Here’s why Super Retail Group Ltd (ASX:SUL) and this ASX share could be dirt cheap right now…
The post Could these ASX shares be dirt cheap right now? appeared first on The Motley Fool Australia. –
The Australian share market may be trading at a record high, but that doesn’t mean there aren’t any bargains out there.
Two ASX shares that could be dirt cheap are listed below. Here’s what you need to know about them:
Bravura Solutions Ltd (ASX: BVS)
Despite rising by an impressive 16% since this time last month, the Bravura share price is still down 35% from its 52-week high.
The provider of software products and services to the wealth management and funds administration industries has had a difficult time over the last two years. This has been driven by Brexit and COVID-19 uncertainty.
Pleasingly, trading conditions appear to be improving. This led to the company recently reaffirming its guidance for FY 2021. It expects net profit after tax of $32 million to $35 million and second half revenue growth of 10% half on half.
Goldman Sachs was pleased with this update. In response, the broker retained its buy rating and lifted its price target on the company’s shares to $3.90.
Goldman Sachs continues to believe that Bravura has a compelling opportunity in the UK and Australia. It also expects its emerging microservices ecosystem strategy to transform the business to a subscription-based model and drive growth.
It estimates that the company’s shares are changing hands at 20x FY 2022 earnings.
Super Retail Group Ltd (ASX: SUL)
Another potentially cheap ASX share to look at is Super Retail. It is the retail conglomerate behind the BCF, Macpac, Rebel, and Super Cheap Auto brands.
It certainly has been on form in FY 2021. During the first half of FY 2021, it reported a 23% increase in half year sales to $1.78 billion and a 139% increase in underlying net profit after tax to $177.1 million.
It then followed this up with a trading update which recently revealed like-for-like sales growth of 28% for the first 44 weeks of FY 2021.
Goldman Sachs is also a fan of Super Retail. It currently has a buy rating and $15.00 price target on its shares.
It is forecasting earnings per share of $1.40 in FY 2021 and then 98 cents in FY 2022. With the Super Retail share price currently fetching $12.72, this means its shares are changing hands at 13x estimated FY 2022 earnings.
In addition, the broker is expecting dividends of 84 cents per share in FY 2021 and 59 cents per share in FY 2022. This represents very attractive fully franked yields of 6.6% and 4.6%.
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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 May 24th 2021