Fund manager Wilson Asset Management (WAM) has recently identified two promising S&P/ASX 200 Index (ASX: XJO) shares it owns in one of its portfolios.

WAM operates several listed investment companies (LICs). Two of those LICs are WAM Capital Limited (ASX: WAM) and WAM Leaders Ltd (ASX: WLE).

There’s also one called WAM Active Limited (ASX: WAA) which looks at businesses it thinks are the most undervalued.

WAM says WAM Active invests in “market mispricing opportunities” in the Australian market.

The WAM Active portfolio has delivered gross returns (that’s before fees, expenses, and taxes) of 10.9% per annum since its inception in January 2008, compared to the Bloomberg AusBond Bank Bill Index return per annum of 2.8%.

These are the two ASX shares that WAM outlined in its most recent monthly update:

AMP Limited (ASX: AMP)

Wilson Asset Management describes AMP as a retail wealth management and banking business operating in Australia and New Zealand with more than 4,000 employees servicing approximately 1.5 million customers.

The fund manager noted that in April, AMP announced it had agreed to sell its funds management arm Collimate Capital’s real estate and domestic infrastructure equity business to DEXUS Property Group (ASX: DXS) and its international infrastructure equity business to DigitalBridge Investment Holdco.

WAM points out that the transactions value Collimate Capital’s business at up to $2 billion, significantly strengthening AMP’s capital position, with plans to use the proceeds to pay down its corporate debt and return capital to shareholders.

WAM believes the sales will allow AMP to focus on driving its ‘core’ banking and retail wealth businesses which can help improve its competitiveness.

In early May, AMP announced that the ASX share’s banking arm’s total loan book increased by $500 in the first quarter of the 2022 calendar year. WAM thinks this shows positive signs of growth.

The fund manager anticipates that the core AMP business will continue to perform “well” and unlock future growth as it completes these transactions.

Breville Group Ltd (ASX: BRG)

Breville describes itself as a leading small electrical appliances provider in the consumer products industry.

In April, the Breville share price declined, which was in line with the broad market exposed to consumer spending as risks of a pending recession intensified with inflation data worsening. WAM thinks this points to a weaker consumer environment.

However, the fund manager is positive on the Breville share price thanks to the company’s ability to continue expanding its addressable market and its long-term expansion plans to go into new geographies.

Breville said in an update in early May, that it was sticking with its FY22 earnings guidance and it’s on track to meet market expectations, with earnings before interest and tax (EBIT) of approximately $156 million for FY22.

WAM continues to believe that the company operates a high-quality business and remains optimistic about the opportunities it can unlock through its global rollout strategy.

The post Why these 2 ASX 200 shares are undervalued opportunities: WAM appeared first on The Motley Fool Australia.

More reading

• 3 ASX shares to buy in troubled times: expert panel
• 5 things to watch on the ASX 200 on Tuesday
• 2 top growth shares experts are tipping as buys in June
• Here are the top 10 ASX shares today
• Why this rich lister is buying ASX dividend shares that ‘pay you to wait’

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 no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. 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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We’re coming into the final month of the Australian tax year. June 2022 could be a good month to invest in some of the S&P/ASX 200 Index (ASX: XJO) shares that experts have picked out as opportunities.

Different brokers have different opinions on various ASX 200 shares. However, when several brokers all think a business is a buy then it could be worth paying attention to that optimism. Or they could all simultaneously be wrong!

After all of the recent volatility of the ASX share market, the below two picks are highly recommended right now.

BlueScope Steel Limited (ASX: BSL)

BlueScope is a large steel business with operations in Australia and the US.

It’s currently rated as a buy by at least five brokers, including Citi. The broker has a price target of $22.50 on the business. That implies a possible rise of the BlueScope Steel share price of more than 20% over the next year. Other brokers have even more optimistic price targets.

Citi points to strong steel prices in the US which means things are looking good for potential profit generation by North Star and the North American coated business.

The Australian steel division is also benefiting from strong steel prices and better than expected contributions from the downstream businesses. However, it has seen softer than expected domestic despatch levels, due to a range of supply chain disruptions including the flooding on the east coast, rail outages, and COVID-19 impacts.

