2 ASX shares to buy that are at 52-week lows

Goldman Sachs thinks these beaten down shares are buys.

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During today's session, a good number of ASX shares tumbled into the red.

And unfortunately for the two in this article, they fell to 52-week lows during today's play.

But if analysts at Goldman Sachs are to be believed, this could have created a compelling buying opportunity for investors.

Here's what the broker is saying about these beaten down ASX shares:


The IGO share price dropped to a 52-week low of $6.49 on Wednesday. Investors have been hitting the sell button this year amid concerns over how weak lithium prices are impacting the battery materials miner's performance.

However, Goldman believes that IGO is well-placed to navigate the tough operating conditions thanks to the low costs of its Greenbushes operation. It said:

Greenbushes is the lowest cost lithium asset in our coverage; Production growth more than offsets increasing strip ratio: The addition of CGP3 (under construction) and CGP4 (planned) should take Greenbushes production capacity from ~1.5Mtpa today to ~2.4Mtpa (excluding tailings processing of ~0.3Mtpa), and they are planned to be funded from existing Greenbushes debt facilities, combined with Greenbushes cash flows (though we factor in below nameplate). We reiterate our belief that further Greenbushes expansion remains one of the most economically compelling brownfield lithium projects.

Goldman has a buy rating and $8.10 price target on the ASX share. This implies potential upside of 25% for investors over the next 12 months.

Orora Ltd (ASX: ORA)

Another ASX share that fell to a new 52-week low on Wednesday is Orora. It is a leading packaging company.

Its shares dropped to a low of $2.03 during today's session, which means they are now down by 30% on a 12-month basis.

While this has been driven by a disappointing performance from Orora this year, Goldman Sachs believes the selling has been overdone and created a buying opportunity. It said:

We believe the legacy business benefits from relative top-line defensiveness, continued self-help in the Americas and growth capital investments that are underway in the Australasian business, while Saverglass is likely to experience near-term volume headwinds, though revert to benefit from the alcohol premiumisation trend, albeit at a slower rate than in the past ~15 years of rapid growth. We are Buy rated on the stock and believe the current market implied valuation of Saverglass provides a favourable risk-reward skew.

Goldman has a buy rating and $3.00 price target on the ASX share. This suggests that it could rise by 46% over the next 12 months.

Motley Fool contributor James Mickleboro 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 Goldman Sachs Group. The Motley Fool Australia has recommended Orora. 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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