Got $2,000? These 2 ASX shares could be bargain buys for 2023 and beyond

I'm backing these two picks to deliver good growth over the long term.

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Key points

  • Wesfarmers’ Bunnings and Kmart businesses could outperform in the current environment
  • The Vaneck Morningstar Wide Moat ETF has built a portfolio focused on US companies with strong competitive advantages at a good price
  • I believe both of these ASX shares can perform strongly in the years to come

The ASX share market is a great place to find long-term opportunities. I think the two ASX shares I'm going to write about in this article can do really well from their current prices for the long term.

Interest rates and inflation are causing a lot of volatility in the stock market. But, as Warren Buffett once said about investing during market uncertainty:

Be fearful when others are greedy, and greedy when others are fearful.

There could be some really good opportunities right now like the below ideas which could do well for years to come. I'd buy them with $2,000.

Wesfarmers Ltd (ASX: WES)

Wesfarmers is one of my favourite businesses on the ASX – it operates a number of retailers like Bunnings, Kmart, Officeworks and Target.

In an economic environment where households have less spare money, the value-focused offers of Bunnings and Kmart could do much better than competitors.

I like the diversified nature of the company. The ASX share has a growing portfolio of non-retail brands, thanks to its healthcare, industrial and chemicals, energy and fertiliser (WesCEF) divisions.

Created with Highcharts 11.4.3Wesfarmers PriceZoom1M3M6MYTD1Y5Y10YALL1 Apr 20232 Jun 2023Zoom ▾3 Apr10 Apr17 Apr24 Apr1 May8 May15 May22 May29 May10 Apr10 Apr24 Apr24 Apr8 May8 May22 May22 Maywww.fool.com.au

As we can see on the chart above, the Wesfarmers share price is down around 9% from 26 April 2023, making it much cheaper. It's possible there could be further declines, but I think the total shareholder returns over the next five years (share price and dividend growth) can be solid, particularly once a fully-operational Mt Holland starts generating earnings.

Source: TradingView, Wesfarmers price/earnings ratio

As we can see on the chart above, Wesfarmers' current price/earnings (P/E) ratio is close to the lowest it has been since the COVID-19 crash.

Vaneck Morningstar Wide Moat ETF (ASX: MOAT)

This is a high-performing exchange-traded fund (ETF), though past performance is not a reliable indicator of future returns.

VanEck says that this index is a rules-based index that's invested in at least 40 "attractively priced US wide-moat stocks, as determined by Morningstar's time-tested proprietary research."

An economic moat refers to the competitive advantages of a business. Morningstar says that the "durability of economic profits is far more important than magnitude." For a company to be involved in the portfolio, it must have at least one of five moat sources: intangible assets, cost advantages, switching costs, network effects and efficient scale.

The economic moat is expected by Morningstar to endure for more than a decade.

As we can see on the chart below, the ASX share has delivered a lot of capital growth over the past five years. I think the investment style is very effective for the portfolio and that it could do well in the long term.

Created with Highcharts 11.4.3VanEck Morningstar Wide Moat ETF PriceZoom1M3M6MYTD1Y5Y10YALL1 Jun 20182 Jun 2023Zoom ▾Jul '18Jan '19Jul '19Jan '20Jul '20Jan '21Jul '21Jan '22Jul '22Jan '232019201920202020202120212022202220232023www.fool.com.au

Motley Fool contributor Tristan Harrison has no position in any of the stocks mentioned. 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 positions in and has recommended Wesfarmers. The Motley Fool Australia has recommended VanEck Morningstar Wide Moat ETF. 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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