There are some really impressive ASX shares to consider in September 2021.
As COVID-19 impacts lift around the world, some companies may be opportunities that are waiting to be pounced on.
Companies that have been impacted by COVID-19 could be the ones to see larger growth of profits over the next 12 months compared to ones that have already seen strong levels of demand.
These two ASX shares could be good longer-term ideas:
Lovisa Holdings Ltd (ASX: LOV)
Lovisa aims to provide very affordable jewellery to a younger demographic of customers.
How does the business ensure it has in-demand products? It says:
Our trend spotting departments worldwide take inspiration from couture runways and current street style to deliver new, must-have styles to our customers.
We are a fashion-forward jewellery brand that caters to every woman, with 150 new styles being delivered to stores each week.
Lovisa is currently rated as a buy by the broker Morgans with a price target of $22.24.
The recent FY21 result was better than the broker was expecting. COVID-19 impacts were apparent on the report after restrictions in the northern hemisphere.
However, the ASX share was able to generate substantially more profit in FY21. Pre AASB 16, net profit after tax grew by 43.3% to $27.7 million. Revenue increased 18.9% to $288 million, earnings before interest, tax, depreciation and amortisation (EBITDA) climbed 34.6% to $60.2 million and earnings before interest and tax (EBIT) rose 39.4% to $42.7 million.
Lovisa has more growth potentially planned for FY22 after it added 109 net new stores during FY22, ending with 544 at the end of the 2021 financial year. This growth was driven by the addition of 87 stores in Europe as part of the Beeline acquisition.
In the first eight weeks of FY22, total sales were up 56% on the same period of FY21.
Morgans thinks the Lovisa share price is valued at 35x FY23's estimated earnings.
Premier Investments Limited (ASX: PMV)
Premier Investments is responsible for a number of different retail brands including Smiggle, Peter Alexander, Just Jeans, Jay Jays and so on.
The company has told investors that it's expecting to report a strong result in FY21. Premier retail's EBIT for the 53 weeks ending 31 July 2021 is expected to be in the range of between $340 million to $360 million, pre-AASB 16. That would be growth of between 82% to 92% on FY20.
The ASX share said that there were a few different drivers for the business.
There was strong demand for the winter product ranges across all brands. Premier also noted there was strong sales growth and a highly profitable online performance. There was an exceptional strong gross profit margin expansion in the second half with an increase of over 380 basis points on the second half of FY20.
Premier Investments also said there was a strong cost control culture including continuing to reach agreements with landlords that appropriately rebase the company's rent expense.
According to Commsec, the Premier Investments share price is valued at 22x FY22's estimated earnings. It has a projected FY22 grossed-up dividend yield of 4.4%.
