2014 was a rather disappointing year for Australian investors. While equity markets around the world have rallied to never-before-seen heights, the S&P/ASX 200 (Index: ^AXJO) (ASX: XJO) has moved sideways, rising just 0.8% in a rather volatile display.
Looking ahead, 2015 could be a far greater year – particularly if the Reserve Bank does in fact reduce interest rates lower, as many analysts are now expecting. With term deposits and bonds therefore set to deliver even lower returns, the stock market truly will be the best place to put your hard earned to work.
If you're looking to make some money in the New Year, these 10 companies could be the perfect place to start.
Income
In a low interest rate environment, some of the greatest gains could come from dividends.
1. Coca-Cola Amatil Ltd (ASX: CCL): At $9.16, the beverage giant looks an excellent buy. The company looks set to right the wrongs of 2013-14 and could deliver decent capital gains, in addition to its forecast 4.4% dividend yield, franked to 75%.
2. Insurance Australia Group Ltd (ASX: IAG): If the Reserve Bank does cut rates any further, you can expect investors to flock towards the highest yielding stocks. IAG is tipped to yield 6.1% fully franked, which equates to an 8.7% grossed up yield.
3. Woolworths Limited (ASX: WOW): The supermarket behemoth has been sold off heavily this year, giving long-term investors the perfect opportunity to start a position. At $30.50, it trades at a 20% discount to its 52-week high while it offers a 4.8% dividend yield, fully franked.
4. JB Hi-Fi Limited (ASX: JBH): The specialty electronics retailer has been sold off with consumer confidence remaining shaky. However, lower interest rates would likely boost sales as well as the share price. When combined with a forecast 5.5% fully franked dividend, JB Hi-Fi could be the recipe for great returns.
Growth
These well established companies could deliver fantastic capital gains.
5. Veda Group Ltd (ASX: VED): The data analytics business could be in for another big year after the shares rose nearly 18% in 2014. Credit reporting standards are becoming increasingly strict and, while it enjoys a monopolistic position in the Australian market, Veda and its shareholders should benefit greatly.
6. Greencross Limited (ASX: GXL): Although the provider of veterinary services is still on track to meet earnings guidance, investors have sold the shares off, giving prospective investors the perfect opportunity to buy. The shares are now trading at $7.75, a 28% discount compared to their price in August.
7. Collection House Limited (ASX: CLH): The debt collection agency has built a strong track record for revenue and earnings growth and FY15 should be no different. The company is in the process of relocating into a much larger office to allow it to continue expanding over the coming years. I recently purchased my second parcel of shares in this promising company.
8. Shine Corporate Ltd (ASX: SHJ): The plaintiff litigation firm, which has traditionally focused on personal injury cases, is expanding across Australia and into new practice areas. With a strong management team and a disciplined approach to business, Shine Corporate shows a lot of promise for the years to come.
Small Caps
These smaller, more speculative plays could deliver enormous returns, although they carry a higher element of risk.
9. Nearmap Ltd (ASX: NEA): A provider of geospatial mapping technology has grown strongly in Australia and is taking its products to the much larger US market. While profits may be impacted in the near-term as a result of the expansion, the long-term is looking as promising as ever before.
10. Lindsay Australia Limited (ASX: LAU): The transport and logistics business is held by some big-name Australian corporations, including Washington H. Soul Pattinson and Co. Ltd (ASX: SOL) and Orora Ltd (ASX: ORA), and for good reason. It is expanding into far north Queensland where there is huge potential for refrigerated seafood transport into the Asian markets.
There is one more company which could be an even greater buy than any of those companies mentioned above.
NEW: The Motley Fool's #1 stock for 2015 – Yours FREE!
