3 ASX All Ordinaries shares I'm watching like a hawk in March

These three ASX shares look very compelling to me.

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Key points

  • MyState shares are hitting lows, yet profit of the financial services business is rising and it’s aiming for longer-term operational improvements
  • Best & Less continues to grow its store network, it’s valued very cheaply, and has a big dividend yield
  • Healthcare software business Volpara just benefited from a helpful ruling in the US

March is becoming an eventful month amid the drama created by the failed US Silicon Valley Bank. I think in this environment, there are a number of All Ordinaries (ASX: XAO) shares that could be ones to watch.

Silicon Valley Bank's collapse represents the largest US bank failure since the Global Financial Crisis. Time will tell how this plays out.

However, there are some All Ordinaries ASX shares that could be compelling buys this month.

MyState Ltd (ASX: MYS)

MyState describes itself as a diversified financial services business, consisting of MyState Bank and TPT Wealth, a trustee and wealth management company.

It wouldn't surprise me to see this business hit a 52-week low this week amid all the banking uncertainty.

The business recently announced its FY23 half-year result for the six months to 31 December 2022, which showed net interest income rose 21.3%, while earning per share (EPS) increased 18% to 18.6%. New to bank customers increased 54% on the prior corresponding period.

It's benefiting from the higher interest rate environment. The All Ordinaries ASX share currently offers a grossed-up dividend yield of 8.8%, which is a solid dividend return in my opinion.

The business is focused on growing its market share on a "profitable and sustainable basis", with a target of "reducing its cost to income ratio to less than 60% in the medium term and creating cumulative return on equity (ROE) and EPS growth of 30% over the next three years".

Best & Less Group Holdings Ltd (ASX: BST)

Best & Less describes itself as a leading value apparel specialty retailer with an omnichannel sales network comprising 245 physical stores and an online platform. It aims to be the "number one choice" for mums and families buying baby and kids' 'value apparel' in Australia and New Zealand, both through its own brand in Australia and Postie in New Zealand.

In an environment where household budgets are tightening, I think Best & Less could be one of the businesses that may see resilient demand, or even growth.

The business is planning to keep opening new stores to help its growth, while investing in the business in a number of ways which should help the business become more efficient in the next few years.

In the first seven weeks of the second half of FY23, the All Ordinaries ASX share saw total sales growth of 3.8%, which is useful for the company in my opinion.

Commsec numbers suggest the Best & Less share price is valued at 8x FY23's estimated earnings and 6x FY25's estimated earnings. The prediction is that the grossed-up dividend yield could be 12.9% in FY23.

Volpara Health Technologies Ltd (ASX: VHT)

Volpara says it makes software in a bid to protect families from cancer. The idea is that healthcare providers use Volpara's software to better understand cancer risk and guide recommendations about additional imaging, genetic testing, and other interventions.

The AI-powered image analysis enables radiologists to quantify breast tissue and help technologists produce mammograms.

A new US federal regulation has just been finalised by the US Food and Drug Administration (FDA) "requiring mammography facilities across the country to inform patients whether their breasts are composed of dense tissue".

Within the next 18 months, by September 2024, all patient reports and summaries must include certain language about breast density.

I think this is very positive for Volpara considering it's one of the leaders of breast screening technology in the US. This could enable ongoing average revenue per user (ARPU) growth, which is useful considering the gross profit margin is above 90%.

The business is aiming to achieve positive cash flow as soon as possible, which could be a boost for investor sentiment about the All Ordinaries ASX share. The Volpara share price is down 55% since early February 2021.

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 Volpara Health Technologies. The Motley Fool Australia has positions in and has recommended Volpara Health Technologies. 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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