1 top ASX bargain stock that's ready for a bull run!

The market savaged these shares during reporting season, but multiple experts are bullish for the years to come.

| More on:
Modern accountant woman in a light business suit in modern green office with documents and laptop.

Image source: Getty Images

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

I've noticed in recent times that there's a particular stock that nosedived during reporting season, but many experts are still backing it.

So that might mean that a golden opportunity has opened up to buy some cheap ASX shares.

MA Financial Group Ltd (ASX: MAF) provides a wide range of financial services such as asset management, corporate advisory, and lending.

The share price, unfortunately, dived more than 20% on the day that its full-year results were revealed last month.

The stock still remains well below what it was most summer.

Let's explore what's going on here:

Spending money now to make money later

Glenmore portfolio manager Robert Gregory explained that the 2023 financial year numbers were about 8% below market expectations.

"FY23 EBITDA was $81.6 million (down -24%), whilst NPAT was $41.6 million (down -32%)," he said in a memo to clients.

"The result was impacted by MAF investing for growth in areas such as MA Money, the expansion of the Private Credit business in the US, and new distribution channels in Singapore."

Despite the savage market reaction to the result, there were bright spots.

"Management fees (which are largely recurring), increased +22% to $153 million.

"MAF said investments in various growth initiatives will continue into 2024 (which surprised the market), which will impact EPS by ~6 cents per share, albeit should benefit earnings from FY25 onwards."

And this is why so many professionals are, with a long-term horizon, bullish on MA Financial shares.

The 4% fully franked dividend yield also helps the argument that these are cheap ASX shares.

The analysts at Celeste Funds pointed out it's already pretty close to heading into the black and the year ahead looks positive.

"MA Money is forecast to breakeven in 2H24," they said in a memo to their clients.

"The Corporate Advisory & Equities business endured a difficult year but should rebound as capital markets reopen."

Broking platform CMC Invest is currently showing all three analysts surveyed as recommending MA Financial as a strong buy.

Motley Fool contributor Tony Yoo has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has recommended Ma Financial Group. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

More on Cheap Shares

Couple looking at their phone surprised, symbolising a bargain buy.
Cheap Shares

3 ASX shares that look way too cheap to ignore right now

Analysts think these shares could be in the bargain bin right now.

Read more »

Smiling couple looking at a phone at a bargain opportunity.
Cheap Shares

2 cheap ASX shares to add to your portfolio before they get expensive

Analysts think these shares are undervalued at current levels.

Read more »

A woman sets flowers on a side table in a beautifully furnished bedroom.
Cheap Shares

2 cheap ASX shares that offer at least 9% dividend yields

I'd look at these stocks for a cheap valuation and big passive income.

Read more »

Scared people on a rollercoaster holding on for dear life, indicating a plummeting share price
Cheap Shares

5 oversold ASX shares to buy in April 2024

Looking to snap up an ASX bargain this month?

Read more »

Smiling couple looking at a phone at a bargain opportunity.
Cheap Shares

In this bull market, where are the bargain buys to be found?

Here's how I'm looking for cheap shares in an expensive market.

Read more »

Couple at an airport waiting for their flight.
Cheap Shares

Is Qantas a bargain ASX 200 stock today?

Analysts at Goldman Sachs think the Flying Kangaroo could be dirt cheap.

Read more »

Doctor doing a telemedicine using laptop at a medical clinic
Cheap Shares

1 secretly cheap ASX 200 stock I'm buying for the long run

The best performer on the index last year has had a poor start to 2024. Let's examine whether this is…

Read more »

A young woman sits on her bed holding a cup of coffee inside her recreational vehicle hired through the Camplify website
Cheap Shares

3 struggling ASX shares to buy at a discount

These stocks are down temporarily because of temporary issues. This could be a golden opportunity to buy cheap.

Read more »