Respected fund manager Wilson Asset Management (WAM) has recently identified two ASX shares that it owns in its portfolio.
WAM operates several listed investment companies (LICs). Some focus on larger companies like WAM Leaders Ltd (ASX: WLE) and WAM Research Limited (ASX: WAX).
There's also one called WAM Capital Limited (ASX: WAM) which targets "the most compelling undervalued growth opportunities in the Australian market."
The WAM Capital portfolio has delivered an investment return of 16.4% per annum since inception in August 1999, before fees, expenses and taxes. This gross return outperformed the S&P/ASX All Ordinaries Accumulation Index return of 8.4% per annum over the same timeframe.
These are the two ASX shares that WAM Capital outlined in its most recent monthly update:
Link Administration Holdings Ltd (ASX: LNK)
The fund manager explained that Link provides technology-enabled outsourced services for superannuation funds administration and corporation markets, including shareholder management, analytics and share registry services across 11 countries.
It has an underlying stakeholder base of approximately 10 million superannuation account holders and over 30 million individual shareholders globally.
WAM thinks there's good upside in its 44% stake in Property Exchange Australia Limited (PEXA), it's Australia's leading electronic property settlement provider.
The fund manager noted that it has previously announced its intention to maximise value for its shareholders by divesting its holding PEXA.
In the recent half year FY21 result, investors learned that PEXA transaction volumes grew 28% on the previous corresponding period and contributed $18.7 million to the ASX share's operating net profit after tax and amortisation. PEXA has a market share of over 75% in conveyancing in Australia.
The LIC's investment team believe that PEXA can expand its technology globally.
Airtasker Ltd (ASX: ART)
Airtasker isn't even 10 years old yet, but it listed on the ASX last month and has become Australia's leading online marketplace for local services with more than 4.3 million registered users according to WAM.
How it works is that the online marketplace connects customers who require a particular task to be completed with those willing to complete a task for payment. There have been approximately 950,000 customers having purchased services on the company's end to end e-commerce platform from inception to December 2020.
WAM pointed out that Airtasker reported that its unique paying customers had grown from approximately 18,000 in FY15 to approximately 367,000 in FY20, with the average task value increasing from $97 to $159 over that same timeframe.
Thanks to the initial public offering (IPO), the ASX share raised $83.7 million with shares issued at $0.65 per share.
Due to a high level of demand, where the IPO was oversubscribed by five times, the Airtasker share price increased significantly to $1.43 in the first week of trading. However, it has since fallen back to $1.28.
