WAM Active Limited (ASX: WAA) is one of the listed investment companies (LICs) in the Wilson Asset Management (WAM) stable that targets ASX shares.
It runs a number of different LICs that target different investments. There's the largest – WAM Capital Limited (ASX: WAM) – which targets undervalued ASX shares. Then there's WAM Leaders Ltd (ASX: WLE) which looks to buy undervalued ASX blue chips.
Since inception in January 2008, WAM Active's portfolio has delivered a gross return of 12.1% per annum before fees, expenses and taxes.
Its hunting ground target is market mispricing opportunities on the Australian stock exchange.
In its latest monthly update, WAM Active outlined these two ASX shares as opportunities:
Image source: Getty Images
Reliance Worldwide Corporation Ltd (ASX: RWC)
WAM explained that the Reliance Worldwide designs, manufactures and supplies water flow and control solutions and products for the plumbing industry, with a focus on repair and renovation.
The company operates in the Asia Pacific region, the Americas, Europe, the Middle East and Africa.
WAM Active pointed out that in the FY21 half-year result, the ASX share generated a 13% rise in net sales to $642.4 million. The company also reported a $168.7 million reduction in net debt to $226 million.
Operating cashflow went up by 17% to $155.6 million and adjusted net profit after tax increased by 56% to $99.3 million. It grew the interim dividend by 33% to 6 cents per share.
The fund manager acknowledged that the business faced headwinds over the past few years, but it sees a positive outlook in the home renovation and repair markets which can drive the company in its key markets in the US and the UK.
Airtasker Ltd (ASX: ART)
Airtasker is an ASX share that recently listed on the ASX. It's now the leading online marketplace for local services with more than 4.3 million users.
How does it work? That online marketplace connects customers who require a particular task to be completed with people willing to complete a task for money. Around 950,000 customers have purchased a service on the e-commerce platform since inception in December 2020.
The ASX share reported that its 'unique paying customers' have grown from around 18,000 in FY15 to approximately 367,000 in FY20. Over that same time period, the average task value went from $97 to $159.
Airtasker managed to raise $83.7 million from investors during its initial public offering (IPO) process at a share price of $0.65. Since then, the Airtasker share price has more than doubled to $1.36 per share. That's a strong debut for the ASX share.
