Best 5 ASX stocks to watch in January 2022

Choosing what could be the best ASX stocks to watch at the start of this year is no easy task. As uncertainty lingers and the Reserve Bank of Australia maintains a hawkish stance, it can make sense to choose those with either a wide economic moat or those selling low-supply but in-demand products.

Both qualities may help the best ASX companies to weather the oncoming storm.

1. Arizona Lithium (ASX: AZL)

Headquartered in Perth, Arizona Lithium's main assets are situated in the United States and include the Big Sandy Project in Arizona and the Lordsburg Project in New Mexico.

The company's fortunes could receive a boost in 2023 from a concerted push by climate-conscious governments around the world to drive the uptake of clean energy vehicles. This will increase demand for lithium, given its key role in the production of electric batteries.

Arizona Lithium could further benefit from the support the US Federal Government is giving to lithium projects, as well as the proximity of the Big Sandy project to the Tesla Gigafactory.

According to the company, the Maiden Mineral Resource at Big Sandy is host to 320,800 tons of Lithium Carbonate Equivalent (LCE).

2. Chalice Mining (ASX: CHN)

Chalice Mining's flagship asset is the Julimar Project in Western Australia. This is a major greenfield platinum group element (PGE), nickel, copper, cobalt and gold discovery, whose discovery team won the 2023 Thayer Lindsley Award for best international minerals discovery.

The company claims to have ample funds, with a cash balance of AU$115 million as of the end of the third quarter of 2022.

Chalice Mining could see its share price rise on the inclusion of nickel and cobalt on the critical mineral lists of both Australia and the USA. Russia enjoys market dominance over these minerals, which play a critical role in the production of lithium-ion batteries and hydrogen fuel cells.

For this reason, stockbroking firm Bell Potter has given Chalice a speculative buy rating with a price target of $11.10. This compares to its latest share price of $6.56.

3. Accent Group (ASX: AS1)

First launched as a wholesale distributor in New Zealand in 1988, Accent Group Ltd has since evolved into a diversified footwear retailer with more than 500 stores, over 20 online platforms and 19 brands.

Stockbroking firm Bell Potter considers Accent one of its top picks for the retail sector in a tough consumer spending environment, given its exposure to a younger customer demographic.

Accent has a roughly 30% market share in the $3 billion Australian footwear retailing market, while Bell Potter sees further opportunity in the youth-focused sports apparel vertical.

For this reason, it has given Accent a buy rating with a $2.10 price target. The company's share price has recently sunk beneath $1.90.

4. Xero (ASX: XRO)

A developer of online accounting software for small businesses, Xero lays claim to 3.5 million subscribers spread across Australia, New Zealand and the United Kingdom. Xero says its cloud-based accounting solutions simplify everyday business administration for companies and improve efficiency.

Analysts at Morgans are upbeat about the prospects for earnings growth at Xero this year. They forecast a 185% surge in the company's earnings per share, from 10.6 cents per share in FY23 to 30.2 cents per share in FY24.

Morgans has given Xero a buy recommendation, with a $77 price target.

5. JB Hi-Fi Limited (ASX: JBH)

While e-commerce has changed the game for the retail sector, consumers still enjoy the convenience and certainty offered by shopping at brick-and-mortar outlets.

This may especially be the case when it comes to more costly products that bear repeated usage, such as home appliances, home entertainment systems and electronic goods.

For this reason, JB Hi-Fi, as one of Australia's more prominent retail chains, could be well-positioned to see a strong share price performance in 2023.

In addition to selling home entertainment and electronics goods through its self-branded stores, JB Hi-Fi also sells home appliances via the Good Guys brand of retail outlets.

JB Hi-Fi could also present a solid buy-the-dip opportunity, given its share price fell 13.2% in 2022, while its price-to-earnings ratio has recently hovered beneath 10.

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