S&P/ASX 300 Index (ASX: XKO) shares are among the largest companies listed on the ASX. However, some of them have gone through a decline in recent times, making them more attractive to me if it appears there's a good chance of a recovery for that particular stock.
A few names are so cheap, I'm calling them steals because of how far they have dropped and their potential to deliver pleasing investment returns.
One of the businesses I'll discuss is a key player in the Australian agricultural sector, and I'm optimistic about a cyclical rebound. The other business provides software for the hotel industry, and I believe it has an excellent opportunity to deliver growth.
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Elders Ltd (ASX: ELD)
Elders works with farmers to provide products, marketing options, and specialist technical advice across rural, wholesale, agency, and financial products and services. The business also has a rural and residential property agency and management network.
One key reason I'm interested in the ASX 300 share is that the Elders share price has declined almost 30% in the last year, and it's down around 55% from April 2022, as the chart below shows.
No one can say when agricultural conditions will improve for Elders and its clients, but because of how cyclical the industry can be, it could pay to be contrarian in this business.
The ASX 300 share's recent FY25 half-year result was promising – 5% revenue growth, 67% underlying operating profit (EBIT) growth, 166% underlying profit after tax growth, and a dividend per share of 18 cents.
If the business repeats the same dividend in six months, it'll have a partially franked dividend yield of 6.8%, including franking credits.
According to Elders, livestock prices and demand are forecast to remain strong, and a return to average seasonal conditions for the 2025 winter crop is predicted, which are all "positive conditions" for the business going into the second half. RBA rate cuts could help the regional residential property market, which would be supportive for the ASX 300 share too.
Overall, I think the company is being priced relatively negatively for its medium-term outlook.
Siteminder Ltd (ASX: SDR)
I think Siteminder is one of the most underrated ASX growth shares. It's already a global business with a presence in more than 150 countries. The company's software helps hoteliers unlock their full revenue potential. Over 2.3 million rooms across 47,200 properties are linked with Siteminder.
The Siteminder share price has fallen more than 30% from November 2024, as the chart below shows.
The ASX 300 share is growing at an impressive rate – in the FY25 half-year result, Siteminder reported annual recurring revenue (ARR) of $216.2 million, representing 22% year-over-year growth.
A significant portion of that ARR growth is coming from average revenue per user (ARPU) growth, which is primarily coming through upselling to customers rather than price rises.
As a software business, the company is in a strong position to deliver rising profit margins. There is relatively limited cost in providing software to one more hotel, so a good portion of that additional revenue can turn into profit.
The broker UBS is forecasting that Siteminder could turn positive at the net profit after tax (NPAT) line in FY26, achieving a net profit of $6 million in the new financial year and generating $284 million of revenue. By FY29, revenue could grow by 69% to $479 million, and net profit could increase to $54 million.
If those predictions come true, the current Siteminder share price is valued at 26x FY29's estimated earnings, which I think is appealing given its growth rate.
