‘Offers value’: Experts pick 2 quality ASX shares to buy at a 40% discount

Don’t worry, you’re not the only one feeling this way.

This year has indeed been scary and confusing for investors of ASX shares. Inflation, interest rates, wars and the economy are all playing on our minds and we’ve seen most non-mining ASX shares plunge in value.

In uncertain times like these, one way to clear the head is to buy stocks of companies that are leaders in their markets and integral to the lives of Australians.

This reduces doubt around volatility of demand if the economy does go backwards from the pressures of rising mortgage repayments.

This week some experts picked out exactly two such ASX shares to buy right now:

A quality business going for cheap

Online jobs classifieds site Seek Limited (ASX: SEK) provides services that most adult Australians would have used at some stage.

The share price, though, has lost almost 40% so far this year.

For Catapult Wealth portfolio manager Tim Haselum, this dip just presents a golden buying opportunity.

“The shares have fallen from $24.64 on August 11 to trade at $20.96 on September 15. We believe Seek offers value at these levels,” Haselum told The Bull.

“Investors can consider buying this employment and education company on weakness, as it was recently trading below pre-COVID-19 levels at a time of tight labour markets.”

The drop in the Seek share price comes even as the underlying business is doing fine, according to Haselum.

“The company is investing in its IT systems. Revenue from continuing operations grew by 47% in fiscal year 2022.”

SG Hiscock portfolio manager Hamish Tadgell told The Motley Fool earlier this month that he’s warm on Seek shares after the recent discounting.

“The market’s clearly been debating how much this company could be priced or impacted for a recession… Seek did very well coming out of COVID, really tight labour markets. Everyone’s looking to put people on and jobs,” he said.

“We think it’s a quality business with some very strong longer-term growth prospects.”

Headwinds will pass soon

Australians love an outdoor lifestyle. And such recreation became even more popular during the COVID-19 years as the pandemic forced consumers to holiday within their own states.

Four-wheel-drive accessories provider ARB Corporation Limited (ASX: ARB), therefore, did very well out of the lockdown era. The stock skyrocketed a phenomenal 307% from March 2020 to November 2021.

But as the world shifted to a post-COVID lifestyle in 2022, ARB shares have dropped more than 44%.

Ouch.

Wilsons investment advisor Peter Moran isn’t too worried about ARB’s prospects though.

“This 4-wheel drive accessories supplier has been impacted by a shortage of new vehicles, supply chain issues and staff sick leave due to COVID-19,” he said.

“However, growth is expected to resume as these issues subside.”

Moran’s team is also a fan of the company’s expansion progress outside of Australia. 

“There is potential for additional growth through a recently announced commercial partnership with Toyota North America,” he said.

“This adds to its partnership with Ford, which is still in its early stages. We retain an overweight rating.”

The post ‘Offers value’: Experts pick 2 quality ASX shares to buy at a 40% discount 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(“#43B02A”, ‘background’, ‘#5FA85D’);
setButtonColorDefaults(“#43B02A”, ‘border-color’, ‘#43A24A’);
setButtonColorDefaults(“#fff”, ‘color’, ‘#fff’);
})()

More reading

• Top ASX dividend shares to buy in September 2022
• 2 discounted ASX shares I’d buy now and one I wouldn’t touch: expert
• 5 things to watch on the ASX 200 on Wednesday
• Morgans names 3 of the best ASX shares to buy in September
• Ready for a storm: 3 ASX 200 shares with ironclad balance sheets

Motley Fool contributor Tony Yoo 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 recommended ARB Corporation Limited and SEEK Limited. 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/7I4Kgu2