Golden buying opportunity for 2 ASX shares slashed last month: Celeste

Here's a pair of businesses that are going pretty strong but whose stock prices are in a dip, ready now for those willing to buy in.

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Investors are pretty skittish at the moment with the economy teetering on the brink and inflation still raging.

So last month's reporting season saw ASX shares punished brutally even if the result slightly missed expectations — or even for just meeting analyst forecasts.

That means there could be some bargains out there for businesses that still have bright long-term prospects.

Here are two examples in Celeste Funds Management's portfolio:

Weak half-year result was just a matter of timing

Litigation funder Omni Bridgeway Ltd (ASX: OBL) watched in horror last month as its share price plunged 25% off a cliff.

In fact, the stock has fallen even further this month to bring the total losses since the start of February to a painful 35%.

Created with Highcharts 11.4.3Omni Bridgeway PriceZoom1M3M6MYTD1Y5Y10YALLwww.fool.com.au

The Celeste analysts, in a memo to clients, attributed this to "a weak result" and the retirement of its chief executive.

"Completions in the half were significantly lower than expected and operating costs were materially higher."

However, the Celeste team is not too worried about Omni Bridgeway's longer term prospects.

"With $304 million of commitments during the period, Omni Bridgeway [is] on track to achieve their FY23 target of $550 million," read the memo.

"We think the result and completions remain a timing issue."

Celeste's peers seem to agree that Omni Bridgeway stocks remain attractive.

According to CMC Markets, all three of the analysts covering the stock currently recommend it as a strong buy.

'Strong' pipeline of work coming up

Mining and infrastructure services contractor NRW Holdings Limited (ASX: NWH) also had to shut its eyes during February as its stock price tumbled.

"NRW Holdings fell 16.8% in February post a slightly softer than expected earnings result impacted by weather, delay of new contract awards and investment in North America."

Created with Highcharts 11.4.3Nrw PriceZoom1M3M6MYTD1Y5Y10YALLwww.fool.com.au

Cash conversion was weaker in the half yearly results, due to "projects' working capital releases and requirements".

The Celeste analysts, though, were optimistic upon affirmation of previous guidance for the full financial year.

"NRW Holdings reiterated FY23 guidance of $2.6 to $2.7 billion revenue and $162 to $172 million EBITA with normalising cash flow."

The company has plenty of work coming up, too.

"NRW's group pipeline is a strong $19.3 billion with orderbook up +$0.9 billion to $4.9 billion."

The professional community isn't quite as unanimous about NRW Holdings as Omni Bridgeway shares.

Current figures on CMC Markets show five out of eight analysts rating NRW shares as a buy.

Motley Fool contributor Tony Yoo has positions in Nrw. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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