However, the ASX 200 share expects ongoing strength in raw material prices, combined with supply chain disruptions.

It now expects underlying earnings before interest and tax (EBIT) for the second half of FY22 to be in the range of $1.375 billion and $1.475 billion, which was an upgrade from the previous range of $1.2 billion to $1.35 billion.

In early trading on Tuesday, the BlueScope Steel share price is down 2% to $18.14.

CSL Limited (ASX: CSL)

CSL is one of the largest companies on the ASX. The healthcare giant provides various products including protein-based therapies and vaccines.

It’s currently rated as a buy by at least five brokers, including Citi. The broker has a price target on the business of $335, implying a potential upside of more than 20% on the current CSL share price of $274.05.

The broker points to positives that could boost the CSL share price including the acquisition of Vifor Pharma and strong demand for its products. Earlier in May, the company told investors that the regulatory approval process will take “a few more months”.

Management is still confident of completing the acquisition. It’s looking forward to expanding its presence in the rapidly growing nephrology market, as well as leveraging the companies’ combined expertise.

Based on the current earnings estimates for CSL, Citi thinks the CSL share price is valued at 39x FY22’s estimated earnings and 31x FY23’s estimated earnings.

This ASX 200 share is expecting to generate net profit after tax (NPAT) in FY22 of between US$2.15 billion and $2.25 billion in constant currency terms.

The post Buy these 2 impressive ASX 200 shares in June 2022: experts appeared first on The Motley Fool Australia.

More reading

• Why is the CSL share price losing ground on Friday?
• Why I think these 3 ASX shares are top-quality buying at today’s prices
• After being stuck in the mud for 3 years, are CSL shares a buy today?
• The best 2 ASX shares money can buy right now: expert
• ASX shares paid out a record $98b in dividends in the 12 months to March. Which are the star performers?

Citigroup is an advertising partner of The Ascent, a Motley Fool company. 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 CSL Ltd. The Motley Fool Australia has no position in any of the stocks mentioned. 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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Barring a disastrous session on Tuesday, the Commonwealth Bank of Australia (ASX: CBA) share price looks set to beat the market in May with a modest gain.

With the CBA share price currently fetching $106.29, Australia’s largest bank’s shares are up 0.5% this month.

This compares favourably to a month-to-date decline of 3% by the ASX 200 index.

Why is CBA share price faring better than most this month?

The CBA share price was given a boost in the middle of the month when the bank’s third-quarter update impressed the market.

In case you missed it, for the three months ended 31 March, compared to the quarterly average during the first half, CBA reported a 1% decline in operating income to $6,103 million and flat cash earnings of $2,400 million.

While this may not look overly impressive on paper, it certainly was in comparison to the market’s expectations.

For example, a note out of Citi reveals that CBA’s cash earnings were 6% ahead of its expectations and 9% ahead of the analyst consensus estimate.

Upbeat commentary

Also giving the CBA share price a boost was management’s upbeat commentary with its update.

CBA’s chief executive officer, Matt Comyn, commented:

The March quarter underlined the disciplined execution of the Group’s strategy, focused on our core banking franchises, which delivered continued volume growth, sound portfolio credit quality and ongoing support for our customers and communities. [..] Looking ahead, we are well positioned to support business investment to build Australia’s future economy. Through disciplined execution of our strategic agenda, we will continue to deliver for our customers, communities and shareholders as we build tomorrow’s bank today.

Shareholders will no doubt be hoping that the CBA share price can continue outperforming during June. Time will tell if that is the case.

The post Why the CBA share price is beating the market in May appeared first on The Motley Fool Australia.

More reading

• The ANZ share price is ‘trading at its largest discount to its peers in 15 years’: Is this justified?
• What’s the outlook for ASX 200 dividend shares in the second half of 2022?
• Own Westpac shares? Here’s why the bank’s $45b super business is hitting headlines
• What’s the outlook for the CBA dividend in 2022 and 2023?
• ASX shares paid out a record $98b in dividends in the 12 months to March. Which are the star performers?

Motley Fool contributor James Mickleboro 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 no position in any of the stocks mentioned. 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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The last 30 days have been bright for the Immutep Ltd (ASX: IMM) share price.

