The Australian share market has shown strong signs of life over the last 10 days. Following on from a rather lacklustre start to the year, the S&P/ASX 200 (Index: ^AXJO) (ASX: XJO) has managed to rise 5.2% since January 16 on the back of strong international leads and further global economic stimulus.
Despite that strength however, there are mixed views regarding how the local market will perform for the remainder of the year. While an interest rate reduction could spur the ASX 200 higher, a slowing economy and the commodities crisis could significantly hinder its progression, resulting in potentially woeful returns for the majority of investors.
To perform well in 2015, there is little doubt that investors will need to be on their A-game. Rather than following the investing crowd into potentially overpriced stocks, individuals will need to select their investments wisely. With that in mind, here are 10 stocks which I believe could perform well this year.
- Veda Group Ltd (ASX: VED). The data analytics business should thrive in the coming years with credit reporting standards becoming increasingly strict – particularly with uncertainty seeping back into the market. With an enviable track record for revenue and earnings growth, I expect that trend to continue in 2015 and beyond.
- Greencross Limited (ASX: GXL). The veterinary services provider endured a rough patch in 2014 yet its growth potential remains well and truly intact. While it currently controls 7.5% of the local market, it will continue to expand its number of vet clinics and retail outlets with the goal of 20% market dominance.
- Lindsay Australia Limited (ASX: LAU). The transport and logistics company should not only benefit from cheaper fuel, but also from the increasing demand for the refrigerated transportation of seafood to Asia. While it remains a risky bet, it's got the support of companies like Washington H. Soul Pattinson and Co. Ltd (ASX: SOL) and Orora Ltd (ASX: ORA), both of which are major shareholders.
- Woolworths Limited (ASX: WOW). The supermarket behemoth has fallen out of favour with the market, making it a very appealing long-term prospect. While it has consistently grown revenues and earnings, it also offers a compelling 4.5% dividend yield, fully franked.
- Cover-More Group Ltd (ASX: CVO). Despite its strong growth prospects as Australia's largest travel insurer, the stock has trended lower with some fearing a decline in Australian outbound travel. That fear presents long-term investors a prime opportunity to invest in a high quality business.
- Japara Healthcare Ltd (ASX: JHC). Shares of the recently-listed aged care provider are trading near an all-time low after the company reported a payroll blunder in December last year. While it was certainly disappointing, the underlying business remains strong while the company should benefit over the ultra-long term from Australia's rapidly ageing population.
- Sonic Healthcare Limited (ASX: SHL). Another company that will benefit from a growing and ageing population is Sonic Healthcare. The healthcare company will also continue to expand overseas which should help drive revenue and earnings growth for years to come.
- Collection House Limited (ASX: CLH). In addition to strong growth potential, the debt collection business also offers a compelling dividend yield. In the 2015 financial year it's expected to yield around 4.2%, fully franked.
- Shine Corporate Ltd (ASX: SHJ). The plaintiff litigation company is expanding its geographical reach across Australia whilst also widening its area of expertise. With a strong management team, Shine is well placed to deliver fantastic returns in 2015 and beyond.
- Coca-Cola Amatil Ltd (ASX: CCL). The beverage manufacturer had a disastrous run over the last two years and while the company isn't out of the woods yet, it certainly seems to be making the right moves to turn the ship around. While it's hovering around it's lowest price in five years, now could be an excellent time to buy.
There's one more company which could deliver even greater returns in 2015 and in the years to follow.
