In the fourth part of 22 ASX shares for 2022, we’ll be taking a look at four shares (and one expected to list in 2022) that have the potential to outperform.
If you haven’t already, check out the release of Part 1, Part 2 and Part 3.
1. Block Inc (NYSE: SQ)
Block, formerly Square, announced its $39 billion takeover of Afterpay Ltd (ASX: APT) last year.
As part of the deal, the company will launch a secondary listing on the ASX to enable Australian investors to get exposure to Afterpay and Block’s broader payment (and crypto) activities.
The Block share price has almost halved since its high in August last year, largely due to (a lack of) profitability and reliance on bitcoin revenue.
However, it will be one of the biggest companies on the ASX when it lists and is worth watching over 2022.
2. REA Group Limited (ASX: REA)
Owner of property portal realestate.com.au, REA Group is considered one of the highest quality businesses on the ASX.
It has a monopoly position over property listings, and through the acquisition of Mortgage Choice, is branching out into home loan financing.
The business also owns an 18% stake in Property Guru, which owns leading property marketplaces in Singapore, Thailand, Malaysia, Vietnam and Indonesia.
REA is a business that will always look optically expensive, but I suspect it has further growth ahead to justify the lofty expectations.
3. Kogan.com Ltd (ASX: KGN)
With its share price falling by more than half over 2021, it comes as a surprise to see Kogan make the cut. After all, Kogan was among the worst-performing ASX 200 shares in 2021.
Despite its operational failures (inventory, warehousing, slowing growth), Kogan still expects to triple sales over the next five years to $3 billion.
Even if it reaches half of that goal, it will double revenue and thus should be a larger business going forward.
4. Crown Resorts Ltd (ASX: CWN)
In what may be a bold call for 2022, I expect Australia’s largest casino operation to go private.
The business has repeatedly been linked to private equity. Currently, it has a $12.50 per share offer from Blackstone on the table, its third attempt at securing the casino giant.
The reporting of its checkered history of wrongdoing is only exacerbated by its public company status.
Add in the Packer family needing to offload a sizable chunk of shares and private equity looks the logical suitor.
5. NextDC Ltd (ASX: NXT)
NextDC is essentially a wager on data.
Every tweet needs to be stored. Every picture and video saved. Every document is available in the cloud for collaboration.
Despite devices such as the iPhone increasing storage (14 years ago, the original iPhone had 4GB of data, now it has 128GB), more and more data is moving into the cloud.
NextDC is leveraged to this long-term trend and will continue to benefit over 2022.
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