Fundies reveal their 2 top ASX shares for 2022

Fundies pick these two companies as their number one picks for 2022…

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As the end of 2021 draws closer, fund managers are already sharpening their pencils and running the numbers on which ASX shares could make a bucketload for investors in the year ahead.

Two small-cap companies have made their way into the top picks of two distinguished brokers. Here’s a look at why these shares are a buy in 2022 according to the experts.

These ASX shares make fundies’ 2022 wishlist

Jumbo Interactive Ltd (ASX: JIN)

According to Arden Jennings of Ausbil Investment Management, shares in ASX-listed Jumbo make for an attractive proposition. The online lottery business has been humming along this year, producing record numbers. In its FY21 full-year results, Jumbo reported a 17% increase in revenue to $83.3 million. Meanwhile, underlying net profit after tax climbed 7% higher to $28.3 million.

Jennings, a portfolio manager of a small and micro-cap fund, highlighted an expected increase in the chance of jackpots next year following a change to the Oz Lottery. Bigger jackpots tend to correlate with larger ticket sales, which would benefit the company.

In addition, Jennings shared an appreciation for Jumbo’s approach to international expansion. In November 2019, it acquired UK digital lottery solution provider Gatherwell. More recently, Jumbo announced the acquisition of Stride, opening the gates to the Canadian lottery market.

A big positive, in Jennings’ opinion, would be if the company could get ahold of a US state lottery business in the next 12 to 24 months.

Estia Health Ltd (ASX: EHE)

The other number one ASX share for 2022 is from Tobias Yao of Wilson Asset Management. In Yao’s opinion, the ASX-listed residential aged care provider could be set for a big year in 2022. Despite the lingering concerns of COVID-19, Estia has returned ~24% to shareholders this year, but there could be more to come from Yao’s view.

Importantly, an end to the regulatory uncertainty is anticipated by the fund manager. This would remove a layer of skepticism towards the sector. Additionally, the government spending outlined in the federal budget could give companies like Estia a boost.

Finally, Yao mentioned the heightened merger and acquisition activity within the sector. At a market capitalisation of ~$570 million, the ASX share might find itself a suitor in 2022.

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Motley Fool contributor Mitchell Lawler owns shares of Jumbo Interactive Limited. The Motley Fool Australia's parent company Motley Fool Holdings Inc. owns shares of and has recommended Jumbo Interactive Limited. The Motley Fool Australia has recommended Jumbo Interactive Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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