It may not feel like it, but the present time could prove to be an opportune moment to buy shares in top quality ASX-listed companies.
Certainly, the wider index could move lower. After all, the global economy continues to experience a highly uncertain period. But, through purchasing slices of top notch companies when their prices are relatively attractive, you could be setting yourself up for impressive returns over the next handful of years.
With this in mind, here are three companies that could prove to be profitable long term buys.
Australia and New Zealand Banking Group
Bank shares have been kicked recently and Australia and New Zealand Banking Group (ASX: ANZ) is no different. Shares in the highly diversified banking group are down 5% in the last three months but, with a P/E ratio of 12.5, they could be worth buying for the long term.
Indeed, a rerating could be on the cards, since ANZ's P/E ratio is considerably lower than that of the ASX, which has a P/E ratio of 14.9. The potential is complemented by a fat, fully franked yield of 5.4% and, with dividends per share forecast to rise by 6.4% per annum over the next two years, ANZ could prove to be a strong financial play over the long run.
Wesfarmers Ltd
It's not just bank shares that have been hit hard of late. Aussie conglomerate, Wesfarmers Ltd (ASX: WES) has seen its share price fall by 4% in the last three months alone but, despite this, it still trades on a mega-rich P/E ratio of 20.3.
While considerably higher than the ASX's P/E ratio of 14.9, Wesfarmers offers substantial growth potential. Indeed, interest rates of just 2.5% (which could move even lower) mean that Wesfarmers' generous yield remains attractive. Wesfarmers is also expected to increase its bottom line at an annualised rate of 12.8% over the next two years.
Such a strong growth rate seems to justify the company's current rating and could help to push its shares higher over the next few years.
Scentre Group Ltd
A low interest rate is also aiding Scentre Group Ltd (ASX: SCG), which has evolved into a number of high-profile shopping centres across Australia. Its steady earnings growth should appeal to investors, as should its 6% yield. While it's unfranked, it still works out at an inflation-beating 3.3% on an after-tax basis.
Although it has a beta of 1.3, Scentre has substantially outperformed the ASX in recent months, being up 9% versus a fall of 3% for the ASX during the last six months, for example. Now could prove to be an opportune moment to add Scentre to your portfolio.
