2 Best ASX Growth Stocks Considered As Buys

The ASX 200 lost 71.20 points or 0.96% to 7,313 in early trade on Tuesday. The benchmark reversed its gains of 0.57% in the previous session following a mixed session on Wall Street. This was due to higher long term bond yields weighing on big tech stocks.

Our List of ASX Growth Stocks To Grow Your Investment Portfolio

As the market continues to pull back, we have found two rock-solid stocks that are ready for the rebound:

Myer Holding Limited (ASX: MYR)

Myer is Australia’s largest department store operator. The group has some 60 stores, mostly spread across eastern states. Stores are generally located in areas of high foot traffic in major metropolitan shopping centres. Competitive advantages include a well-established brand and scale benefits from a relatively large revenue base. The brand is somewhat iconic among Australian domestic consumers.

Myer share price jumps by almost 9% since a week on strong FY 2021 results. In the morning trade, the department store operator’s shares are up 2.46% to 62.5 cents.

For FY21, Myer reported a 5.5% increase in sales to $2,65 billion. A key driver of this growth was its online business, which delivered a 27.7% lift in sales to $539.5 million. This means that more than 20% of Myer’s sales are now generated online.

Furthermore, Myer’s solid sales growth was margin expansion. Hence, this was underpinned by the success of its Customer First Plan and its focus on profit sales. This led to Myer delivering an NPAT of $51.7 million for the period. This is a huge improvement on the $13.4 million loss it recorded a year earlier.

Despite its strong profit rebound, lockdown uncertainty means that its dividend will remain suspended for the time being. But we think that the business is well placed ahead of the upcoming peak trading period. Moreover, we have seen the company remaining agile in response to the various State-based lockdowns and travel restrictions.

As of the moment of writing, Myers is up by an impressive 115.5% year-to-date.

Coles Group Limited (ASX: COL)

Coles is originally Australia’s second-largest retailer behind Woolworths. The company was acquired by Wesfarmers in 2007. Coles Group was spun off from Wesfarmers in 2018. Since then, Coles shares were re-listed on the ASX. The group includes Coles Supermarkets, Coles Express and Coles liquor division. Coles is a giant. It processed more than 21 million customer transactions on average each week. The firm operates more than two thousand retail outlets nationally.

The Coles Group share price has been struggling in September. At the time of writing, shares in the supermarket and liquor retailer are trading for $16.62, down by 2.3%. Over the month, it was even bleaker for Coles. Shares in the company are down 7.35% while the ASX 200 is only 1.8% lower.

So, what’s going on with Coles? Well, one reason for the sluggish Coles’ price action may be because investors believe the COVID-19 gravy train for consumer staples is coming to an end. While most Australians are currently in lockdown, this is poised to end soon. The NSW, Victorian, and ACT governments have released roadmaps for ending stay-at-home restrictions. Hence, these jurisdictions should be leaving lockdown sometime between mid and late October. In fact, lockdowns have historically been a boon for consumer staples. As consumer options are limited and people are confined to their homes, sales at supermarkets do very well.

In its full-year results, Coles reported record revenue, earnings, and net profit. On top of that, the final dividend, fully franked, of 61 cents per share was a 6.1% improvement vis-à-vis the previous period.