The biotechnology company’s surge followed two announcements regarding its lead product candidate, efti.

At the time of writing, the Immutep share price is 41 cents. That’s 24% higher than it was this time last month.

For context, the All Ordinaries Index (ASX: XAO) has slipped 1.3% in that time. Meanwhile, the S&P/ASX 200 Health Care Index (ASX: XHJ) has lifted 1%.

Let’s take a closer look at what’s been driving the Immutep share price higher lately.

Immutep outperforms in May

The Immutep share price took off earlier this month when the company released biomarker and exploratory analysis findings from a study involving efti.

The company’s Phase IIb AIPAC trial evaluated efti in combination with paclitaxel chemotherapy in patients with HER2-negative or HR positive metastatic breast cancer. The results showed an increase in pharmacodynamic markers, which is linked to improved overall survival.

Immutep’s CSO and CMO Dr Frederic Triebel commented on the findings, saying:

The biomarker analysis is highly valuable for two key reasons. Firstly, the statistically significant difference in the immune response between the efti and placebo patients confirms efti is activating the immune system and helping patients live longer … Secondly, the early rise in absolute lymphocyte count in patients treated with efti provides clinicians with a potential predictor of improved survival, helping them to determine early on if continued treatment with efti is potentially beneficial.

The Immutep share price lifted 9% on the back of the release.

The second announcement from the company over the last 30 days dropped on Friday.

Then, Immutep told the market new interim data from Part A of its Phase II TACTI-002 trial had been published.

The news saw the company’s stock gain 2.5% and brokers at Wilsons retain their 91 cent price target and overweight rating on Immutep.

Immutep share price snapshot

Sadly, the Immutep share price’s strong month’s performance hasn’t been enough to boost it back into the year-to-date green.

The stock has tumbled 19.6% since the start of 2022. It’s also 41.4% lower than it was this time last year.

The post Why has the Immutep share price rocketed 24% in a month? appeared first on The Motley Fool Australia.

More reading

• 10-baggers? Expert names 2 super-cheap biotech ASX shares

Motley Fool contributor Brooke Cooper 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 no position in any of the stocks mentioned. 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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Oil, gas and energy prices will remain elevated in the medium term, making some ASX shares attractive for picking up now.

That’s according to a memo from the team at Wilsons, which noted energy markets were tight even before the war in Ukraine due to a lack of capital expenditure.

“Post-Ukraine, the market has become even tighter, and some of this lost production now looks as though it will be permanently removed from the global energy market,” read the Wilsons note.

“A stronger-for-longer outlook for oil and gas paints a bullish picture for energy stocks on the ASX.”

The team also likes that the energy sector has historically acted as a hedge against inflation.

Australian energy shares have also underperformed compared to their overseas peers, giving the sector further upside.

“We think this discount to global peers could be unwound over the next 12 months as companies’ and investors’ objectives become more aligned.”

So which is the stock that Wilsons analysts are the most bullish on?

‘Still one of the cheapest’ energy ASX shares

According to the memo, Santos Ltd (ASX: STO) is Wilsons’ pick if they were to choose one energy investment right now.

“Our most preferred Australian energy exposure is Santos,” read the note.

“We expect a re-rate from various catalysts over the next 12 months.”

These stock price catalysts include:

• A final investment decision on the Dorado field in Western Australia
• Potential sell-off of 15% to 51% of its asset in Alaska, USA
• Potential sell-off of about 10% of its asset in Papua New Guinea

“The sell-downs allow STO to deleverage and implement its new capital management strategy,” read the memo.

“This should substantially increase the capacity for further capital management over the next 12 months.”

The Santos share price is already up 24% so far this year, while also paying out a 2.38% dividend yield.

Despite the recent gains, Wilsons analysts are convinced there is “significant upside” if oil prices remain high.

“Santos is still one of the cheapest large cap energy stocks on the ASX – Santos is trading with the lowest implied oil price at US$63/bbl.”

The post Want to invest in energy? This is ‘our most preferred’ ASX share: Wilsons appeared first on The Motley Fool Australia.

