Morgans’ top large-cap picks for December 2025

The Australian economy continues to defy expectations of a sharper slowdown. Australia is benefitting from stronger trading-partner growth and renewed demand for critical minerals and gold.

However, domestic growth appears impeded by domestic constraints around productivity, energy prices and housing, and their contribution to structurally higher inflation compared to other developed economies.

This looks like manifesting in a higher “neutral” Australian interest setting than consumers and investors have become accustomed to in the last decade. 

Australian corporate earnings growth is expected to be slower and more cyclical than in global peers, with banks likely to face margin and credit-quality headwinds and some domestic defensives appearing expensive. Banks and the major defensives - supermarkets and telco - speak for a disproportionately large share of the ASX200.

Accordingly, we prefer a targeted portfolio approach, tilting toward what we believe are the best relative opportunities and the best risk/return profile, while reducing exposure to sectors caught in the expensive flight-to-defensives (banks, staples, telcos).

The Morgans ‘Best Ideas’ are our highest-conviction stock calls designed to deliver the most attractive risk-adjusted returns over the next 12 months.

This month, we refresh our large-cap selections, retaining CSL, Amcor, Woodside and Goodman Group, while adding REA Group, TechnologyOne, LGI, GPT and Flight Centre. 

We remove Corporate Travel Management and Collins Foods following stock-specific developments and valuation outcomes.

 Morgans' large cap best ideas

CSL Ltd (ASX: CSL)

• Category: Healthcare
• Earnings Risk: Moderate
• Price Target: $249.51
• DY (FY26): 2.6%
• PE (FY26): 17
• 12m TSR: 39%

Behring growth engine intact, cost savings aid sustained growth.

Amcor (ASX: AMC)

• Category: Industrial Goods
• Earnings Risk: Moderate
• Price Target: $15.20
• DY (FY26): 6.2%
• PE (FY26): 10
• 12m TSR: 26%

Defensive earnings profile at attractive valuation.

Woodside Energy (ASX: WDS)

• Category: Oil and Gas
• Earnings Risk: Moderate
• Price Target: $30.60
• DY (FY26): 6.0%
• PE (FY26): 18
• 12m TSR: 26%

Diversified global energy player. Execution best in class.

Goodman Group (ASX: GMG) 

• Category: Property
• Earnings Risk: Moderate
• Price Target: $36.30
• DY (FY26): 1.0%
• PE (FY26): 23
• 12m TSR: 21%

Leader in industrial property, strong balance sheet, growth drivers.

Additions

REA Group (ASX: REA)

• Category: Media
• Earnings Risk: Moderate
• Price Target: $247.00
• DY (FY26): 1.5%
• PE (FY26): 38
• 12m TSR: 31%

High-quality and leading online franchise: Market leadership in online property listings across Australia and India.

Proven pricing power: Management has demonstrable levers (e.g., yield increases) to offset volatility from volume declines. 

Improving outlook & opportunity: The recent share price pullback offers an entry point as the listings outlook is set to improve due to easier comparisons over the rest of the year (particularly 4Q).

TechnologyOne (ASX: TNE)

• Category: Technology
• Earnings Risk: Moderate
• Price Target: $34.50
• DY (FY26): 1.1%
• PE (FY26): 60
• 12m TSR: 19%

Consistent High Growth: TNE has a long history of meeting or exceeding growth expectations, with a recent shift towards 15-20% Profit Before Tax growth. 

Strong Compounding Earnings: The business is well-positioned to maintain this strong compounding earnings growth trajectory. 

Attractive Entry Point: The recent share price pullback post its FY25 result presents a more attractive entry point for this high-quality Software-as-a-Service business.

LGI (ASX: LGI)

• Category: Utilities
• Earnings Risk: Moderate
• Price Target: $4.84
• DY (FY26): 0.7%
• PE (FY26): 41
• 12m TSR: 19%

Renewables Specialist: LGI is a dedicated Australian operator focused on hybrid electricity sites (generation & battery storage). 

Accelerated Development: The group is pursuing an accelerated pipeline towards a target of 80+ MW of installed flexible capacity in the medium term. 

Strong Growth Ahead: With a strengthened balance sheet, LGI has a strong growth profile driven by project execution and expanding its portfolio via new developments.

GPT Group (ASX: GPT)

• Category: Property
• Earnings Risk: Moderate
• Price Target: $6.20
• DY (FY26): 4.5%
• PE (FY26): 16
• 12m TSR: 15%

GPT: One of Australia's largest diversified listed property groups, owning and managing a high-quality portfolio of retail, office, and logistics assets. 

Strategy Shift & AUM Target: GPT is making a "paradigm shift" to a capital-light, co-investment-led funds management model. 

Valuation Disconnect: The stock currently trades near its Net Tangible Asset and offers a 4.5% distribution yield and pricing in nominal value to the high-growth funds management business.

Flight Centre (ASX: FLT)

• Category: Travel and Leisure
• Earnings Risk: Moderate
• Price Target: $15.65
• DY (FY26): 3.7%
• PE (FY26): 13
• 12m TSR: 19%

FLT: is a global travel agency group that operates a diversified business across the Leisure (retail holidays) and Corporate (business travel). 

Accelerated 2H Growth Drivers: Profit growth is expected to accelerate in the 2H26, driven by improving macro-economic conditions. 

Attractive Valuation and Capital Return: The recently confirmed guidance slightly ahead of consensus, combined with FLT's cheap trading multiples and resumption of $200m share buyback. 

Removals

Corporate Travel Management (ASX: CTD)

Removed due to the recent market update with was worse than expected causing its stock to remain suspended. Our stock rating and forecasts have been placed under review pending the outcome of FY25 audited accounts. 

Collins Foods Limited (ASX: CKF)

The strong recent share price performance has seen the stock trade near our 12- month price target. With few short-term catalysts ahead, we remove the stock this month.