There are some All Ordinaries (ASX: XAO), or All Ords, ASX shares that have fallen heavily over the past year or so. I think that some of these beaten-up names could be some of the best opportunities to buy for a two-year or three-year timeframe.

The outlook for some ASX shares is looking a bit tougher than in 2021. However, I don’t believe that the poor conditions are going to last forever, which I think is how businesses are sometimes priced during a sell-off like the current period.

While retail is not the most defensive sector, I think there is the potential for investors to pick up shares at cyclical lows, and then ride the recovery back up again, though a turnaround could take a bit of time. That’s where being patient is a very useful trait. By 2025, I think both of these names can deliver share price growth of at least 30% as market sentiment returns and their growth plans are carried out.

Temple & Webster Group Ltd (ASX: TPW)

Temple & Webster is one of the leading online-only homewares and furniture retailers.

The Temple & Webster share price has fallen over 70% since mid-October 2021 and it’s down 37% in February 2023. I believe that the current level makes it an attractive time to invest.

Management point out that, over the longer-term, e-commerce in the Australian furniture and homewares category “remains highly under-penetrated” and that it has a “much larger addressable market to go after” with the categories of home improvement and trade and commercial.

The All Ords ASX share is seeing its underlying earnings before interest, tax, depreciation and amortisation (EBITDA) improve over time as it scales. The FY23 second quarter saw EBITDA generation of $5.2 million, while the FY22 second quarter saw EBITDA of $4.6 million.

While the FY23 half-year revenue was down, the business is expecting to return to double-digit revenue growth in the shorter term. Over time, the company expects to grow its EBITDA margin from 3.8% in FY22 to more than 15% over the long-term thanks to scale benefits.

Adairs Ltd (ASX: ADH)

Adairs is a somewhat similar business – it also sells homewares and furniture, though the range is smaller.

The Adairs share price is down 53% from June 2021 and it’s down 22% in February 2023.

This All Ords ASX share just released its FY23 half-year result, showing sales growth of 34.1% to $324.1 million, while earnings per share (EPS) went up by 22.2% to 12.7 cents. It also revealed that Adairs store floor space increased by 2.4%.

Adairs’ new national distribution centre has been “below expectations”, which has affected customer experiences, as well as “significantly higher cost of operations”. However, there are “early signs that operational outcomes are improving”. A new pricing model started in January 2023, which “will see average variable costs per unit dispatched reduce by 20%” compared to the FY23 first half level. Warehousing costs added $5 million compared to the first half of FY22.

The All Ords ASX share is working on reducing costs, while group sales in the first seven weeks of the second half of FY23 were up 1.8% year over year. It’s still expecting to make between $70 million to $80 million of earnings before interest and tax (EBIT) in FY23.

I think that the supply chain and inflation issues will improve over 2023, while total sales could seem more resilient in a downturn thanks to ongoing store growth and expansion efforts.

The post 2 ASX All Ords shares I think can make big returns by 2025 appeared first on The Motley Fool Australia.

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More reading

• ASX investors: 3 of the best Aussie dividend stocks to buy this year
• Top ASX small-cap shares to buy in 2023
• How a stock market crash could turbocharge my ASX share portfolio
• Adairs share price falls amid strong first half growth but guidance downgrade
• Why term deposits can’t compete with these 5 ASX dividend machines

Motley Fool contributor Tristan Harrison has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Adairs and Temple & Webster Group. The Motley Fool Australia has positions in and has recommended Adairs. The Motley Fool Australia has recommended Temple & Webster Group. 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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