A recent sell-off makes some ASX shares look like great buys at the current prices. There is a lot of uncertainty surrounding technology and AI valuations at the moment.
But, when it comes to some of the ASX’s most appealing investments, I think this could make them strong buys right now.
Xero Ltd (ASX: XRO)
Xero has been one of the leading lights on the ASX over the past decade, building a global subscriber base of millions with its accounting software.
Despite its impressive user and financial growth, the Xero share price has fallen more than 50% in the past month. That’s despite business reporting a big double-digit jump in the last result for its operating revenue, net profit and cashflow.
I don’t think it’s likely that AI will replace every existing software business. It’s more likely, to me, that AI will be integrated within existing platform offerings, including Xero’s.
Xero continues to win new subscribers, and I don’t think its subscription cost is substantial for users considering the great value that users get out of it, particularly with the time-saving tools, the reports and the reporting tools that link with tax authorities.
The main things to focus on are its 99% subscriber retention rate, its pace of new subscribers and its rising earnings – all of which are still very positive, so this makes the ASX share seem like a great buy to me.
VanEck Morningstar International Wide Moat ETF (ASX: GOAT)
The world is a rapidly-changing place these days and some industries/businesses may be exposed to disruption.
The ones that may be able to succeed are businesses with economic moats that are capable of continuing to stand against competition.
The GOAT ETF is an exchange-traded fund (ETF) that is invested in a portfolio of global stocks that are seen as having economic moats that are expected to endure for at least 20 years, making this an appealing investment to own for the long-term.
Added to that, the GOAT ETF only invests in these appealing businesses when they are trading at a valuation that’s compelling to analysts from Morningstar.
The portfolio is made up of companies from a number of countries and sectors, though there’s no set percentages that there needs to be in the portfolio. This diversification helps reduce risks without necessarily reducing the potential returns.
Over the last five years the GOAT ETF has returned an average of more than 11% per year.
