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Brokers say these 2 top ASX shares are buys in 2022

Tyro is one well-liked business for 2022.
The post Brokers say these 2 top ASX shares are buys in 2022 appeared first on The Motley Fool Australia. –

There are some leading ASX shares that are rated as buys for 2022 by brokers.

Analysts are always on the lookout for opportunities that are good value and could generate attractive returns for investors.

Share prices are always changing and management are usually working on development plans.

These two businesses are deemed to be opportunities:

Tyro Payments Ltd (ASX: TYR)

Tyro is currently rated as a buy by at least three brokers, including Ord Minnett.

The broker has a price target of $4.30 on the business, which suggests a potential upside of more than 50%. Tyro continues to grow and Ord Minnett thinks that the ASX share can deliver growth in the second half of FY22 as well.

Tyro Payments has regularly been giving investors updates about the transaction value that is being processed through its systems.

In FY22, Tyro saw December (to 17 December) transaction volume growth of 38% to $2 billion. November growth was 43%. October growth was 34%. Both August and September saw growth of at least 20%, despite the lockdowns in both Sydney and Melbourne.

The ASX share says that it’s a tech company providing payments and business banking, taking on “the big guys”. Management say that the business is well positioned to continue to accelerate growth, with tailored payment solutions which is driving strong merchant base and transaction value growth.

There are a number of growth drivers for the business, including adding new ‘verticals’, increasing its market share of existing verticals and achieving operating leverage as platforms continue to scale which will help grow profit margins.

Temple & Webster Group Ltd (ASX: TPW)

Temple & Webster is currently rated as a buy by at least three different brokers, including Credit Suisse.

The broker has a price target on the furniture and homewares business of $15.89. That’s more than 50% higher than where it is today.

A key highlight for the broker is the ongoing fast growth of sales despite the large amount of growth already experienced in FY21.

Management say that the business continues to experience strong tailwinds, including the ongoing adoption of online shopping due to structural and demographic shifts. Management also say the company is a long-term growth story.

For the period of 1 July to 15 October 2021 it saw growth of sales 56%. Whilst the full year earnings before interest, tax, depreciation and amortisation (EBITDA) margin is expected to be between 2% to 4%, the first half is expected to be higher than this level.

The ASX share says that as its scale increases its operating leverage, it will allow for an acceleration of investment in future growth and taking market share. It’s investing in things like marketing, technology development, product range and the overall customer experience.

Increasing scale will help with costs like product sourcing, logistics and marketing.

This business has the ultimate goal of becoming the largest retailer (online and offline) for furniture and homewares in its home market.

The post Brokers say these 2 top ASX shares are buys in 2022 appeared first on The Motley Fool Australia.

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More reading

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Forget Christmas! Could these ASX retail shares be set for a Boxing Day bonanza?

How will ASX retail shares go in 2022?

2 fantastic ASX tech shares tipped for big things in 2022

Could 2022 be the year ASX 200 tech shares get some love?

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. owns and has recommended Temple & Webster Group Ltd and Tyro Payments. The Motley Fool Australia has recommended Temple & Webster Group Ltd and Tyro Payments. 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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