The last few months have been rough for retail businesses.
There have been immediate headwinds galore — supply chain delays, the Omicron variant of COVID-19, inflation, and now a war in Europe.
The amount of stress the sector has had to bear is reflected in how the S&P/ASX 200 Consumer Discretionary (ASX: XDJ) has plunged almost 12% this year so far.
The selloff, however, might have gone too far for some ASX shares.
After all, the businesses themselves may not have changed much and the macroeconomic headwinds are transient.
Some experts nominated a pair of Australian retail stocks that are in exactly this position, and that they would buy up right now:
Time to buy this beauty
Let's not beat about the bush.
The Adore Beauty Group Ltd (ASX: ABY) share price has plummeted a brutal 58% since early November.
However, Fat Prophets founder and chief Angus Geddes sees nothing but upside now.
"We expect this online beauty retailer to benefit from the economy reopening," he told The Bull.
"The company will launch on its apps a new, profit-accretive, private label brand. We expect the company's beauty subscription business to generate earnings growth."
Certainly, the directors running Adore Beauty reckon it can't get any worse. The Motley Fool reported last week that 2 board members had bought a total of $1.7 million worth of stocks recently.
UBS analysts agree with Geddes, putting a price target of $4.70, which is more than double the current level.
"The company's apps and products are wide-reaching, generating quality profits and cash flows," said Geddes.
'Looking attractive'
Furniture retailer Nick Scali Limited (ASX: NCK) has similarly seen its share price nosedive in recent weeks, dipping more than 26% for the year thus far.
Spotee Connect analyst Chris Batchelor said this just makes it more mouth-watering as a buy candidate.
"A recent share price retreat leaves Nick Scali looking attractive on a recent price/earnings multiple of 11.5 times," he said.
"Sales boomed during the pandemic, as people diverted their spending from travel to sprucing up their homes."
Not only is it cheap at the moment, Nick Scali shareholders are reaping a tidy 5.24% dividend yield.
"The furniture retailer has a network of stores in Australia and New Zealand," said Geddes.
"It recently acquired Plush-Think Sofas, lifting its store footprint by 75%."
Analysts at Citi this month forecast that the dividend would increase further this year, taking the grossed-up yield to a whopping 9.5%.
