Every expert seems to be warning investors to be selective about which ASX shares to buy at the moment.
With consumers and businesses starting to tighten their belts after a year of interest rate hikes, "quality" is an often-used word currently among professional investors.
"The market is fairly priced, but there's still pockets of value and there's pockets of overvaluation," Schroders portfolio manager Ray David told The Motley Fool last week.
"The market, we think, is going to be volatile going forward."
Fortunately, two of David's peers named a pair of stocks that they deem high enough quality to buy in the current market:
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Revenue up 50% already but further boost coming
Medallion Group analyst Jean-Claude Perrottet told The Bull that international education services provider IDP Education Ltd (ASX: IEL) delivered "strong results" for the last financial year.
"The company lifted revenue by 50% on the prior corresponding period."
As the world gradually shifted to a post-COVID era in 2022, the IDP share price crept upward as investors anticipated the free movement of students across borders once again.
Since mid-June, the stock has rocketed 50% higher.
But a recent catalyst makes Perrottet believe the party will continue for a while yet.
"China recently banned its students from online learning at overseas universities," he said.
"We expect IDP Education to benefit from an influx of Chinese students returning to Australia."
IDP shares are currently something of a darling among the professional community. According to CMC Markets, eight out of 10 analysts call it a buy.
Higher cash margins to come
Bell Potter Securities investment advisor Christopher Watt named Netwealth Group Ltd (ASX: NWL) as a buy.
"Netwealth is a financial services company. Funds under administration increased 10.2% or $5.8 billion for the 12 months to December 31, 2022, despite negative market movement of $4.6 billion."
The Netwealth share price is down 9% over the past 12 months.
Watt admitted recent in-flows had been "weaker than expected" but was upbeat about the future.
"We anticipate an improvement underpinned by recent client wins," he said.
"Further, higher cash margins and slowing cost growth are expected to result in stronger earnings growth."
Other professionals aren't quite as convinced about Netwealth. Only six out of 13 analysts currently surveyed on CMC Markets rate it as a buy.
