The first handful of trading days in 2015 have hardly inspired a large amount of confidence among Aussie investors. In fact, it seems as though the nervousness that was present in the latter part of 2014 has continued, with the ASX down 0.8% since the turn of the year.
However, just because investor sentiment is somewhat weak, it doesn't mean that now isn't a good time to be buying shares in high quality companies. In fact, there could be more value on offer right now and, with that in mind, here are three stocks that could be worth adding to your portfolio at the present time.
Ramsay Health Care Limited
The start of 2015 has seen no let-up in declining commodity prices, with oil now dipping below $50 per barrel for the first time in nearly six years. While disappointing for many companies in Australia, health care stocks such as Ramsay Health Care Limited (ASX: RHC) are little affected by it and, as evidence of this, its share price has risen by 31% in the last year.
Looking ahead, further share price rises could be on the cards for Ramsay. That's because it continues to offer significant growth potential across Europe and Asia, with its bottom line forecast to rise by 18.2% per annum over the next two years.
Certainly, a price to earnings (P/E) ratio of 31.9 appears to be rather excessive, but investors seem willing to pay more than twice the market rating (the ASX has a P/E ratio of 15) for such impressive growth potential at a time when many ASX stocks are seeing their bottom lines go into reverse. As such, now could still be a great time to buy a slice of Ramsay.
Telstra Corporation Ltd
Telstra Corporation Ltd (ASX: TLS) seems to be making excellent progress at the present time, with a revised definitive agreement being signed with NBN and the company making acquisitions in the health care space. Furthermore, Telstra continues to have considerable potential to not only dominate the Aussie mobile market, but to also expand into faster growing markets (particularly in Asia) that could make a real difference to the company's bottom line in 2015 and beyond.
In addition, Telstra continues to offer top notch income prospects. For example, it currently yields a fully franked 5% and investor sentiment in the stock could pick up if the RBA does go ahead and cut interest rates further.
Of course, should the ASX continue its fall in 2015, stocks with low betas may be well-worth holding. And, with Telstra having a beta of just 0.5, this may mean that its share price outperforms the wider market during a period of decline, with Telstra's beta indicating that it should (in theory) fall by 0.5% for every 1% fall in the ASX. As a result, it could be a sound buy at the present time.
QBE Insurance Group Ltd
It's sometimes surprising just how big an impact a new management team can make on a company. For instance, QBE Insurance Group Ltd (ASX: QBE) seems to be making impressive progress under its new CEO, John Neal, with it rationalising its offering, improving its financial standing and generating much improved bottom line forecasts.
This means that QBE can afford to increase its dividend at a rapid rate. For example, it is forecast to increase dividends per share at an annualised rate of 21.8% over the next two years and, while it currently yields a fully franked 3.4%, this could be as high as 4.8% next year.
In addition, a price to book (P/B) ratio of just 1.19 indicates that QBE offers good value for money, especially when the insurance sector has a P/B of 1.98. As such, QBE could be worth buying right now.
