Insights

Expert reveals 2 ASX shares to buy during lockdown

More than 5 million people are staying home in Sydney. This means there could be some companies that will benefit.
The post Expert reveals 2 ASX shares to buy during lockdown appeared first on The Motley Fool Australia. –

All eyes are on Australia’s largest city to see how it will defeat the dangerous COVID-19 delta variant.

The sight of 5.3 million people in prolonged lockdown has taken investors back to last year, when they sought to find ASX shares winning from people staying at home.

However, Tribeca Investment Partners portfolio manager Jun Bei Liu said that the current Sydney lockdown is slightly different to the 2020 scares.

“We didn’t have vaccines [last year],” she told Switzer TV Investing.

“As soon as we come out of this, the recovery will be enormous… I really believe that, investors, you just need to be a little bit more patient as we pass this.”

Having noted this, Liu reckoned a couple of ASX shares still look ripe for the picking right now while Sydneysiders are trapped at home.

The ASX share that’s doubled in 5 years and pays a 5.7% dividend

Despite it having a network of physical stores, JB Hi-Fi Limited (ASX: JBH) was a pandemic beneficiary.

Last year, Australians bought up appliances and homewares to make their houses and home offices more comfortable during the first wave of the virus.

But JB Hi-Fi shares have slumped more than 5.5% this year.

“JB Hi-Fi has been sold off as the reopening of the economy got people excited… at the same time the consumer stimulus [wound] back,” said Liu.

However, she thinks the appliances seller is in a prime position now.

“JB Hi-Fi’s in a good situation at the moment with Sydney lockdown, potentially for a prolonged period of time. That certainly benefits a lot of their short-term earnings,” Liu said.

“At the same time, we’re expecting the government to step up and give more stimulus.”

Even without the Sydney restrictions, Australians still can’t travel freely. Therefore there’s still plenty of money to flow into the consumer sector, according to Liu.

“JB Hi-Fi is the one that actually looks pretty good heading into the reporting season [in August],” she said.

“Most people are expecting earnings to fall next year significantly. I think people are way too bearish with that kind of forecast… On a 2-year view, this is a structural leader.”

The JB Hi-Fi share price has doubled in the past 5 years, going from $23.33 to more than $47 this week. Incredibly, the stock also gives out a 5.73% dividend yield.

“And it’s not expensive — that is the key. In today’s market, if you want to buy quality businesses you have to pay up big multiples for them.”

JB Hi-Fi stocks are currently trading on a price-to-earnings (P/E) ratio of around 12.

What’s your favourite activity during lockdown?

Liu also liked the look of media conglomerate Nine Entertainment Co Holdings Ltd (ASX: NEC).

“It offers exposure to Stan, which is a very fast-growing streaming service,” she said.

“At the same time, it gives you exposure to Domain Holdings Australia Ltd (ASX: DHG), which is going through a really good purple patch at the moment where [real estate] listings are going very strong.”

Nine shares are up 13.6% for the year, trading for $2.64 on Tuesday afternoon. But they were above $3 in late June, so Liu feels like this is a lockdown buying opportunity.

“What do you think everyone’s doing? Sitting at home watching TV!” she said.

“The feedback we have from advertising, especially the TV market, has been incredibly strong. Just because people really don’t have many places to go to. And all the corporates are spending that money to build their brand.”

The post Expert reveals 2 ASX shares to buy during lockdown 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 May 24th 2021

More reading

Why the JB Hi-Fi (ASX:JBH) share price is down 7% this month
Why the Nine Entertainment (ASX:NEC) share price is climbing on Monday
ASX 200 Weekly Wrap: COVID wobbles ASX as shares retreat

These were the worst performing ASX 200 shares last week

2 ASX 200 shares that keep growing their dividends

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 Bruce Jackson.

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
Trade The US Market With ZERO Brokerage* + FREE Access To Trading Ideas & Value Analysis Tools. Click Here!