More reading

• 5 things to watch on the ASX 200 on Tuesday
• Why is the Santos share price sliding on Monday?
• 5 things to watch on the ASX 200 on Monday
• Broker names 2 of the best ASX resources shares to buy now
• Here are the 3 most traded ASX 200 shares on Friday

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 no position in any of the stocks mentioned. 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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The Fortescue Metals Group Limited (ASX: FMG) share price has been on a disappointing run for the month of May.

In the past 30 days, the iron ore producer’s shares have tumbled by more than 8% in value. This puts the company as one of the weaker performers on the S&P/ASX 200 Index (ASX: XJO).

For context, the ASX 200 benchmark index has fallen just 2% in May.

At Monday’s market close, Fortescue shares recovered some lost ground to edge 1.33% higher to $19.85.

What’s happened to Fortescue’s stock?

There are a couple of reasons that have likely contributed to the recent fall in the Fortescue share price.

The price of iron ore tumbled after a strong bull run from November last year.

At the time of writing, the steel-making ingredient is trading at US$133.17. This represents a fall of 7.57% when compared to the beginning of May.

It’s worth noting that Fortescue could suffer particularly more than its peers as it produces a lower grade of iron ore.

Steel producers prefer higher quality iron ore, which miners Rio Tinto Limited (ASX: RIO) and BHP Group Ltd (ASX: BHP) supply.

Consequently, this puts a squeeze on Fortescue’s margins.

A number of brokers also weighed in on the Fortescue share price in May following the company’s March quarterly production report.

Bell Potter cut its outlook to sell from hold, and reduced its price target by 6.8% to $17.80 for Fortescue shares.

Analysts at Goldman Sachs had a more bearish sentiment, slashing its rating by 2% to $14.90.

Based on the current Fortescue share price, this implies a downside of 10% and 25%, respectively.

About the Fortescue share price

Over the past 12 months, Fortescue shares have declined by around 12%.

However, when looking at the year to date, they are up 3%.

Based on valuation grounds, Fortescue commands a market capitalisation of roughly $60.32 billion.

The post Why did the Fortescue share price lag the ASX 200 in May? appeared first on The Motley Fool Australia.

More reading

• The richest Aussies revealed (and the ASX shares they own)
• What’s the outlook for ASX 200 dividend shares in the second half of 2022?
• Why is the Fortescue share price tumbling 4% today?
• Are ASX 200 mining shares good options for dividends?
• Australia’s renewable energy output could triple by 2030 under Labor. Will that impact these ASX 200 shares?

Motley Fool contributor Aaron Teboneras 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 no position in any of the stocks mentioned. 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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I think there are some attractive ASX dividend shares that may be on track to pay high levels of shareholder payouts.

Businesses that have low price-to-earnings (P/E) ratios and also have relatively high payout ratios can translate into high dividend yields. This can really boost investment income for investors.

High dividend yields aren’t everything though. I also want to look for businesses where the earnings look compelling as well. Otherwise, a dividend yield can turn into a dividend trap. If a dividend is cut then the yield is obviously not as attractive anymore.

With that in mind, I think these are two ASX dividend shares with good-looking dividends.

Best & Less Group Holdings Ltd (ASX: BST)

Best & Less is an ASX retail share that has a national network of stores. Its main target customers are mums and families.

I think Best & Less has a promising future. The company is looking to grow in a number of different ways including growing its market share of the baby and kids market. It also wants to improve its apparel offering for women, increase its digital capabilities, and expand the store network.

It’s looking to both upsize existing locations as well as add between 15 and 25 net new stores over the next three years.

In my opinion, this ASX dividend share could see more customers attracted to its value offering if family budgets are getting tighter due to inflation. It recently updated the market to say that it was seeing sales growth in the fourth quarter of FY22.

How big could the dividend be? The broker Macquare has estimated a dividend which equates to a grossed-up dividend yield of 16%. Even if the yield is only 10%, that’s still a very good-looking yield in my opinion.

South32 Ltd (ASX: S32)

South32 is one of the larger ASX mining shares with a market capitalisation of almost $22 billion.

It produces a number of commodities including bauxite, alumina, aluminium, copper, silver, lead, zinc, nickel, metallurgical coal, and manganese.

Commodity prices are very hard to predict. However, an inflationary environment can be helpful for resource shares in my opinion.

