3 compelling ASX value stocks to consider this week

With the S&P/ASX All Ordinaries Index (ASX: XAO) making remarkable gains since the Liberation Day dip, ASX value investors may find themselves stretching the surface for ideas. 

Since the 7 April low, the All Ords has risen 14%. Liberation Day woes now seem like a distant memory.

If you're an ASX value investor looking to buy ASX value stocks this week, you may be interested in the following three ideas. 

Medibank Private Ltd (ASX: MPL)

Medibank Private is Australia's leading private health insurance provider, that's likely to tick many boxes for ASX value investors. In 2024, it covered more than 4 million customers. Medibank directly benefits from higher health insurance premiums. Last month, Medibank increased its premium by 3.99%. 

At 26 times earnings, Medibank Private is reasonably valued. The company offers a fully franked dividend yield of 3.6%. It also has a history of growing its dividend. In 2024, it grew by 14%, which should please dividend investors. 

Over the past 5 years, Medibank Private has beaten the market by a substantial margin. It is up 66%, while the S&P/ASX 200 Index (ASX: XJO) has risen 54%.

APA Group (ASX: APA)

Another ASX value stock to consider is Australia's largest natural gas infrastructure business, APA Group. Its 5-year share price return has been dismal, having declined 27% over the period. However, conditions appear to be turning around, with its share price up 18% this year. APA is forecasting strong demand for gas beyond 2050 due to the electrification of the economy, including AI and data centres.  

APA Group is likely to appeal to passive income-oriented investors. It offers a dividend yield of 6.8%. While this is unfranked, it has balance sheet capacity for divided growth. This means its dividend could rise even higher.

Metcash Ltd (ASX: MTS)

A final ASX value stock to consider is Metcash, which is well-positioned to benefit from the upcoming interest rate cutting cycle.

It is an Australian wholesale distributor that operates through food, liquor, and hardware segments. The food business supplies IGA supermarkets around the country. Meanwhile, the liquor segment supplies independent retailers including Bottle-O, IGA Liquor, Porters, and Thirsty Camel. The Reserve Bank of Australia (RBA) is expected to cut interest rates several times this year. That's likely to boost demand for its hardware segment,

Metcash offers a fully franked dividend yield of 5.1%, a compelling reason for passive income-oriented investors to take note. Its share price is up 38% over 5 years, trailing the ASX 200. However, with a price-to-earnings (P/E) ratio of 14, it could be positioned to outperform the market in the coming years. This makes it a potential top ASX value stock at the current price.

The post 3 compelling ASX value stocks to consider this week appeared first on The Motley Fool Australia.

Motley Fool contributor Laura Stewart has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has positions in and has recommended Apa Group. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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