Where to find value in growth? Here are 2 ASX shares I’d buy in July

Both of these ASX shares could achieve good things in the future.

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Key points

  • Here are two ASX shares that are rapidly growing, I think they’re worth paying attention to 
  • Temple & Webster is a leading online player in the homewares and furniture space 
  • Bubs is a rapidly-growing infant formula business that is seeing quick traction in the USA 

ASX growth shares could be the way to go in July 2022 with how share prices have largely been pushed lower in recent times.

There are concerns about a number of areas. Inflation, interest rates, the Russian invasion, energy prices, supply chains and so on.

There’s nearly always something to worry about, though there seems to be quite a few things at the moment.

However, as Warren Buffet says, a good time to be greedy when it comes to buying shares is when people are fearful.

Not only do I believe that this is a good time to buy ASX shares in general, but there are some specific ideas that I think are buys.

Temple & Webster Group Ltd (ASX: TPW)

The Temple & Webster share price is one of the ones that has suffered heavily in the sell-off.

Since the start of 2022, it has dropped by more than 60%. That’s despite the ASX growth share’s latest trading update showing ongoing double-digit growth.

For the period of 1 January 2022 to 30 April 2022, it said that revenue had increased by 23% year on year. This also represented 116% growth over a two-year period. I think that double-digit compounding growth year after year can add up.

Management is focused on ramping up the business by investing in various areas such as marketing, technology development, product range and the overall customer experience.

The business points to an ongoing rise in online shopping that can help it capture a bigger market share in furniture, homewares, home improvement and business customers.

Increased scale will help the business in various ways including cost advantages in product sourcing, logistics and marketing.

I think this ASX growth share has plenty of operational growth ahead of it, particularly with trade and commercial, and home improvement.

Bubs Australia Ltd (ASX: BUB)

Bubs is a fast-growing infant formula business. It specialises in goat milk infant formula, but it also has cow milk infant formula, toddler snacks and adult dairy products.

It’s growing revenue and scale quickly. The business recently gave an update where it said it was upgrading its FY22 guidance for gross revenue to be more than $100 million. It’s also expecting to at least double its underlying earnings before interest, tax, depreciation and amortisation (EBITDA).

Bubs has answered the call of the US government asking for help to alleviate the infant formula shortage in the company. It’s in the process of shipping 1.25 million tins to the US.

The company said that it’s seeing “strong momentum” in China and an unanticipated volume of sales in the USA.

Not only is the business doing well in the large markets of China and the USA, but it’s also achieving growth in Australian supermarkets and chemists, while also making partnerships in other Asian countries to lay the foundation for growth there.

Infant formula is a higher margin product for Bubs, so growth will help the company’s overall profit margin.

Motley Fool contributor Tristan Harrison has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has positions in and has recommended Temple & Webster Group Ltd. The Motley Fool Australia has recommended BUBS AUST FPO and Temple & Webster Group Ltd. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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