Australians sure are feeling the crunch now as inflation and rising interest rates hit home, with many ASX investors rattled by the stock market volatility of FY23.
But history shows that global stock markets typically can weather times of economic turbulence and emerge from the lows to rise again — and the ASX is no exception.
With day one of a fresh new financial year upon us, now might be a good time to review our portfolios and hit the refresh button.
We asked our Foolish contributors to turn over a new leaf and share their thoughts on some top ASX shares they reckon will help boost our stock portfolios — and our spirits — in July.
Here is what the team has come up with…
6 best ASX shares for July 2023 (smallest to largest)
- Universal Store Holdings Ltd (ASX: UNI), $228.63 million
- VanEck Morningstar Wide Moat ETF (ASX: MOAT), $591.85 million
- Clinuvel Pharmaceuticals Limited (ASX: CUV), $883.46 million
- Johns Lyng Group Ltd (ASX: JLG), $1.40 billion
- Lovisa Holdings Ltd (ASX: LOV), $2.08 billion
- CSL Ltd (ASX: CSL), $133.80 billion
(Market capitalisations as of market close 30 June 2023).
Why our Foolish writers love these ASX stocks
Universal Store Holdings Ltd
What it does: It's a specialty retailer of casual clothing, footwear, and accessories for young and groovy people. Its brands include Champion and Tommy Jeans.
By Bronwyn Allen: This ASX retail share has tumbled 36% in two months to just under $3, largely due to its May trading update.
The company expects record sales for FY23 but a "subdued environment" into FY24 because consumers are cutting spending. This is the time for retail shares investors to grit their teeth and buy the dips for long-term benefits, including higher dividend yields, once this inflation drama is over.
Broker Goldman Sachs has a buy rating and predicts a 70% share price gain over the next 12 months (price target $5.05).
It's also notable that several company directors are buying the dip, with one ploughing an extra $1 million into the stock this month.
Motley Fool contributor Bronwyn Allen does not own shares in Universal Store Holdings Ltd.
VanEck Morningstar Wide Moat ETF
What it does: The VanEck Wide Moat ETF is an exchange-traded fund (ETF) that focuses on high-quality United States-based shares.
By Sebastian Bowen: The VanEck Wide Moat ETF is unlike any other ETF on the ASX. It invests in a concentrated basket of US shares that all share the characteristic of a moat or intrinsic competitive advantage. This could include a strong brand, cost advantage over competitors, or providing a good or service that customers find difficult to live without.
When it comes to performance, this ETF just keeps on giving. This week saw MOAT units hit a new 52-week high, and investors have enjoyed a monstrous return of almost 25% over 2023 to date.
For a high-quality ETF that gives ASX investors exposure to some of the world's best shares, as well as a proven track record of high performance, I think the VanEck Wide Moat ETF is well worth a look this July.
Motley Fool contributor Sebastian Bowen owns VanEck Morningstar Wide Moat ETF units.
Clinuvel Pharmaceuticals Limited
What it does: Pioneers in photomedicine, Clinuvel develops and commercialises treatments for unmet healthcare needs. Currently, the company's wheelhouse centres around photoprotection, DNA repair, and repigmentation. Its clinical program includes evaluating non-light-based conditions such as Arterial Ischaemic Stroke (AIS).
By Mitchell Lawler: Clinuvel has demonstrated its ability to successfully bring a drug to market, establishing its Scenesse medication in Australia, the US, Europe, and Israel.
Being the world's first systemic photoprotective drug and the only FDA-approved treatment of a rare skin condition known as erythropoietic protoporphyria (EPP), Clinuvel's Scenesse success is an example of what the team is capable of.
What I find most appealing about Clinuvel is its potential to tap into the cosmetics industry. The company can potentially address specialty applications, such as Vitiligo (patchy skin colour loss), and more general uses, such as sun-free bronzing products.
The only detractor is the rise in competition for EPP treatment. Shareholders may want to keep an eye on Mitsubishi Tanabe's progress with MT-7117.
Motley Fool contributor Mitchell Lawler does not own shares of Clinuvel Pharmaceuticals Limited.
Johns Lyng Group Ltd
What it does: The company is an "integrated building services business that delivers building and restoration services across Australia and the US". Its main offering is about rebuilding and restoring properties and contents after 'insured events', including natural disasters.
By Tristan Harrison: Johns Lyng is exposed to the unfortunate tailwind of benefiting from more frequent storms and other weather events that are damaging and costly.
The ASX share's earnings continue to grow at a strong rate. It recently increased its revenue and earnings before interest, tax, depreciation and amortisation (EBITDA) guidance for FY23. Remember, it's usually a great sign when companies increase their already-promising guidance. FY23 total normalised EBITDA is expected to rise by 56% compared to FY22.
The company is growing in numerous ways, with both its core business and additional services, such as the Johns Lyng strata services segment.
The 20% drop in the Johns Lyng share price since 5 June makes this an opportunistic time to invest.
Motley Fool contributor Tristan Harrison does not own shares of Johns Lyng Group Ltd.
Lovisa Holdings Ltd
What it does: Lovisa Holdings is a fast fashion jewellery retailer operating across a growing number of international markets. At the last count, it had a total of 715 stores. This includes 163 in Australia and 155 in the United States.
By James Mickleboro: I think that Lovisa could be a top option for investors in July. While the retail sector is going to be a tough place to operate in the near term due to cost of living pressures, I believe that Lovisa is better positioned than most to navigate the crisis.
This is due to its low price point and younger target demographic. The latter are less exposed to rising interest rates and are expected to continue spending through the cycle.
In addition, the company continues to expand its store footprint globally, which I believe will be supportive of growth in the coming years.
Motley Fool contributor James Mickleboro does not own Lovisa Holdings Ltd shares.
CSL Ltd
What it does: Established more than 100 years ago, CSL is a biotechnology company that develops and delivers biotherapies and vaccines. CSL's plasma business operates one of the largest plasma collection networks in the world.
By Bernd Struben: I think the past month's retrace in the CSL share price presents a good buying opportunity.
Although it came in below optimistic consensus expectations – hence the share price retrace – CSL offered some healthy profit guidance on 14 June. The company forecasts a 13% to 18% year-on-year increase in net profits after tax and amortisation (NPATA) for FY24 of US$2.9 billion to US$3.0 billion (on a constant currency basis).
Leading brokers also expect big things from the CSL share price, which closed on Friday trading for $277.38.
Following the 14 June guidance update, Citi retained its buy rating, with a price target of $340.00, Macquarie maintained its outperform rating with a $326 price target, and Morgans held its add rating and a $323 price target.
And if it's passive income you're after, CSL shares trade on a trailing dividend yield of 1.0%.
Motley Fool contributor Bernd Struben does not own shares in CSL Ltd.
