Are These Oversold ASX Stocks Offering a Good Investment Opportunity?

Team Veye | 09-Sep-2024

Oversold ASX Stocks often create a chance to buy stocks at a bargain as these stocks often rebound quickly. Recognising such an opportunity is not an easy task though but Most Undervalued Stocks if picked at the right time can give very good returns.

Two such oversold stocks are

humm Group Limited (ASX: HUM)

humm Group’s FY24 financial performance delivers some positive outcomes.

A robust turnaround with a 145% increase in statutory net profit to $7.1 million, driven by a strong second-half recovery. The 18% growth in total receivables, with notable increases in both commercial and consumer finance segments, signals effective business expansion.

For FY24, Point of Sale Payment Plans (PosPP) volumes grew by 25%, with hummAU achieving a 17% increase to $720.5 million, and global businesses expanding 55%. The second half of the year saw a turnaround with a normalized cash profit of $0.7 million, a $5.7 million improvement from the first half, despite $2.2 million in costs for the upcoming humm Hybrid Loan Product. This new product is expected to boost profitability

The company’s solid balance sheet, highlighted by $125.1 million in unrestricted cash, underscores its financial stability and liquidity. Although normalized cash profit fell by 19% to $60.6 million, the positive second-half performance suggests improvements are underway. The stable net interest margin of 5.5% and controlled credit losses at 1.8% reflect sound financial management.

Additionally, $13.2 million in cost savings and a fully franked dividend yielding 6.02% demonstrate a commitment to shareholder returns and efficient cost control.

The introduction of Group's new Forward Flow Program marks a positive advancement, presenting an innovative structure and fresh revenue model. This program enables the company to support its Commercial business growth without utilizing its own capital. Flexicommercial will continue to manage loans and receivables through its broker network, earning origination fees, servicing fees, and a share of the excess spread, all without recognizing these assets on its balance sheet. This approach not only mitigates credit risk and capital requirements but also introduces a novel revenue model. Overall, this development favors company’s growth, as it enhances funding flexibility, reduces financial risk, and supports future growth potential.

Overall, while investors would be encouraged by the strong profit growth and financial stability, they may also watch for continued progress in cash profit performance and cost management.

Beamtree Holdings Limited (ASX: BMT)

Beamtree Holdings Limited (ASX: BMT) reported a strong financial performance for FY24.

The results highlighted by a 21% increase in overall revenue, reached $27.6 million. The company's Annual Recurring Revenue (ARR) grew by 12% to $25.5 million, demonstrating solid recurring business. Non-recurring revenue saw a remarkable 129% increase, while recurring revenue rose by 9%. Significant operational improvements were evident, with a turnaround in operating profit to $0.4 million from a loss of $1.4 million in FY23 and a 58% increase in group EBITDA. Although cash flow slightly decreased to $5 million by year-end (30 June 2024), the overall financial health remains strong.

The 12% rise in operating costs reflects Beamtree's continued investment in innovation, positioning the company for sustained future growth.

Beamtree Holdings Limited secured the contract with Dr. Sulaiman Al Habib Medical Service Group (HMG). Winning a contract worth A$3.6 million is a significant achievement, especially in a sector as crucial as healthcare.

BMT is targeting a revenue growth of over 20% for FY25, alongside a commitment to delivering positive cash flow. The company projects a substantial 40% year-on-year growth in ARR, aiming to expand from $25.5 million in FY23 to $60 million by FY26. Beamtree is enhancing its organic growth while also broadening its operational scope. This includes the development of Canada-ready coding products and targeting the creation and deployment of UK-ready coding solutions. 

Additionally, Beamtree aims to achieve CE marking for its CDS product and deploy its first integrated coding platform proof of concept (POC) within Saudi Arabia. The company is also focusing on developing new coding opportunities across all healthcare sectors in KSA and plans to conduct coding reviews and deploy coding products in British Columbia and Ontario.

Source: Company’s Report

Disclaimer

Veye Pty Ltd(ABN 58 623 120 865), holds (AFSL No. 523157 ). All information provided by Veye Pty Ltd through its website, reports, and newsletters is general financial product advice only and should not be considered a personal recommendation to buy or sell any asset or security. Before acting on the advice, you should consider whether it’s appropriate to you, in light of your objectives, financial situation, or needs. You should look at the Product Disclosure Statement or other offer document associated with the security or product before making a decision on acquiring the security or product. You can refer to our Terms & Conditions and Financial Services Guide for more information. Any recommendation contained herein may not be suitable for all investors as it does not take into account your personal financial needs or investment objectives. Although Veye takes the utmost care to ensure accuracy of the content and that the information is gathered and processed from reliable resources, we strongly recommend that you seek professional advice from your financial advisor or stockbroker before making any investment decision based on any of our recommendations. All the information we share represents our views on the date of publishing as stocks are subject to real time changes and therefore may change without notice. Please remember that investments can go up and down and past performance is not necessarily indicative of future returns. We request our readers not to interpret our reports as direct recommendations. To the extent permitted by law, Veye Pty Ltd excludes all liability for any loss or damage arising from the use of this website and any information published (including any indirect or consequential loss, any data loss, or data corruption) (as mentioned on the website www.veye.com.au), and confirms that the employees and/or associates of Veye Pty Ltd do not hold positions in any of the financial products covered on the website on the date of publishing this report. Veye Pty Ltd hereby limits its liability, to the extent permitted by law to the resupply of services.

veye logo

Grab Your Free Report On 5 ASX Dividend Stocks To Buy In 2024

(+61)

SALE IS LIVE

Limited Time Deal:   Over 66% OFF

DIVIDEND
INVESTER REPORT

Dividend-Investor-Report

Each week we cover companies offering a good combination of growth & dividends, maintaining a balance between stable 'cash flow' and risker 'raising stars'. Our guidance helps you choose companies with regular dividends and opportunities for lower-risk capital growth.

  • The best High Yield Dividend Stocks picked by our team of analysts every week.
  • Detailed in-depth Analysis with our expert Recommendations Buy, Hold or Sell.
  • Free Daily Analysis Report to keep up with the latest on what's hot and what's not.
  • Gain instant access to a wide range of Dividend Share Reports, exclusive to members only.
Frequency: Every Tuesday