What ASX Stocks To Buy?

In our search for high-quality, safe companies to buy and hold, a few still stand out.

As I scroll through the list of 50 stocks, on the Parris’s TOP 50 excel spreadsheet, Beach Energy (ASX.BPT) continues to trade undervalued.

It is currently trading 40% below our Earnings Power Value (EPV), offering a juicy 16.9% earnings yield but a low dividend yield of 1.31%.

Beach Energy (BE) operates primarily in one business, namely the exploration, development and production of hydrocarbons.

Revenue is derived from the sale of gas and liquid hydrocarbons. Gas sales contracts are spread across major Australian and New Zealand energy retailers and industrial users with liquid hydrocarbon product sales being made to major multi-national energy companies based on international market pricing.

Gas revenues provide stability and certainty of funding for near term operating costs and capital expenditure, insulating from oil price volatility.

What is going to be the catalyst that’ll send the share price soaring?

I believe there is still value in Adairs (ASX.ADH).

Having risen over 394% from its bottom of 95.4 cents per share, it is still offering a 5.3% earnings yield but a high dividend yield of 6.22%.

Adairs is a specialty retailer of home furnishings in Australia and New Zealand with a national footprint of stores across a number of store formats with an online store.

Adairs is principally engaged in the manchester and homewares retail market segments within Australia and New Zealand. Online sales accounted for 17 per cent of total company sales and grew by 41 per cent in FY2019.

Management released a mid-June trading report, with Mark Ronan, Managing Director and CEO, saying:

“Since Adairs stores reopened we have seen strong sales across both the store network and online channel as customers return for the instore service and experience they expect from Adairs. Pleasingly, Mocka’s sales growth has also continued at high levels. Both businesses have also remained disciplined on inventory and margin management.

Disclosure: I own shares in the stocks mentioned above. 

Disclaimer: This article represents the opinions of Mr. Parris. Mr. Parris is not a licensed investment advisor. Mr. Parris may hold ...

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