The ASX share market is going through a lot of volatility right now. But I think there are plenty of ASX share opportunities.
One question to consider is – would you rather invest when prices are higher or lower?
Here’s another question – when we look at the past, does every previous decline now seem like an opportunity?
I know my own answer to those questions.
It’s true that rising interest rates have a unique impact on asset values, likely negative. But the lower prices are reflecting the changing investment environment. I’d happily buy these two ASX shares for the long-term:
City Chic Collective Ltd (ASX: CCX)
The City Chic share price has dropped by 55% over the last six months.
The global apparel retailer is seeing ongoing revenue growth. It just gave a trading update which showed that revenue was up 25.4% in the second half of FY22 to date.
Looking at the breakdown of that revenue, online sales were up 22.7% to $77.8 million, store sales were down 8% to $19.8 million, marketplace revenue was up 342.8% to $8.6 million and wholesale revenue was up 2,415.4% to $3 million.
I think the above numbers, particularly online, show how well the company has adapted to the retail environment in the 2020s.
Despite the decline of store revenue, City Chic achieved revenue growth in each region in the second half to date, ANZ revenue was up 3% to $48.3 million, Americas revenue was up 47.2% to $47.5 million and EMEA (Europe, Middle East and Africa) revenue rose 68.9% to $13.4 million.
Second half EBITDA is expected to be higher than the first half.
It’s benefiting from the fact that the plus-size market is forecast to grow by around 7% annually, with the average annual spend in this category less than the rest of the women’s apparel market.
The ASX share has started a number of new marketplace partnerships in FY22, including with David Jones, Walmart, Target, eBay and Amazon.
It’s planning to increase prices in some retail categories.
Airtasker Ltd (ASX: ART)
Over the last six months, the Airtasker share price has plunged 52%.
I think the business model of Airtasker’s online marketplace where local service tasks can be posted is very compelling. It has a huge potential market in Australia, the US and the UK. The digital nature of the service means that Airtasker can generate very high profit margins.
The ASX share continues to grow at a solid double digit pace. In the three months to 31 March 2022, revenue rose 21.2% year on year to $8.6 million. It managed to generate $1 million of positive operating cashflow. I think this shows that the business can invest heavily for growth while not burning through its cash.
As I’ve already mentioned, the company has big plans for overseas growth. UK gross marketplace volume (GMV) rose 138% year on year in the third quarter, while the US posted task growth was 90% quarter on quarter.
In the US it’s growing quickly in places like Miami, Kansas City, Dallas and Atlanta. I think this bodes well for the rest of the country.
But it’s not done with its expansion. It’s growing into new segments of the local services economy in Australia, while replicating the growth of Australia in the US and UK.
Final thoughts on these ASX shares
I think both of them have very long growth runways. The fact they’re both looking at the large markets of the US and UK is very promising if they can keep gaining market share.
I’d be happy to buy both of them right now for the next decade.
