Insights

2 ASX shares having a shocker that could be bargain buys right now

If you want genuine bargains, you need to take a punt on stocks that the rest of the market is ignoring.
The post 2 ASX shares having a shocker that could be bargain buys right now appeared first on The Motley Fool Australia. –

The old adage goes, you should buy ASX shares when they’re cheap, not when prices have already risen.

But how can you tell whether a stock is currently cheap because it’s underappreciated by investors, or if it genuinely represents a dud business?

Fortunately, there are professionals who evaluate that question for a living.

Here are 2 pummelled ASX shares that Stock Doctor analysts have picked that they believe are tempting buys at the moment:

Taliban’s takeover of Afghanistan was a headache for this stock

Shares for metal detection and communications equipment provider Codan Limited (ASX: CDA) have plunged more than 26% since its results announcement on 19 August.

Revenue and profits were up in the 2021 financial year, but the presentation also revealed chief executive Donald McGurk would retire within a few months.

The company also had military customers that were working in Afghanistan.

“The withdrawal of [US] troops from Afghanistan represents a marginal headwind to the communications segment,” analyst Jacob Simonsen told a Stock Doctor video.

“Despite this, we believe the share price weakness represents some opportunity, with earnings expected to grow by nearly 20% this year.”

Codan will hold its annual general meeting on Wednesday, where more information may come that might send its stocks one way or another.

Can one person justify a 22% drop in share price?

Shareholders for software company Infomedia Limited (ASX: IFM) have watched in horror as almost 22% has been wiped off the value in just the last 2 weeks.

On 18 October alone the shares lost 14% after chief executive and managing director Jonathan Rubinsztein quit.

Stock Doctor head of research Kien Trinh said the low liquidity for shares has also contributed to jerky price movements.

“The sudden resignation has led to share price volatility, but the company has reaffirmed its earnings guidance for the full year, with revenue expected to rise by about 23%,” said Stock Doctor head of research Kien Trinh.

“We remain optimistic about the business with earnings expected to remain intact for now, so possibly another opportunity for investors.”

Infomedia makes cloud software for clients in the automotive parts and services industry. Its annual general meeting is coming up on 25 November.

The post 2 ASX shares having a shocker that could be bargain buys right now appeared first on The Motley Fool Australia.

Wondering where you should invest $1,000 right now?

When investing expert Scott Phillips has a stock tip, it can pay to listen. After all, the flagship Motley Fool Share Advisor newsletter he has run for more than eight years has provided thousands of paying members with stock picks that have doubled, tripled or even more.*

Scott just revealed what he believes could be the five best ASX stocks for investors to buy right now. These stocks are trading at near dirt-cheap prices and Scott thinks they could be great buys right now.

*Returns as of August 16th 2021

More reading

Here are the top 10 ASX shares today

Which ASX 300 shares are the major movers today?

Why Audinate, Home Co Daily Needs, Infomedia, and Temple & Webster are falling

Infomedia (ASX:IFM) share price sinks 14% on shock resignation

2 small cap ASX shares with a lot of potential

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. owns shares of and has recommended Infomedia. The Motley Fool Australia has recommended Infomedia. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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