The first trading day in June saw the market sold off again with 19 constituents of the ASX 300 hitting 52-week lows. There were a number of resource related companies which continue to suffer from the fall-out of lower commodity prices, including the once-popular Tap Oil (ASX: TAP) and mining services outfit Transfield Services (ASX: TSE).
While there are no doubt some bargains in the mining and mining services sectors, these bargains are lurking in a minefield of danger. For Foolish investors, there is no need to head into the 'danger zone' when there are lower risk, yet enticing opportunities elsewhere. The recent volatility has potentially created the opportunity to purchase shares in companies which are not only more attractively priced than they were just a few days or weeks ago but that also possess strong balance sheets and positive outlooks.
For starters, investors may want to take a look at the following three stocks that hit 52-week lows yesterday.
Hearing implant innovator Cochlear (ASX: COH) plunged over 18% to a one-year low after downgrading its profit for the current financial year. There was little in the announcement to suggest that the long-term outlook has changed and the company still manufacturers a world-renowned leading product.
GUD \ (ASX: GUD) owns a number of branded goods, including Sunbeam and Davey. It should be noted that the company has benefitted from a strong Australian dollar (AUD) as it imports most of its goods. Balancing the head wind of a weakening AUD is the potential for a rebound in consumer confidence. GUD is also forecast to pay a dividend of 76 cents for FY13, placing the stock on an attractive 7.9% yield.
Silex Systems (ASX: SLX) is a high-tech company working in the fields of semiconductors, photonics and nuclear energy technologies. The company has an array of intellectual property that could prove game changing to the company in the future.
Foolish takeaway
As Motley Fool Investment Analyst Scott Phillips likes to say, "make volatility your friend". It's wise advice and is an important attribute for long-term investors to understand and conquer.
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Motley Fool contributor Tim McArthur does not own shares in any of the companies mentioned in this article.
