3 stocks that fell in April to buy in May

A moody market and falling prices make a great time to buy for the long run.

| More on:

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

All companies have their ups-and-downs, it's part of the fun of investing. But sometimes the market discounts well run companies which have great long-term growth prospects, creating a golden buying opportunity.

Here are three strong companies which fell last month that could be worth buying in May.

Cooper Basin energy producer Senex Energy Limited (ASX: SXY) lost 13% of its value in April despite releasing a positive quarterly report. Investors were unimpressed that oil production had not grown in the quarter, despite sales revenue jumping by a massive 16.2% over the same period last year.

Given Senex's long-term prospects to find and develop oil and gas, and the significant farm-in agreement with Origin Energy Limited (ASX: ORG), this feels like an oversight to me. On top of this, Senex reported it has already achieved rapid oil production increases in the fourth quarter.

Property developer Cedar Woods Properties Limited (ASX: CWP) also fell back in April by just under 6%. The company now trades at just 13 times earnings and at this price there is a strong case for adding the company to a long-term portfolio.

Cedar Woods Properties has a proven track record of solid earnings growth and has produced a five-year total shareholder return of 57.1% per year. Revenue in the first half of 2014 jumped 39% and the company has a positive outlook for the second half and anticipates a record profit.

A 15% fall in the share price of casino resort operator Donaco International Limited (ASX: DNA) has put the company on my radar after a strong run-up over February and March. The company can be picked up today for $1.22 per share, which given Donaco's significant growth trajectory could turn out to be a long-term bargain.

Foolish takeaway

The growth prospects for Senex Energy and Donaco International mean the two companies would fit well in a growing, risk tolerant portfolio, while dividend-paying Cedar Woods Properties offers the cash return of a growing blue-chip company.

The weakened share price of all three companies offers a great opportunity to add them to your portfolio today.

Motley Fool contributor Regan Pearson owns shares in Senex Energy.

More on ⏸️ Investing

A white and black robot in the form of a human being stands in front of a green graphic holding a laptop and discussing robotics and automation ASX shares
Technology Shares

Joining the revolution: How I'd invest in ASX AI shares right now

Advances in artificial intelligence (AI) could usher in a new industrial revolution. Here’s how you can invest in it.

Read more »

Close up of baby looking puzzled
Retail Shares

What has happened to the Baby Bunting (ASX:BBN) share price this year?

It's been a volatile year so far for the Aussie nursery retailer. We take a closer look

Read more »

woman holds sign saying 'we need change' at climate change protest
ETFs

3 ASX ETFs that invest in companies fighting climate change

If you want to shift some of your investments into more ethical companies, exchange-traded funds can offer a good option

Read more »

a jewellery store attendant stands at a cabinet displaying opulent necklaces and earrings featuring diamonds and precious stones.
⏸️ Investing

The Michael Hill (ASX: MHJ) share price poised for growth

Investors will be keeping an eye on the Michael Hill International Limited (ASX: MHJ) share price today. The keen interest…

Read more »

ASX shares buy unstoppable asx share price represented by man in superman cape pointing skyward
⏸️ Investing

The Atomos (ASX:AMS) share price is up 15% in a week

The Atomos (ASX: AMS) share price has surged 15% this week. Let's look at what's ahead as the company build…

Read more »

Two people in suits arm wrestle on a black and white chess board.
Retail Shares

How does the Temple & Webster (ASX:TPW) share price stack up against Nick Scali (ASX:NCK)?

How does the Temple & Webster (ASX: TPW) share price stack up against rival furniture retailer Nick Scali Limited (ASX:…

Read more »

A medical researcher works on a bichip, indicating share price movement in ASX tech companies
Healthcare Shares

The Aroa (ASX:ARX) share price has surged 60% since its IPO

The Aroa (ASX:ARX) share price has surged 60% since the Polynovo (ASX: PNV) competitor listed on the ASX in July.…

Read more »

asx investor daydreaming about US shares
⏸️ How to Invest

How to buy US shares from Australia right now

If you have been wondering how to buy US shares from Australia to gain exposure from the highly topical market,…

Read more »