Lots of ASX shares are seeing declines of share prices this year. But certain stocks are being beaten up more than others. Experts think that some of these top ASX shares are opportunities.
These are businesses that have long-term growth aims and now the share prices are better value according to leading brokers:
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Temple & Webster Group Ltd (ASX: TPW)
Temple & Webster is currently rated as a buy by a few brokers, including Credit Suisse with a price target of $13.54. That's a potential upside of almost 90%. The Temple & Webster share price has fallen by 33% since the start of the year.
This business likes to describe itself as Australia's leading pure-play retailer for furniture and homewares.
The ASX share's growth is capturing a lot of analyst investor attention. In the first half of FY22, it managed to generate $235.4 million of revenue – this was growth of 46% year on year and 218% over a two-year period.
Temple & Webster managed to achieve the sixth straight quarter of revenue per active customer growth. This is helping increase the value of each customer to the ASX share. The number of active customers jumped 34% to 906,000.
The business is focused on growing beyond its core categories. Trade and commercial revenue was up 49% in the period, representing 7% of the total revenue. Home improvement (think paint, plumbing and so on) revenue was up 95%, representing 4% of total revenue. Management said that the company is well placed to be a leading player in both markets.
It's continuing to invest for growth with technology, data, the customer experience and so on. Trading in the FY22 second half to 6 February 2022 showed revenue growth of 26% year on year.
Baby Bunting Group Ltd (ASX: BBN)
The Baby Bunting share price is another that has fallen. Since the start of the year, it has fallen around 14%.
But it's rated as a buy by at least five brokers including Morgans. The broker's price target is $6, which is more than 20% higher than where it is today.
Morgans was impressed by a number of metrics that the ASX share recently reported. The broker also thinks that Baby Bunting will be able to grow more with a wider range of products and increase its position in the market.
Baby Bunting reported that first half total sales grew by 10% to $239.1 million with comparable store sales growth of 6.8%. Online sales were 23.8% of sales, up from 19.7% of sales last year. Online sales grew by 32.6% to $56.8 million.
Private label and exclusive product sales grew by 25.3% to be 44.5% of total sales. Increasing this helps margins. The long-term target is 50%.
The company grew underlying net profit after tax (NPAT) by 16.4% and the interim dividend was increased by 13.8% to 6.6 cents per share.
Based on Morgans' numbers, the Baby Bunting share price is valued at 21x FY22's estimated earnings and 17x FY23's estimated earnings.
