I think the three ASX shares I'm going to write about in this article could deliver quick returns by the end of February 2020.
Investors like to talk about 'catalysts' that could cause a share price to rise in a fairly short amount of time.
Share markets are known to have delivered an average return per annum of 10% over the long-term. If you can identify a share that will deliver growth of more than 10% in a month then you could make a great annualised return.
Just remember, these are educated guesses. There is no certainty they'll come true by the end of next month:
Webjet Limited (ASX: WEB)
The rumour mill is heating up. There has been talk for a number of weeks that private equity is sniffing around the travel business. I don't blame them, Webjet is trading at only 16x FY21's estimated earnings.
There's likely to be a sense of urgency from each of the prospective bidders because there are several potential suitors, which could create a bidding war.
I'm no expert in takeovers, but I'd imagine that if a bid is to come in then it would need to be at least 10% higher than today's share price to get accepted by shareholders.
Even if no takeover offer does come in the underlying HY20 result alone could send the Webjet share price flying higher, as long as the Thomas Cook hit isn't too bad.
In the FY20 half-year result the company is expecting underlying earnings before interest, tax, depreciation and amortisation (EBITDA) of at least $80 million, which excludes one-off revenues & costs and the impact of AASB16. This would be growth of more than 37%.
For the full FY20 result underlying EBITDA is expected to grow organically by between 16% to 23% with total growth of 26% to 34%. Underlying EBITDA is expected to come in between $157 million to $167 million.
TPG Telecom Ltd (ASX: TPM) and Washington H. Soul Pattinson and Co. Ltd (ASX: SOL)
There are two ASX 100 (ASX: XTO) businesses that are waiting for a court decision due by February. The decision will decide whether to allow TPG to merge with Vodafone Australia. A decision by the judge could change the market capitalisations of both companies by hundreds of millions of dollars.
If TPG is successful it will gain excellent synergies with Vodafone Australia, plus it will mean only one 5G network will need to be created rather than two. The proposal was initially blocked by the ACCC, but there is a feeling among investors that the appeal could be successful. There will still be two other large competitors plus all of the smaller ones.
Why does this affect Soul Patts? Well, the investment conglomerate owns just over a quarter of TPG, so its current stake is worth over $1.6 billion at face value. Soul Patts will be impacted by the amount that the market reacts to TPG's court decision, plus it will benefit from the combined telco's growth and dividends over the longer-term assuming Soul Patts stays invested.
How much could TPG rise? Well, that's anyone's guess. The share price rose to around $8.60 on the merger news, which was before the recent rate cuts. Perhaps a 20% rise is possible, but the NBN has affected some of TPG's earnings, so it may not reach the same heights.
Either way, I think a positive decision could give a very quick boost to TPG's share price.
Foolish takeaway
The TPG decision is more of a flip of the coin. The judge will need to find some compelling reasons to overturn the ACCC's original decision.
However, I think the current Webjet share price is a probably win-win for the next couple of years, either a potential takeover offer may come in or it simply looks cheap based on the projected growth and will hopefully naturally rise, so it would be my pick of the two situations.