This ASX dividend share is making good profit and cash flow right now, which is helping lift dividend payouts.

In the recent FY22 half-year result it increased its ordinary dividend by 521% to 8.7 US cents per share.

With the diversification and strength of South32’s commodities, I think its dividends can continue to be attractive in the medium-term.

The broker Macquarie thinks that South32 could pay a grossed-up dividend yield of 12.2% in FY23.

The post I think these 2 high-yield ASX dividend shares are buys in June appeared first on The Motley Fool Australia.

More reading

• Here are the 3 most traded ASX 200 shares on Monday
• Broker names 2 of the best ASX resources shares to buy now
• Brokers name 3 ASX shares to buy today
• Here are 2 ASX 200 dividend shares rated as buys by brokers
• Do South32 shares have exposure to ‘green metals’?

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 no position in any of the stocks mentioned. The Motley Fool Australia has recommended Macquarie Group Limited. 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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The Appen Ltd (ASX: APX) share price has been on a rollercoaster ride this month.

After rocketing higher briefly last week following a takeover approach (which was withdrawn hours later), the artificial intelligence data services company’s shares are now back where they started the month.

Where next for the Appen share price?

According to a note out of Bell Potter, its analysts believe the Appen share price is trading at around fair value.

The note reveals that the broker has retained its hold rating and cut its price target to $6.50.

This implies modest potential upside of 3% from the current Appen share price of $6.30.

What did the broker say?

Bell Potter appears to have been disappointed with Appen’s trading update which accompanied its takeover proposal announcement. In response, the broker has downgraded its earnings estimates for the coming years. It said:

We have downgraded our EPS forecasts by 5%, 5% and 4% in 2022, 2023 and 2024. The downgrades have been driven by revenue downgrades of c.1% and reductions in our margin forecasts.

Anything else?

Its analysts also highlight that they have changed their valuation method now. Rather than using peer multiples of the likes of Infomedia Limited (ASX: IFM) and TechnologyOne Ltd (ASX: TNE), Bell Potter believes the Appen share price should be partly valued on a PE ratio of 16x.

We have updated each valuation used in the determination of our price target for the earnings changes as well as market movements and time creep. We have also elected to move away from the comparable companies we were using to determine an appropriate multiple in the relative valuations – like Infomedia and Technology One – given the contrast in operating performance.

This ultimately led to its price target of $6.50. Which, given the limited upside from where the Appen share price now trades, means it is a hold for the broker.

The post Where next for the Appen share price after its takeover collapse? appeared first on The Motley Fool Australia.

More reading

• 5 things to watch on the ASX 200 on Tuesday
• Why Appen, Elders, Predictive Discovery, and Yancoal shares are dropping
• ASX 200 midday update: AGL demerger scrapped, A2 Milk jumps
• These are the 10 most shorted ASX shares
• Why Appen, Catapult, CSR, and Select Harvests shares are dropping

Motley Fool contributor James Mickleboro 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 Appen Ltd. The Motley Fool Australia has no position in any of the stocks mentioned. 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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Are you interested in adding some ASX growth shares to your portfolio next month? If you are, you may want to look at the two listed below that have recently been named as buys by analysts.

Here’s what you need to know about these ASX growth shares:

Nitro Software Ltd (ASX: NTO)

The first ASX growth share to look at is document productivity software company Nitro Software. It is the company behind the Nitro Productivity Suite. This product provides integrated PDF productivity and electronic signature tools to customers large and small and continues to grow in demand as the digital transformation accelerates.

Goldman Sachs is a very big fan of Nitro. This is due to its enormous growth potential over the long term. It commented: “We estimate Nitro can increase its TAM penetration from 0.15% to 1.4% by FY40 implying 9x uplift to Nitro’s current revenue base.”

Goldman has a buy rating and $2.35 price target on Nitro’s shares.

Webjet Limited (ASX: WEB)

Another growth share that could be in the buy zone in June is online travel agent, Webjet. After a couple of years of struggles because of the pandemic, a return to profitability is now on the horizon as travel booking volumes approach pre-COVID levels again.

Morgans has been pleased with the progress the company has made during the last two years and highlights that management “hasn’t wasted a crisis.”

