When high-quality or fast-growing businesses drop well below their previous highs, it can create an attractive setup for patient investors. Especially when the underlying growth story hasn't disappeared, but sentiment has.
Right now, there are a couple of ASX shares that still trade under $30 per share, despite once commanding far higher prices. They aren't guaranteed winners, but they are the kind of wealth-builders that can surprise on the upside when conditions improve.
Here are two that stand out.
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Life360 Inc (ASX: 360)
Life360 Inc has built a global platform around family safety, location sharing, and digital peace of mind. It operates a subscription-based model with strong network effects, meaning the product becomes more valuable as more people use it.
Despite continuing to grow its user base and improving monetisation, Life360 shares are currently trading at $29.62. That's a long way below their 52-week high of $55.87.
This pullback reflects a broader derating of growth stocks rather than a collapse in the company's fundamentals. Markets have become far more demanding when it comes to profitability, margins, and cash flow, and that shift has weighed heavily on technology names.
However, Life360's long-term opportunity remains substantial. The company is still early in its global growth journey, with significant scope to lift average revenue per user and expand its subscription base over time.
Bell Potter sees a lot of value in its shares. It has a buy rating and $52.50 price target on them.
TechnologyOne Ltd (ASX: TNE)
TechnologyOne is a very different type of business, but one that also fits the fallen favourite profile.
The enterprise software provider has spent decades building mission-critical systems for governments, councils, and large organisations. Its shift to a SaaS model has delivered recurring revenue, high customer retention, and strong long-term growth. These are traits the market once rewarded very generously.
Today, TechnologyOne shares are changing hands at $27.23, well below their 52-week high of $42.88. That decline has been driven by slightly softening (but still quick) growth and broader weakness across technology stocks, rather than a breakdown in the business itself.
With long-term contracts, sticky customers, and predictable cash flows, TechnologyOne remains a high-quality operator. If sentiment toward profitable software stocks improves, it wouldn't be surprising to see the market reassess how much it is willing to pay for that stability and growth.
Morgan Stanley is bullish on TechnologyOne. It has an overweight rating and $36.50 price target on its shares.
