I love taking advantage of lower priced ASX shares when they’re there as opportunities. I’m going to write about two I like the look of.
Beaten-up prices are only there for so long if the business is going to go through a recovery. The market will often guess, and send prices higher before the fundamentals are revealed.
With that in mind, these are the ASX shares that have gone lower but look like opportunities to me.
Temple & Webster Group Ltd (ASX: TPW)
Temple & Webster says it’s the leading online retailer of furniture and homewares in Australia. A lot of products sold on the website are from third party suppliers, reducing inventory and capital requirements for the company. But, it also has a growing private label segment of products, which come with higher profit margins.
The Temple & Webster share price is down 40% since 2 February 2023. I don’t believe the business has changed that much since January, even if it showed that demand has slowed compared to the boom times of COVID. It’s no surprise that online shopping isn’t as in demand with lockdowns over.
But, I think the company has plenty of long-term potential because of the long-term adoption of e-commerce, the company’s growing scale benefits and its expectations of stronger margins. I also like that the company is investing in expansion in other areas, such as home improvement and commercial customers.
By 2030, I think this business could be one of the larger retailers on the ASX.
Gentrack Group Ltd (ASX: GTK)
Gentrack is one of the promising ASX tech shares, in my opinion. It offers software for airports and utility companies around the world.
Some of its customers include Melbourne Airport, Gatwick Airport (one of the UK’s biggest airports), Sydney Airport and Auckland International Airport Limited (ASX: AIA).
After all of the disruption of COVID-19, the business is expecting strong revenue and profit growth.
Since 3 March 2023, the Gentrack share price has dropped by around 10%, making it much better value.
As the ASX tech share invests for growth, wins new customers and expands with current customers, I think the company can keep growing its share price from here. Software businesses can achieve very attractive margins, so revenue growth could help the bottom line significantly.
