On Tuesday the S&P/ASX 200 index started the week with a day deep in the red. The benchmark index finished the day 1.35% lower at 6,994.5 points after coronavirus concerns sent global markets into selloff mode.
A few shares that were sold off and could now be in the bargain bin are listed below. Here's why I would consider them when the dust settles:
Jumbo Interactive Ltd (ASX: JIN)
The Jumbo share price tumbled almost 5% lower to $14.11 on Tuesday. This latest decline means that the lottery ticket seller's shares have now fallen almost 50% since peaking at $27.92 in October. The catalyst for this decline has been its slowdown in profit growth during the first half of FY 2020 due to its investment in growth opportunities. I believe this selloff has been overdone and has left its shares trading at an attractive level. At 28x estimated full year earnings, I think its shares are good value considering its strong long term growth potential.
Qantas Airways Limited (ASX: QAN)
The Qantas share price dropped 5% to $6.36 yesterday. Concerns over the impact that the coronavirus could have on global tourism has been weighing on Qantas and other travel shares. I think the selling has been a bit of an overreaction and see a lot of value in its shares at the current level. Especially in this low interest rate environment. Qantas' shares now provide investors with a trailing fully franked ~4% dividend yield.
Webjet Limited (ASX: WEB)
The Webjet share price crashed 14% lower to $12.37 on Tuesday. Whilst coronavirus concerns also weighed on Webjet's shares, a broker downgrade appears to have done the most damage. According to a note out of Morgan Stanley, it has downgraded Webjet's shares to an underweight rating and slashed the price target on them by almost 20% to $10.00. Morgan Stanley made the move on the belief that Google Travel is negatively impacting its B2C business. Whilst I think Morgan Stanley makes some fair points, I'm more bullish on Webjet's B2B business and expect this to be the key driver of growth in the future. In light of this, I see the selloff as a buying opportunity for investors.
