Why I would buy these cheap ASX shares today

With the S&P/ASX 200 (Index: ^AXJO) (ASX: XJO) trading on a price-to-earnings of approximately 16.2x, finding value in the market is becoming harder and harder.

But if you look close enough you will find that there are still a few potential bargain buys out there.

Two which I think investors ought to consider today are listed below. Here’s why I like them:

Accent Group Ltd (ASX: AX1)

The shares of this footwear retailer, formerly known as RCG Corporation, are currently changing hands at a lowly 12x trailing earnings. Although Accent’s bottom line growth is expected to slow in FY 2018, management does still expect another year of profit growth.

Which at this multiple arguably makes its shares dirt cheap in my opinion. Especially given that they provide investors with a trailing 6.6% dividend at the current share price. One thing that I do like about Accent is the strength of its licensed brands. This should offer the company some protection from the arrival of Amazon in Australia.

Collins Foods Ltd (ASX: CKF)

This KFC operator’s shares have been on a bit of a slide in recent months following a weaker-than-expected half-year result. But considering the strong growth potential the company has from its expansion into an underpenetrated European market, I think investors ought to overlook this minor blip and focus on the bigger picture.

Although its shares don’t necessarily look that cheap on paper at 18x trailing earnings, if you adjust for one-offs from its first-half result then its shares are priced at under 15x earnings. I think at this price it becomes an attractive buy and hold investment option and a far cheaper alternative to industry peer Domino’s Pizza Enterprises Ltd (ASX: DMP).

Lastly, here are three more top shares which are great value given their strong growth potential.

Top 3 ASX Blue Chips To Buy In 2018

For many, blue chip stocks mean stability, profitability and regular dividends, often fully franked..

But knowing which blue chips to buy, and when, can be fraught with danger.

The Motley Fool’s in-house analyst team has poured over thousands of hours worth of proprietary research to bring you the names of "The Motley Fool’s Top 3 Blue Chip Stocks for 2018."

Each one pays a fully franked dividend. Each one has not only grown its profits, but has also grown its dividend. One increased it by a whopping 33%, while another trades on a grossed up (fully franked) dividend yield of almost 7%.

The names of these Top 3 ASX Blue Chips are included in this specially prepared free report. But you will have to hurry. Depending on demand – and how quickly the share prices of these companies moves – we may be forced to remove this report.

Click here to claim your free report.

Motley Fool contributor James Mickleboro owns shares of Collins Foods Limited. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

Two New Stock Picks Every Month!

Not to alarm you, but you’re about to miss a very important event! Chief Investment Advisor Scott Phillips and his team at Motley Fool Share Advisor are about to reveal their latest official stock recommendation. The premium “buy alert” will be unveiled to members and you can be among the first to act on the tip.

Don’t let this opportunity pass you by – this is your chance to get in early!

Simply enter your email now to find out how you can get instant access.

By clicking this button, you agree to our Terms of Service and Privacy Policy. We will use your email address only to keep you informed about updates to our website and about other products and services we think might interest you. You can unsubscribe from Take Stock at anytime. Please refer to our Financial Services Guide (FSG) for more information.