We asked our contributors to pick their favorite ASX stocks to buy in June. Here are their top ideas.
Tom Richardson: Flight Centre Travel Group (ASX: FLT)
The travel retailer looks a good bet to deliver more growth over long-term horizons. Founder Graham Turner has pioneered a successful bricks-and-mortar business model alongside an online offering. I wouldn't bet against him taking the business higher, with growth in the global corporate and retail travel markets available.
Selling for around 18 times 2014's forecast earnings, it looks a good bet for anyone seeking leverage to the growth in global travel over time.
Motley Fool contributor Tom Richardson owns shares in Flight Centre.
Tim McArthur: IOOF Holdings Limited (ASX: IFL)
Diversified financial services company IOOF has been in the business of helping Australians build their wealth since 1846. Today, IOOF helps its customers through the provision of a range of services including financial advice, funds management through its Perennial-branded business unit, estate planning and trustee services.
Like many companies in the financial sector, IOOF is enjoying the tailwind of both a growing per capita income and a growing stream of superannuation money. IOOF has also benefited from the successful integration of numerous bolt-on acquisitions. The recently announced agreement to merge with SFG AUST FPO (ASX: AFW) would add $13.7 billion in funds under advice to the enlarged group.
Given IOOF's track record, a successful merger with SFG could add meaningful value to shareholders via increased scale and synergies.
Motley Fool contributor Tim McArthur does not own shares in any of the companies mentioned in this article.
Ryan Newman: Veda Group Ltd (ASX: VED)
Interest rates look set to remain unchanged for some time yet, which indicates that credit growth will continue to increase throughout Australia. The Global Financial Crisis showed us the importance of lending only to those customers who are able to repay their debts, and that's where Veda Group comes in.
The data analytics company allows businesses to assess their prospective clients' credit risks while also allowing individuals perform tenancy checks and to assess the history of used cars. With a strong track record for increasing revenue and earnings, Veda looks a solid buy (especially with its shares down 11.4% since late March).
Motley Fool contributor Ryan Newman does not own shares in any of the companies mentioned.
Chris Koenig: Nick Scali (ASX: NCK)
Nick Scali is a furniture retailer operating primarily on the east coast of Australia. The company operates two brands: Nick Scali and Sofas2Go. Also, the company has secured the Australasian rights for the premium Italian retail brand Chateau d'Ax, aimed at the top end of the market. Recovery in the economy, especially the housing market, can be indicated by increasing furniture sales for new and existing homes and offices.
This company has a sound balance sheet and a very high return on equity last year of 44%. The dividend is yielding 4.7% fully franked and is expected to grow steadily. In recent years, many retailers have struggled to improve sales and earnings. This is one retailer that has bucked the trend, and I expect will continue to outperform the sector for many years into the future.
Motley Fool contributor Chris Koenig does not own shares in Nick Scali.
Owen Raskiewicz: Vita Life Sciences (ASX: VSC)
Vita Life is a pharmaceuticals company that supplies vitamins and supplements to Australian and Asian markets. It has manufacturers in the U.S., Australia, and New Zealand, which produce bulk products to be shipped to facilities in Sydney, Singapore or Malaysia. Between 2011 and 2013, revenues grew 45% and net profit jumped 290%.
Management have set guidance of between 13% and 15% revenue growth in 2014 and an EBIT margin of around 15%. It has a return on equity of nearly 30% and Asian sales account for 60% of group revenue. In addition it maintains a robust balance sheet.
Motley Fool contributor Owen Raskiewicz does not own shares in this company.
Peter Andersen: XRF Scientific Limited (ASX: XRF)
This little company is a global leader in the highly specialised field of XRF fusion related technology, labware and chemicals. At present, its main expertise is in mineral analysis.
With the recent release of the flagship xrFuse6 Next Generation instrument, XRF is well placed to capitalise on the production side of mineral resources. The acquisition of Kitco Labware (Canada) and the joint venture with New Zealand-based Rocklabs (automated laboratory processes) opens further growth opportunities for this progressive company. In addition, potential deals are being evaluated in Brazil and Russia.
With a strong balance sheet, no debt, and a projected 5% dividend, XRF Scientific is suitable for the longer term investor.
Motley Fool contributor Peter Andersen owns shares in XRF Scientific.
Andrew Mudie: OzForex Group Ltd (ASX: OFX)
My top stock idea for June is OzForex Group Ltd. OzForex was sold off by around 25% over two days in late May when the company reported its first full-year results as a listed company. The company listed in October last year and quickly rose from the $2 offer price to $2.50. It hit a high of $3.50 in March but has now fallen back to around $2.60 after investors were disappointed in the number of active users.
User numbers were down 2% from the IPO forecast while most other metrics were beaten by 5% or more. I view the company as a good long-term opportunity due to its high growth and disruptive nature, and take comfort from investors willing to pay a similar price in October for the company.
In my view the outlook has not changed enough to account for the severe price drop.
Motley Fool contributor Andrew Mudie owns shares in OFX.
