Top ASX shares to buy on discount in December 2024

2024 has been a cracker year for ASX shares, with the S&P/ASX 200 Index (ASX: XJO) up almost 11% since the end of 2023. And it's not over yet!

If history is anything to go by, and the traditional Santa rally delivers the goods, the Aussie share market could be in store for even more gains before the year is out.

In fact, over the last 24 years, the ASX 200 has risen an average of around 1.5% over the month of December. Despite the index dipping 0.28% so far this month, the possibility of investors locking in further gains before New Year's Eve looks plausible.

With so many ASX shares trading at multi-year or all-time highs, uncovering good-value buys right now can be harder than finding a red nose on a reindeer.

But come all ye faithful! Because our Foolish writers have scoured the Aussie bourse and delivered a sack full of discount ASX shares to put on your buy list right now.

6 great-value ASX shares for December 2024 (smallest to largest)

• Jumbo Interactive Ltd (ASX: JIN), $876.05 million
• Centuria Industrial REIT (ASX: CIP), $1.85 billion
• Domino's Pizza Enterprises Ltd (ASX: DMP), $3.00 billion
• Washington H Soul Pattinson & Company Ltd (ASX: SOL), $12.96 billion
• Brambles Ltd (ASX: BXB), $27.01 billion
• BHP Group Ltd (ASX: BHP), $206.51 billion

(Market capitalisations as of market close 6 December 2024)

Why our Fool writers love these cheap ASX stocks

Jumbo Interactive Ltd

What it does: Jumbo is the little Brisbane-based software developer behind the Oz Lotteries platform. This humble business is responsible for a major portion of all lottery tickets sold online in Australia. Additionally, the company sells its technology as a white-label solution for other charity and lottery providers and a 'white glove' offering through its managed services segment.

By Mitchell Lawler: The latest trading update from Jumbo won't be winning any prizes for being impressive. Lottery retailing metrics were down for the first four months of the financial year, and operating margins are expected to retreat in FY25. 

However, anyone who has been around the block a few times in the lottery world will know there's a degree of cyclicality to the industry arising from the number of large jackpots. Jumbo can't control this, so I try to assess the company on longer timeframes than year-to-year. 

By all accounts, this is a phenomenal company – strong historical revenue growth, high return on equity (ROE), tidy balance sheet, etc. Yet Jumbo doesn't appear to be attracting a premium valuation. For example, the free cash flow yield equates to 6.1%, which makes the company look like great value in my eyes. 

Motley Fool contributor Mitchell Lawler owns shares of Jumbo Interactive Ltd.

Centuria Industrial REIT

What it does: This real estate investment trust (REIT) owns a portfolio of industrial assets across Australia, mainly in New South Wales, Queensland and Victoria.

By Tristan Harrison: This ASX share is benefitting from a number of positive trends thanks to the types of properties it owns, including manufacturing and production plants, distribution centres, transport and logistics hubs, data centres, and cold storage facilities.

Various tailwinds, including increased e-commerce adoption, population growth, the onshoring of production and assembly, and increased data centre demand, are helping boost the company's overall rental demand.

In the first quarter of FY25, the business reported positive re-leasing spreads of 54%, which I think is a huge increase. This figure tells investors how much the rent on a new contract is compared to the old rental contract for the same building. 

At the end of 2024, Centuria Industrial reported it had net tangible assets (NTA) of $3.87 per unit, so the ASX share is trading at a 24% discount to this value.

Some investors may question whether the REIT's properties are worth as much as the NTA suggests in this high-interest-rate environment, but in FY24, the business sold $120 million of properties at a 4% premium to the balance sheet/book value. I think this goes some way to back up that NTA figure, and to me, the ASX stock appears to be trading cheaply relative to its underlying value.

As a bonus, it's expected to pay a distribution per unit of 16.3 cents in FY25, which equates to a distribution yield of 5.5% on current pricing.

Motley Fool contributor Tristan Harrison does not own units of the Centuria Industrial REIT.

Domino's Pizza Enterprises Ltd

What it does: Domino's is a leading pizza chain operator selling more than eight pizzas every second across its 3,700 stores in 12 markets.  

By James Mickleboro: I think Domino's Pizza Enterprises would be a great option for investors this month.

It is fair to say that the last three years have been very disappointing for the company and its shareholders. Some of this has been caused by COVID headwinds, but much of it has been driven by management mistakes.

But with the company recently announcing a new and improved strategy, focused on franchise profitability, and a much-needed change of leadership, I think Domino's fortunes could be about to improve materially.

In light of this and the discount its shares are trading at compared to historical multiples, I believe now could be an opportune time to invest. 

