Although the S&P/ASX 200 Index (ASX: XJO) has recovered from its lows in 2022, it remains down 5.5% year to date.
However, this modest looking decline is a touch misleading due to some index heavyweights such as BHP Group Ltd (ASX: BHP) and Commonwealth Bank of Australia (ASX: CBA) having solid years.
BHP's shares, for example, are in positive territory this year even after the miner demerged its energy operations to Woodside Energy Group Ltd (ASX: WDS). The latter is up ~70% year to date thanks partly to this.
A better gauge of how share markets are performing this year might be the S&P 500 Index (SP: .INX) on Wall Street. This famous index is arguably more balanced than the local ASX 200 index and remains down almost 18% in 2022.
For me, this is an indication that there are plenty of cheap shares out there for investors if you look outside the sectors that are on form this year.
With that in mind, here are two cheap-looking ASX shares that might be a bargain for investors' portfolios.
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An appliance maker tipped for strong growth
The first ASX share that could be going cheap right now is Breville Group Ltd (ASX: BRG). Since the start of the year, the appliance maker's shares have lost a whopping 39% of their value.
This leaves the Breville share price trading at approximately 23 times FY 2023 earnings based on Goldman Sachs' estimates. This is at the low end of the earnings multiple ranges of 20 times to 30 times it has traded at over the last six years.
You might think that this decline is because its strong growth is coming to an end. However, as far as Goldman Sachs is concerned, that's an incorrect assumption. It believes Breville's global expansion and exposure to the at-home coffee market is going to underpin a net profit after tax compound annual growth rate (CAGR) of 12% through to FY 2025.
In light of this, its analysts recently slapped a buy rating and $23.40 price target on its shares. This implies a potential upside of over 18% from current levels.
Pizza chain operator going for 50% off
The Domino's Pizza Enterprises Ltd (ASX: DMP) share price has been having a terrible time in 2022 and has lost almost half of its value. This has been driven by softer sales and inflationary pressures on its margins.
Analysts at Morgans believe the selling has been overdone and highlight that Domino's "cost pressures are intense in the near-term, but they will pass."
In light of this, the broker thinks that investors should be grabbing hold of a quality company before the headwinds reverse. It commented:
We believe these pressures are transitory in nature. In our opinion, now is the best time to consider an investment in a quality business like DMP that is facing headwinds that will reverse in time.
I agree with this view. In fact, I agreed so much I bought Domino's shares this month.
Morgans currently has an add rating and an $88 price target on the company's shares. Based on the current Domino's share price, this suggests a potential upside of 36% for investors over the next 12 months.
