2 ASX companies about to explode in the US market: experts

When you’re focused on researching, buying and selling ASX shares, it’s easy to forget that there’s a whole vast world outside of this big brown land.

For example, just the United States of America has 330 million people. That means there could be 13 Australias and there would still be more Americans on the globe!

So it’s an exciting prospect when a local business starts expanding overseas.

Sure, there are many risks. But if the product or service was compelling enough to get Australians to spend, there is no reason why those ASX companies can’t do the same in a bigger pond.

Recently analysts at Wilson Asset Management named two ASX shares to buy that might just take off with international growth:

Revenue will impress in 2023

Wilson senior equities dealer Cooper Rogers rates Johns Lyng Group Ltd (ASX: JLG) as a buy at the moment.

The business takes on repair work commissioned by insurance companies. That industry has seen an increase in claims in recent times arising from extreme weather events.

“While we never like to celebrate catastrophic events, it’s definitely an opportunity for Johns Lyng Group,” he said in a WAM video.

“They recently acquired Reconstruction Experts in the US.”

The American arm will be operated out of Florida, and Rogers reckons the expansion “is a great opportunity”.

“It’s also no secret that cat [catastrophic] events are also contributing to the revenue line for JLG in Australia,” he said.

“We think the cat revenue is going to impress in FY2023.”

Investment in the US expansion will be required in the current financial year, but Rogers expects revenues from that division will start flowing in during FY2024.

“So JLG is a buy for us.”

The Johns Lyng share price is down more than 21% year to date.

Kiwi takes flight

Tourism Holdings Ltd (ASX: THL) is a New Zealand company that only this month listed on the ASX after a merger with Apollo Tourism & Leisure Ltd (ASX: ATL).

Wilson senior equity analyst Shaun Weick urged investors to “get out there and get amongst it”.

“Tourism Holdings is a buy for us,” he said.

“They’re the largest RV [recreational vehicle] operator across Australia and New Zealand following the recent regulatory approval of the merger.”

Despite rising interest rates, Weick’s team reckons both domestic and international tourism demand will remain strong over the next 12 or 18 months.

“You look at the combination of the softer Australian dollar and the ongoing shift we believe will occur from goods towards services, we think this business can generate over $80 million profit after tax.”

And what’s more, the share price seems to be a bargain.

“It’s trading on a sub-10 times PE,” said Weick.

“The balance sheet‘s in great shape, great management team. We see expansion into North America as a medium-term opportunity for these guys.” 

The post 2 ASX companies about to explode in the US market: experts appeared first on The Motley Fool Australia.

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Motley Fool contributor Tony Yoo has positions in Johns Lyng Group. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Johns Lyng Group. The Motley Fool Australia has recommended Johns Lyng 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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