2 battered blue-chip ASX shares rated as purchases on January 7, 2022

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Some blue chip ASX stocks have been battered in recent weeks and months. But could that mean they’ve dropped enough to buy?

Just because a company is big or called blue chips doesn’t mean it can’t experience some volatility, as the market has seen with some of the ASX stocks mentioned below.

However, a drop in a stock’s price can turn a business into an opportunity if it still has long-term potential.

With that in mind, here are two ASX blue chips that could be possibilities after their declines:

TPG is one of the largest telecommunications companies in Australia with brands like TPG, Vodafone and iiNet in its stable.

The companies TPG and Vodafone Australia have gone through a long merger process so that the combined company can better compete with peers like Telstra Company Ltée (ASX: TLS).

This merger should lead to significant synergies, give the ability to offer better service to clients and provide more solid financial returns to shareholders.

TPG expects to exceed its 5G deployment target of 85% population coverage in the top six cities in 2021, reaching the milestone in four additional regions: the Gold Coast, Sunshine Coast, NSW Central Cost and to Wollongong.

The ASX Blue Chip share aims to achieve $ 70 million in synergies in 2021 through the merger, excluding home wireless synergies and revenue.

It is also undertaking a review of its telecommunications tower assets. TPG operates a mobile network of 5,800 rooftops and towers and has passive infrastructure at approximately 1,200 of these sites which are primarily located in metropolitan areas. He could choose to monetize these assets.

TPG is currently rated as a buy by UBS, with a price target of $ 7.60. That’s about a 30% increase over the next year, if the broker is correct. He expects to offer an increased dividend yield of 4.4% for FY22.

JB Hi-Fi is another big Australian company. It is a major retailer of electronics and household appliances.

The company’s latest sales update, which was for the first quarter of fiscal 22, showed year-over-year sales decline in each of its divisions. JB Hi-Fi Australia’s sales fell 7.9%, JB Hi-Fi New Zealand’s sales fell 6.4% and The Good Guys’s sales fell 6.1%.

However, JB Hi-Fi noted that there had been COVID restrictions impacting the situation and that it continued to see increased customer demand and strong sales growth rates over a two-year period.

Some analysts, such as Credit Suisse, were impressed that the first quarter was so strong thanks to the blue chip ASX stock.

JB Hi-Fi is focused on generating long-term sustainable growth. The company believes it has five unique competitive advantages that can help it grow and continue to generate attractive margins: scale, a low cost operating model, quality store locations, partnerships with suppliers and a multi-channel capacity.

Broker Ord Minnett is currently pricing JB Hi-Fi as a buy, with a price target of $ 54. He believes the retail industry will benefit from the continued high consumer spending due to various impacts of COVID.

Ord Minnett values ​​the JB Hi-Fi share price at 13 times estimated FY 22 earnings with a projected gross dividend yield of 7.3%.

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