Insights

3 ASX shares this top fund managers thinks are buys

Spheria Emerging Companies Ltd (ASX:SEC) has identified 3 ASX shares that it believes are good buys right now.
The post 3 ASX shares this top fund managers thinks are buys appeared first on The Motley Fool Australia. –

Spheria Emerging Companies Ltd (ASX: SEC) has identified a few ASX shares that it believes are opportunities at the moment.

What is Spheria Emerging Companies?

This is a listed investment company (LIC) that is managed by Spheria Asset Management.

It tries to look at the smaller end of the market for opportunities to beat the market.

Spheria Emerging Companies has been successful with that goal. Over the last year the LIC’s net portfolio performance has been a return of 29.8%, outperforming the S&P/ASX Small Ordinaries Accumulation Index’s return of 17.2%. Since inception in November 2017, the net return has been 9.1% per annum – superior to the benchmark return of 7.4% per annum.

The LIC owns a number of interesting ASX shares in its portfolio such as Fletcher Building Limited (ASX: FBU), HT&E Ltd (ASX: HT1), Blackmores Limited (ASX: BKL), Healius Ltd (ASX: HLS), Adbri Ltd (ASX: ABC) and Class Ltd (ASX: CL1).

These are manager’s latest thoughts on some ASX shares it thinks are opportunities:

Seven West Media Ltd (ASX: SWM)

Seven West was the largest contributor to the Spheria Emerging Companies portfolio in February. Spheria said this was thanks to reporting a result that was well ahead of market expectations as television advertising returned to growth during the fourth quarter of the 2020 calendar year. Costs were better that expected and the balance sheet was improved.

A deal about news with Google will also add to revenue and profit. Spheria believes that stronger viewer numbers should help increase revenue and potential news about the divestment of studios and/or towers may also help.

Despite the strong share price movement recently, Spheria said that the Seven West valuation is on a cheaper valuation multiple compared to its nearest listed peer.

Corporate Travel Management Ltd (ASX: CTD)

Corporate Travel was another strong performer last month. Spheria pointed to the “respectable” result, low cash burn and increasing market share as reasons to be positive. The acquisition of the US business Travel & Transport was also a factor.

The LIC believes that Corporate Travel Management is positioned to return to good profitability once the western world emerges from travel restrictions due to COVID-19. The ASX share still has many months of liquidity at the current cash burn rate.

Vista Group International Ltd (ASX: VGL)

Vista was another holding that returned over 20% during the month.

Spheria explained that Vista dominates the market for software in the global cinema exhibition, distribution and production markets.

Vista has been hit hard by the COVID-19 pandemic because of the amount of cinemas that have been closed over the past year. However, the ASX share has been able to keep the cash burn to a low level, according to the fund manager. It still has 20 months of liquidity left at the current burn rate, which should improve as vaccines are rolled out in markets like North America, Europe and the UK.

The thinking behind the LIC’s choice of Vista is that it believes it’s well placed to return to strong levels of profitability as the pandemic wanes. At around 2.5x historical revenue, Spheria believes the business is undervalued if it can return to prior levels of earnings.

Where to 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 are the five best ASX stocks for investors to buy right now. These stocks are trading at dirt-cheap prices and Scott thinks they are great buys right now.

See The 5 Stocks

*Returns as of February 15th 2021

More reading

Motley Fool contributor Tristan Harrison has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of and has recommended Blackmores Limited and Corporate Travel Management Limited. The Motley Fool Australia owns shares of Class Limited and Vista Group Intl. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

The post 3 ASX shares this top fund managers thinks are buys appeared first on The Motley Fool Australia.

Trade The World Anywhere & Anytime!

Mobile app platform with over 50,000 global listed securities across 12 markets (over 70% global market capitalisation), right from your Android or iOS device.

Integrated with exclusive trading idea and investment analysis tools to help you find actionable insight on virtually every financial instrument across our 12 global markets, to help you optimise your trading strategies.

Refer Your Friends

Tell your friends about Monex and gift them FREE access to our trading tools.

We respect your privacy and will only send this one email notification to your friends. 

Share With Your Friends

Share on facebook
Share on twitter
Share on linkedin

Monex Trading Tools Access and Usage Terms

The Monex Trading Tools (referred to as ‘tools’ hereafter) are available to you inside your client portal;


To activate access to the tools, you must have a verified and approved trading account and have made a deposit of at least AUD $1000.


An active and funded account with a positive trading balance is required to continue to have access to the tools;


Although the tools are available to you indefinitely, Monex Securities may at it’s discretion disable access to the tools in the future;


Monex securities reserves the right to change these terms and conditions from time to time, as it sees fit, without notice.

Important Notice
iOS & Android App - 12 International Markets & Over 70% Global Market Cap. $0 Brokerage On US Trades. Click Here!