The best performing fund managers took two specific actions in February and March of this year. Towards the end of February, if they were paying attention, they were selling down low liquidity small cap ASX shares. After the COVID-19 market rout on 23 March, they started to pounce on mispricing opportunities. Here are 5 great ASX shares that major fund managers have made a lot of money on this year.
Fisher & Paykel Healthcare Corp Ltd (ASX: FPH)
This company is held by listed companies (LIC) WAM Capital Limited (ASX: WAM), and Australian Foundation Investment Co.Ltd (ASX: AFI). Fisher and Paykel is up by 46.21% in year to date trading. This ASX share saw revenues increase dramatically due to the ventilator demand from March to combat the coronavirus. Currently, the company is building additional manufacturing capabilities to continue to support COVID-19 requirements.
Temple & Webster Group Ltd (ASX: TPW)
Held by WAM Capital, this company has seen its share price rise by 356.44% in year to date trading. Temple & Webster has benefited greatly by the rapid move to online shopping as everyone went into lockdown. Moreover, consumers have redirected disposable income to home spending. Consequently, I think this ASX share remains a good opportunity for the foreseeable future as people continue to shop online.
Brickworks Limited (ASX: BKW)
ASX share Brickworks is held by the LICs WAM Capital and Milton Corporation Limited (ASX: MLT). Despite fierce pressure on revenue in the United States and Australia, this company has managed to increase its share price by 5.2% in year to date trading. At this price it also pays a trailing 12-month dividend yield of 3.03%. Moreover, I think that Australia’s leading brick maker is likely to benefit from reducing the constraints imposed by responsible lending laws over the remainder of FY21.
Eagers Automotive Ltd (ASX: APE)
The same two LICs also have sizable investments in Eagers Automotive, the car sales company. Despite the lockdown, the ASX share price for this company is down by more than 6% in year to date trading. However, it has raised from the market low point, on 23 March, by 204.26%. This shows the strength of looking for mispricing opportunities in the market. Every time the market rises or falls in unison, there are opportunities to make profits. Moreover, Eagers is also likely to benefit from any loosening of responsible lending laws.
Bapcor Ltd (ASX: BAP)
In keeping with the automotive theme, Bapcor has also seen its share price rise by 7.37% in year to date trading despite the pandemic lockdown. Held by WAM Capital, Bapcor has already started to see revenues rise as people become more mobile. Bapcor is likely to see further gains as borders open more and people start spending more time on national holidays. I think this ASX share is set to see additional growth over the next few months. At a current price to earnings (P/E) ratio of 25.51, I believe it is well-priced for future growth.
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Daryl Mather has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. owns shares of Temple & Webster Group Ltd. The Motley Fool Australia owns shares of and has recommended Bapcor and Brickworks. The Motley Fool Australia has recommended Temple & Webster Group Ltd. 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 Scott Phillips.
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