reduce its net debt to EBITDA ratio from approximately 3x in FY26 to 1.7x in FY27. Growth is anticipated to accelerate both organically, through a new commercial model, and inorganically, with the E2open acquisition opening doors to adjacent markets such as trade.
Implications for Investors
The recommendations from Bell Potter come at a time when investors are seeking stability and growth in an unpredictable market environment. Amcor’s strategic merger and WiseTech’s robust business model offer compelling opportunities for those looking to invest in companies with strong growth trajectories and resilience to market fluctuations.
As the market continues to evolve, these two shares represent a strategic choice for investors aiming to balance risk with potential returns. With Bell Potter’s endorsement, Amcor and WiseTech Global stand out as promising candidates for those seeking to enhance their portfolios.
Looking ahead, investors will be keenly watching how these companies execute their growth strategies and capitalize on the opportunities presented by their respective mergers and acquisitions. The coming months will be critical in determining the long-term success of these investments.
