‘Attractively priced’: Why fund is excited by these 2 ASX 200 shares

Often the best wisdom from professional investors arises when they discuss ASX shares that have plunged in their portfolio, not the ones that have risen.

That’s because the analysts explain why they chose to retain or sell those stocks.

And if they are keeping the faith then it’s a great tip for other investors to buy, especially as the price has been discounted.

The portfolio managers at Elvest Fund, in a recent memo to clients, mentioned two S&P/ASX 200 Index (ASX: XJO) shares exactly in that situation.

Discounted stock despite great outlook 

The share price for construction products player Brickworks Limited (ASX: BKW) was down 1% in December, which the Elvest team felt didn’t justify “a positive update”.

“Brickworks announced expectations to deliver a record half-year result in its property division,” read the memo.

“Not long after delivering a strong FY22 result, Brickworks expects to grow its net property trust asset base by $450 million to $2.2 billion in the first half of FY23.”

As well as producing goods, Brickworks has substantial investments in real estate and fellow ASX-listed company Washington H Soul Pattinson and Co Ltd (ASX: SOL).

“Over the medium term, we see property underwriting Brickworks’ current market cap, leaving substantial residual value within its 26% stake in Washington H Soul Pattinson, as well as the building products division.”

The Brickworks share price has dropped 7.1% over the past year, leaving a dividend yield of 2.75%. 

According to CMC Markets, three out of five analysts that cover the stock recommend it as a buy. The remaining two rate Brickworks as a hold.

The reason why this travel stock is struggling and why it’ll surge again

Christmas fortunes for Corporate Travel Management Ltd (ASX: CTD) were opposite, with the share price dropping 10.9% over December.

In fact, the stock has plunged almost 30% over the past 12 months.

If you visit any airport in Australia at the moment, it’s obvious to see from the lengthy queues the travel industry is going gangbusters.

So what gives?

“Corporate Travel Management declined on news of leisure travel swamping airline capacity and therefore limiting availability for corporate travellers.”

But that just means more upside, as far as the Elvest team is concerned.

“As capacity returns, which we believe will occur over the next 12 to 24 months, so too will corporate travel, albeit in the midst of a challenging economic environment,” read the memo.

“Corporate Travel Management is attractively priced assuming recovery of pre-COVID activity over the coming years.”

Elvest’s peers broadly agree, with nine out of 12 analysts currently surveyed on CMC Markets recommending Corporate Travel shares as a buy.

The post ‘Attractively priced’: Why fund is excited by these 2 ASX 200 shares appeared first on The Motley Fool Australia.

(function() {
function setButtonColorDefaults(param, property, defaultValue) {
if( !param || !param.includes(‘#’)) {
var button = document.getElementsByClassName(“pitch-snippet”)[0].getElementsByClassName(“pitch-button”)[0];
button.style[property] = defaultValue;
}
}

setButtonColorDefaults(“#0095C8”, ‘background’, ‘#5FA85D’);
setButtonColorDefaults(“#0095C8”, ‘border-color’, ‘#43A24A’);
setButtonColorDefaults(“#fff”, ‘color’, ‘#fff’);
})()

More reading

• Could ASX 200 travel shares be set for a major boost in 2023?
• How ASX dividend shares can solve retirement income needs
• Top brokers name 3 ASX shares to buy next week
• Brokers name 3 ASX shares to buy now
• 5 things to watch on the ASX 200 on Friday

Motley Fool contributor Tony Yoo has positions in Corporate Travel Management and Washington H. Soul Pattinson and Company Limited. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Brickworks and Washington H. Soul Pattinson and Company Limited. The Motley Fool Australia has positions in and has recommended Brickworks and Washington H. Soul Pattinson and Company Limited. The Motley Fool Australia has recommended Corporate Travel Management. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

from The Motley Fool Australia https://ift.tt/6yDYJ3v