Stock Market Rally: How I Would Invest $5,000 in ASX Stocks Right Now

Stock Market Rally: How I Would Invest $5,000 in ASX Stocks Right Now

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The last few trading days have been very strong looking at some markets. And in my opinion there are some ASX stocks that look like attractive buys.

A lot of damage has been done to valuations this year due to factors such as inflation and higher interest rates.

But not with the latest US inflation number quite As much as expected, some stock prices jumped in response. For example, since November 9, 2022 (over two trading days) the S&P500 (INDEXSP: .INX) is up 6.5%. That’s a huge increase in just a few trading sessions.

It’s impossible to say what the stock market will do next. But since investors seem to want to push stock prices higher, I think it’s worth considering what I would do with $5,000.

First, I would invest $2,000 in Airtasker stock. This company runs a platform that tries to match people who need work with individuals or companies who want to get the job done.

After a 60% drop in Airtasker’s stock price in 2022, I think it’s looking very attractive.

The business is growing rapidly in both the UK and US, albeit from a small base. The UK and US are both much larger markets than Australia, so there could be a lot of potential there.

One of the most attractive things about ASX stock to me is that it has a gross profit margin of over 90%. That means most of the new revenue is converted into gross profit, which can then be reinvested back into the business to help the company grow.

Overall growth is going well. In the first quarter of FY23, revenue (excluding the acquired Oneflare business) grew 36% to $8 million.

Australian Ethical Investment Ltd (ASX:AEF)

I would also want to invest $1,500 in Australian ethical stocks. This is a fund manager that aims to offer investment products that are in line with an investor’s ethics.

It offers retirement plans and managed funds that avoid investing in things that, for example, “pollute land, air or water” or “extract, create, produce, manufacture or market any material, product, goods or service that has harmful effects on the Humans have , nonhuman animals or the environment.”

Over the long term, the company’s funds under management (FUM) continue to grow, which can provide a natural boost to sales and profits. I’m particularly drawn to the fact that it offers retirement benefits, so it benefits from regular contributions from employee pension guarantee payments.

In the three months ended September 2022, total FUM of ASX stock (excluding institutional investors) increased from $6.02 billion to $6.18 billion, including $150 million in net retirement savings.

I think the continued FUM growth will help the Australian Ethical share price to rise over time. It may also benefit from the inclusion of the Christian Super Members who are included in Australia’s ethical pension options.

Temple & Webster Group Ltd (ASX:TPW)

The last $1,500 I would invest is in the shares of this furniture and home goods retailer.

I think Temple & Webster’s stock price is looking a lot better after falling about 60%.

While business has seen an e-commerce boom during the COVID-19 era, I believe the number of online purchases people are making will increase over time.

I like the company’s efforts to diversify and grow its revenue by selling more items, particularly in the home improvement categories of paint, plumbing, flooring, and so on.

I’m impressed with the technology that ASX stock is now offering to its clients. For example, it offers augmented reality so people can “see” a product in their space. It is also developing an artificial intelligence-based interior design service.

While FY23 earnings may be volatile, I think the long-term future looks bright.

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