2 UK shares I’d buy now at massive discounts

Some UK shares have experienced double-digit price drops in recent months, but has this created lucrative buying opportunities for me?

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In recent months, the stock market has been quite volatile, and some UK shares have experienced significant downward momentum. But sometimes, investors get it wrong. And while it can be horrible to watch, these situations are a breeding ground for buying opportunities.

Let’s explore two businesses that have taken major hits recently and whether now is the time to buy.

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A hammered gaming studio

Shares of the UK game development and publishing group Frontier Developments (LSE:FDEV) were pulverised not too long ago. So much so that over the last 12 months, the stock is down nearly 50%. What happened?

A trading update issued in November last year was largely to blame. Following the release of the latest addition to its Jurassic World: Evolution franchise, management reported lower than expected initial post-release sales on the PC platform. At the same time, the highly anticipated Odyssey expansion to its Elite Dangerous IP has also struggled due to mediocre reviews.

Consequently, revenue guidance for its full-year results was cut, and investors had a bit of a meltdown. But was this reaction justified? I don’t think so. Frontier has a reputation for improving and adding new content to its games long after their initial release. As such, the studio has already begun addressing the concerns of gamers regarding Odyssey. Meanwhile, Jurassic World: Evolution 2 was met with critical acclaim, and Console sales are aligned with expectations making up for the disappointing PC sales.

So, is this a buying opportunity for my portfolio? I certainly think so. These issues, while concerning, appear to be short term. And with a vast line-up of new titles being released in the coming years, including Formula 1 and Warhammer, I think shares of this UK stock could be set to thrive over the long term.

UK robotics stock

2021 was a tough year for Ocado (LSE:OCDO). Despite delivering a stellar performance in 2020, shares of the UK fulfilment-automation robotics company were slashed by 36% over the last 12 months.

There are numerous catalysts behind this lacklustre performance. But it seems to have started in late 2020, when rival firm, AutoStore sued the company for patent infringement. Then later in the year, a fire broke out at Ocado’s Erith CFC facility. The disruptions caused 300,000 orders to be cancelled.

With roughly £35m of revenue lost and an ongoing legal battle, uncertainty started to brew, leading to the disappointing performance last year. But is now the time to buy?

The fire, while frustrating, is ultimately a short-term problem. Minimal damage was done to the facility, which has since been brought back to full operating capacity. Meanwhile, the lawsuit against Ocado ended in December after the judge ruled in favour of the company, dismissing all 33 claims made by AutoStore.

With the veil of uncertainty seemingly lifted, Ocado looks primed to return to full-growth mode. Having said that, the company still has plenty of competition, including AutoStore, to overcome in its expansion into the US and other European nations. Attracting and retaining clients could prove tricky if its automation technology fails to deliver higher efficiency than alternatives.

But personally, I think it’s a risk worth taking. And with the stock seemingly trading at a large discount, Ocado could be a potentially lucrative opportunity for my portfolio.

But these aren't the only buying opportunities I've spotted this week. Shares of another UK growth stock could vastly outperform both of these companies...

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Zaven Boyrazian owns Frontier Developments. The Motley Fool UK has recommended Frontier Developments and Ocado Group. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.

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