Goldman Sachs thinks investors should be buying. The broker recently put a buy rating and $39.10 price target on Domino's shares. Its buy rating is based on the company's "earnings recovery trajectory with new management and limited valuation downside".

Motley Fool contributor James Mickleboro owns shares of Domino's Pizza Enterprises Ltd.

Washington H Soul Pattinson & Company Ltd

What it does: Washington H Soul Pattinson & Company, or Soul Patts for short, is an investing house that owns and manages a massive portfolio of underlying assets on behalf of its shareholders.

By Sebastian Bowen: With the markets continuing to push higher, it is getting harder and harder to find quality companies at reasonable prices on the ASX. But Soul Patts still fits the bill in my eyes. 

This is a quality stock if ever there was one. Soul Patts has a decades-long streak of delivering market-beating performance, thanks in part to its large holdings in top shares like TPG Telecom and Brickworks. It also happens to hold the ASX's record for longest streak of uninterrupted annual dividend increases (24 years and counting!). 

Even though the ASX 200 has gained almost 11% in 2024 to date, Soul Patts shares have only risen by just over half of that. This, along with the company's own metrics, tells me that this company remains relatively cheap, given its track record of beating the index over many years.

That's why I recently added to my existing position and would again at Friday's closing price of $35.24.

Motley Fool contributor Sebastian Bowen owns shares of Washington H Soul Pattinson and Company Ltd.

Brambles Ltd

What it does: Brambles is the world's largest supplier of reusable wooden pallets sold under the iconic Chep brand. These pallets make their way around the world to more than 60 countries. 

By Zach Bristow: Brambles has a dominant market position in a relatively niche segment – wooden pallets. This automatically makes it a standout to me. But the company also has "excellent financials", according to John Hempton, founder of Bronte Capital. 

Hempton says the company has produced a 20% return on equity for the better part of 20 years. There's no reason for this to change in the near term, he says, making Brambles highly attractive. 

According to CommSec, the consensus of analyst estimates expects Brambles to grow profit by 15% in FY25. Analysts also project the company to deliver earnings per share (EPS) of 98.3 cents, stretching up to $1.07 the year after.

At the current price of $19.49 apiece, the forward price-to-earnings (P/E) ratio for FY25 is nearly 20x on these projections and 18x looking two years out. 

With the market trading at more than 26x P/E at the time of writing, Brambles' 15% projected earnings growth, and roughly 20% expected returns on equity, this is a highly attractive stock, in my opinion.

Motley Fool contributor Zach Bristow does not own shares of Brambles Ltd.

BHP Group Ltd

What it does: BHP owns top-tier mining operations in Australia, North America, and South America. The diversified resources company earns most of its revenue from iron ore, with copper coming in at number two and coal also providing significant income.

By Bernd Struben: After tumbling more than 19% in 2024 to the recent share price of $40.70, I believe BHP shares are likely trading at a long-term discount.

The miner has come under pressure this year amid a big retrace in the iron ore price. Having topped US$142 per tonne in January, the industrial metal traded below US$100 per tonne through much of September before lifting to around US$105 per tonne in recent trade.

Much of that pressure has come amid weak growth in China, which has impacted steel production. But I don't think the Chinese Government can afford to continue limping through 2025.

Hence, I expect that China's recently announced $2.5 billion stimulus measures will be followed by more significant measures in 2025. If this does indeed transpire, it should offer a boost to iron ore and copper prices, along with the BHP share price.

The miner recently reaffirmed it was on track to meet its FY 2025 production guidance.

Atop potential capital gains, BHP shares also trade on a fully franked trailing dividend yield of 5.4%.

Motley Fool contributor Bernd Struben does not own shares of BHP Group Ltd.

The post Top ASX shares to buy on discount in December 2024 appeared first on The Motley Fool Australia.

The Motley Fool Australia's parent company Motley Fool Holdings Inc. has positions in and has recommended Brickworks, CSL, Domino's Pizza Enterprises, Goldman Sachs Group, Jumbo Interactive, and Washington H. Soul Pattinson and Company Limited. The Motley Fool Australia has positions in and has recommended Brickworks and Washington H. Soul Pattinson and Company Limited. The Motley Fool Australia has recommended CSL, Domino's Pizza Enterprises, and Jumbo Interactive. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

The Motley Fool's purpose is to help the world invest, better. Click here now for your free subscription to Take Stock, The Motley Fool's free investing newsletter. Packed with stock ideas and investing advice, it is essential reading for anyone looking to build and grow their wealth in the years ahead. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson. 2024