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2 cheap ASX shares I’d buy next week

The two ASX shares in this article could be cheap and have the potential to generate good returns over the next few years.

Cheap doesn’t always mean good. But I do think that the below two investments could be solid ideas.

Adairs Ltd (ASX: ADH)

ASX retail shares are typically priced at a lower earnings multiple compared to other industries.

The Adairs share price has fallen around 30% since the start of the year.

According to Commsec, the Adairs share price is valued at 7 times FY24’s estimated earnings with a projected FY24 dividend yield of 15%, including the franking credits.

I think there’s plenty to like about Adairs. The company says there is a link between the total floor space and sales. So it’s planning to open more stores.

The ASX share also says it’s upsizing some of its stores because bigger stores are a lot more profitable. One benefit is being able to display more of its products.

It’s doing the right things to connect with customers. It’s growing its membership program while also ensuring a quality e-commerce experience.

The company is also working on becoming more efficient with a new national distribution centre which allows it to manage inventory better, fulfil orders quicker and also lower costs.

I think that this cheap ASX share has a compelling future.

VanEck Morningstar Wide Moat ETF (ASX: MOAT)

This exchange-traded fund (ETF) may not initially strike investors as a cheap option.

But remember, cheap doesn’t just mean a low price/earnings ratio. It can simply mean that an investment is cheaper than what investors think it’s worth.

For a business to make it into the portfolio, it has to be at an attractive value compared to Morningstar’s estimate of fair value.

Some of its top holdings include Compass Minerals, Merch & Co, Constellation Brands, Philip Morris, Western Union, Kellogg, Campbell Soup, Medtronic, Zimmer Biomet, Emerson Electric, Polaris and Amazon.

But there is another factor regarding the MOAT ETF. Analysts have made a judgement that each of these businesses have economic moats, also known as competitive advantages, that are expected to endure for at least the next decade and perhaps longer.

The net returns have been good. Since inception, the MOAT ETF has delivered an average return per year of 19.2%. That’s after the management fees of 0.49% per year.

$50,000 per year in passive income from shares? Yes, please!

With interest rates UP, now could be one of the best times to start earning passive income from a portfolio. Imagine earning 4%, 5% — or more — in dividend passive income from the best shares, LICs, or ETFs… it’s like magic.

So how do the best investors do it?

Chief Investment Officer Owen Rask has just released his brand new passive income report. Owen has outlined 10 of his favourite ETFs and shares to watch, his rules for passive income investing, why he would buy ETFs before LICs and more.

You can INSTANTLY access Owen’s report — or get it emailed to you — for FREE by CLICKING HERE NOW or the button below.

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Information warning: The information on this website is published by The Rask Group Pty Ltd (ABN: 36 622 810 995) is limited to factual information or (at most) general financial advice only. That means, the information and advice does not take into account your objectives, financial situation or needs. It is not specific to you, your needs, goals or objectives. Because of that, you should consider if the advice is appropriate to you and your needs, before acting on the information. If you don’t know what your needs are, you should consult a trusted and licensed financial adviser who can provide you with personal financial product advice. In addition, you should obtain and read the product disclosure statement (PDS) before making a decision to acquire a financial product. Please read our Terms and Conditions and Financial Services Guide before using this website. The Rask Group Pty Ltd is a Corporate Authorised Representative (#1280930) of AFSL #383169.

At the time of publishing, Jaz does not have a financial or commercial interest in any of the companies mentioned.
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