It commented: “In our view, WEB hasn’t wasted a crisis and will come out of COVID with a materially lower cost base, consolidated systems and a large business in the US.”

In light of this, the broker recently retained its add rating on the company’s shares with a $6.55 price target.

The post Experts name 2 top ASX growth shares to buy in June appeared first on The Motley Fool Australia.

More reading

• These are the 10 most shorted ASX shares
• What’s boosting the Webjet share price 3% higher on Friday?
• Why is the Nitro Software share price leaping 8% today?
• Up 10% in 9 trading days, what’s going on with the Webjet share price?
• Is the Webjet share price an opportunity that can soar?

Motley Fool contributor James Mickleboro 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 Nitro Software Limited and Webjet Ltd. 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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In these volatile times, you may be nursing a portfolio of ASX shares that are looking pretty sick at the moment.

The S&P/ASX 200 Index (ASX: XJO) is down 5.4% so far this year, while it’s been even worse in the United States with the S&P 500 Index (INDEXSP: .INX) losing 13.3%.

And those index drops don’t even tell the story of individual stocks, many of which have fared far worse.

The combination of persistent inflation, rising interest rates, supply constraints, and a war in Europe is killing the market’s morale.

So it’s no wonder the experts can’t agree whether Australia and the US will end up in recession.

Can the central banks engineer a ‘soft landing’ or will everyone feel the cabin rocking?

Given this scary environment, three veteran fund managers were asked to name one stock each they would buy now to put in their bottom drawer.

Here’s what they said at the Future Generation Live event in Sydney last week:

Set to grow double-digits even without reopening recovery

Tribeca portfolio manager Jun Bei Liu picked ear implant maker Cochlear Limited (ASX: COH) as a “quality company that’s been sold off”.

“Earnings have been hurt by the pandemic. They couldn’t operate on new instalments around the world.”

Indeed, the Cochlear share price is still well below its pre-COVID highs, when it reached the $240s. The stock closed Monday at $224.77.

But Liu sees much hope in the medium term.

“Now with the world reopening, the earnings are looking incredibly strong,” she said.

“This company was going to grow double-digits [even] without the recovery earnings, regardless of whether there’s a recession happening.”

Demerger the best thing for everyone

Regal Funds chief investment officer Phil King likes the look of chemicals provider Incitec Pivot Ltd (ASX: IPL).

The company recently announced that it would separate its explosives and fertiliser divisions.

“The demerger’s very positive for both stocks in the long term,” said King.

“Better capital allocation and the management’s a lot more focused.”

Due to the unstable global security situation, he noted fertiliser prices are sky-high. Explosives prices are also rising due to a mining boom.

Creating two smaller companies could also make both more palatable for an opportunistic deal.

“In this environment, we think private equity could be very active,” King said.

“Splitting the company into two, both parts are very bite-sized.”

The Incitec Pivot share price has gained 7% so far this year.

Can this ASX share beat expectations for the first time?

Wilson Asset Management chief investment officer Geoff Wilson favours a stock that’s long been neglected by the market.

But Wilson predicted that, for the first time, engineering firm Worley Ltd (ASX: WOR) would beat analyst forecasts.

“In theory [the share price is] re-rating when it beats market expectations.”

Long-suffering Worley investors will be hoping Wilson is right.

The stock has risen a spectacular 34.5% for the year so far. But over the past five years, it has not performed, gaining only just over 30%.

Earlier this year, Worley’s own shareholders won a legal case against the company, after the full Federal Court agreed that a financial forecast in 2013 was inflated with no “reasonable grounds”.

The post 3 ASX shares to buy in troubled times: expert panel appeared first on The Motley Fool Australia.

More reading

• 5 things to watch on the ASX 200 on Tuesday
• Here are the top 10 ASX shares today
• Why this rich lister is buying ASX dividend shares that ‘pay you to wait’
• Here are the 3 most traded ASX 200 shares on Monday
• ASX 200 midday update: AGL demerger scrapped, A2 Milk jumps

Motley Fool contributor Tony Yoo has positions in Cochlear Ltd. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Cochlear Ltd. The Motley Fool Australia has recommended Cochlear Ltd. 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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