Prior to the Christmas break, Bell Potter named a number of its top picks for 2022.
Listed below are two ASX shares that it believes investors should be buying this year. Here's what the broker is saying:
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Accent Group Ltd (ASX: AX1)
The first ASX share for investors to look at is Accent. It is a leading retail and distribution company with a focus on performance and lifestyle footwear, apparel, and accessories.
Bell Potter is bullish on the company due to its positive outlook, undemanding valuation, and attractive dividend yield. It also sees a lot of potential in the Stylerunner business and expects it to be a key driver of growth in the future.
It commented: "The company's recent AGM update indicated strong forward momentum, including a material upgrade in expected store openings in FY22, a turnaround in Glue Store, continued sales traction in Stylerunner which we believe offers material growth prospects, and the signing of a new exclusive distribution agreement for Reebok. AX1's valuation is undemanding with FY23 PE of ~14x, and the dividend yield is an attractive ~5%."
Bell Potter has a buy rating and $3.05 price target on its shares.
Infomedia Limited (ASX: IFM)
Another ASX share that Bell Potter is positive on its Infomedia. It is a leading provider of software solutions to the parts and service sectors of the global automotive industry.
While the company was hit hard by COVID-19, Bell Potter notes that its performance improved greatly during the second half of FY 2021. Pleasingly, the broker expects this positive form to continue in FY 2022 despite the recent departure of its CEO.
Bell Potter explained: "We expect this good organic growth to continue into FY22 and this is consistent with the guidance which is for around 20% revenue growth (split roughly evenly between organic growth and an acquisition). The recent issue has been the sudden departure of the CEO but we don't believe this means there is anything wrong with the company and, rather, when a new CEO is appointed we see this as a likely catalyst for the share price."
Its analysts have a buy rating and $2.00 price target on Infomedia's shares.
