As earnings season rumbles on, two ASX shares that have generated positive results are HealthCo Healthcare and Wellness REIT (ASX: HCW) and MLG Oz Ltd (ASX: MLG).
Thanks to positive earnings results, both have received strong ratings from the team at Morgans.
Here is what the broker had to say.
HealthCo Healthcare and Wellness REIT
HealthCo Healthcare and Wellness REIT holds a $1.6 billion portfolio of 36 properties including hospitals, aged care, childcare, life sciences and research facilities as well as primary care and wellness assets.
In its HY26 results, the company reported:
- Revenue from ordinary activities up 6% to $30.5 million
- Revenue, including income from the share of losses/profits of equity accounted investees was down 51% to $14.7 million.
Additionally, the company could be set to pay a dividend yield of 9%.
Its share price has jumped almost 10% since Monday on the back of this news.
Following the results, the team at Morgans upgraded this ASX REIT to a speculative buy recommendation.
This included a price target of $1.05 per share.
From yesterday's closing price of $0.71, that indicates an upside of 47.8%.
HCW is edging towards a negotiated resolution for the Healthscope assets. Importantly, rent has been paid in full across the portfolio and HCW has executable agreements with alternative operators for all 11 hospitals – with new long-term leases at unchanged face rents (with incentives), should Healthscope breach the lease. Moderate gearing of 28.5% leaves HCW well-positioned to navigate the uncertain timing and gearing impacts from a managed decline to asset values.
MLG Oz
MLG Oz Ltd is a Kalgoorlie-based integrated mining services and resource asset management company.
It released HY26 Results on Tuesday that included:
- Statutory Revenue of $287.2 million, up 5.2%, compared to the prior corresponding period (pcp).
- Statutory Net Profit After Tax (NPAT) up 73.2% to $7.1 million (pcp $4.1 million).
- Pro-forma Earnings before Interest, Tax, Depreciation and Amortisation (EBITDA) of $36.5 million, up 24.5% on the pcp; pro-forma EBITDA margin of 12.8% (pcp 10.9%).
Its share price climbed higher on these results and is now up 23% year to date.
In a note out of Morgans, the broker increased its price target following these results to $1.20 (previously $1.00).
From yesterday's closing price of $1.07, that indicates a further upside of 12.15% for these ASX shares.
1H26 was ahead of expectations at all operating metrics. Earnings grew substantially (EBITDA +25% YoY) despite a relatively subdued top-line (+5%), which is indicative of a steady portfolio of haulage projects and a renewed focus on margins. MLG reinstated dividends which signals confidence in the outlook and the company's financial position.
The post Two ASX shares with big upside post earnings results appeared first on The Motley Fool Australia.
Motley Fool contributor Aaron Bell has no position in any of the stocks mentioned. 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 no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.
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