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3 ASX shares I’d buy today with $5,000

Tristan Harrison
Where to invest

The ASX is predicted to gio up when it opens this morning with trade talk worries easing.

It’s unlikely to recover all the ground lost this week at the open or indeed today, so it could be an opportunity to buy some shares before they rise too much.

Here are three of my ideas:

Webjet Limited (ASX: WEB) – $2,000

Travel companies aren’t seen as particularly defensive, which is why Webjet fell over 5% this week.

Webjet is growing its consumer business at a pleasing rate but it’s the business to business subsidiary, WebBeds, which has investors and management excited because of how fast and consistently total demand is going up in this industry.

WebBeds is already one of the biggest providers in the world and management are aiming for an earnings before interest, tax, depreciation and amortisation (EBITDA) margin of 50%. This would be great for Webjet and all new revenue will be a large bonus.

Excluding Thomas Cook, Webjet continues to grow at an attractive double digit pace. Webjet is trading at only 13x FY21’s estimated earnings.

Brickworks Limited (ASX: BKW) – $2,000

Brickworks may be missed by a lot of investors because they think of the company as just a building products business.

However, its entire market capitalisation is backed by the value of its share and property investments which provide reliable earnings and long-term growth.

The property decline over the past couple of years has caused a slowdown in the construction sector but this is expected to reverse with Brickworks receiving more demand every month.

It’s trading at only 15x FY20’s estimated earnings.

Duxton Water Ltd (ASX: D2O) – $1,000

The water entitlement business has seen its assets rise strongly because of the ongoing drought.

I’m always on the lookout to buy shares when they’re trading at a good discount to assets or intrinsic value. Every month it releases the net asset value (NAV) per share of its business so you can see if it’s trading at an attractive discount or not.

The post-tax NAV of $1.72 and pre-tax NAV of $1.95 means that Duxton Water’s pre-open share price of $1.37 is trading at a discount of 20% and 30% respectively to its assets.

Foolish takeaway

I think each of these ASX shares have long-term futures and are attractively priced for an opportunistic buy. It’s hard to find shares at good value these days with how high asset prices have gone.  

The post 3 ASX shares I’d buy today with $5,000 appeared first on Motley Fool Australia.

If I had another $5,000 to invest I’d want to put it towards these top ASX shares.

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Motley Fool contributor Tristan Harrison owns shares of DUXTON FPO. The Motley Fool Australia has recommended Brickworks, DUXTON FPO, and Webjet Ltd. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

The Motley Fool's purpose is to help the world invest, better. Click here now for your free subscription to Take Stock, The Motley Fool's free investing newsletter. Packed with stock ideas and investing advice, it is essential reading for anyone looking to build and grow their wealth in the years ahead. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson. 2019