So far in 2015 Mr Market hasn't given savvy investors too many solid buying opportunities at the top end of town – in the S&P/ASX 100 (Index: ^AXTO) (ASX: XTO) that is.
However, with today's selloff included, a 2.5% fall in the Australian share market over the past month could now be creating some solid buying opportunities for savvy investors.
Coca-Cola Amatil Ltd (ASX: CCL), Medibank Private Ltd (ASX: MPL) and Insurance Australia Group Ltd (ASX: IAG) are three stocks likely to be in the crosshairs of many investors.
Here's what you need to know about each…
Coca-Cola Amatil
CCA has handily outperformed the market in 2015. Indeed it appears investors have grown more enthusiastic about the turnaround strategy of Australia's exclusive distributor of Coca-Cola and Beam branded beverages. Since being sold down in 2013 and again in 2014, the company's new CEO, Alison Watkins, has overseen the refreshment of its marketing campaign, new product launches and a $US500 million cash injection from parent, The Coca-Cola Company. With a 4% partially franked dividend, it's worthy of a second look.
Medibank Private Ltd
Shares in the hottest initial public offering (IPO) of 2014, Medibank Private Ltd, have begun to come back to earth after soaring to over $2.50 in early 2015. But it now appears myopic investor enthusiasm is waning. However, even at its current price of $2.21 per share, Medibank shares do not appear to be a bargain. Despite boasting a 3.8% dividend yield, investors are advised to hold-off buying, until prices trade considerably below $2.00.
Insurance Australia Group
The owner of CGU, NRMA, SGIO and other insurance brands has seen its share price sold down 6% in 2015. Natural weather events along the eastern seaboard of Australia may have contributed to IAG's price falls. The trick to investing in insurance stocks is to take a long-term view and buy them when they've had an 'off year'. So until we see IAG's share price trend meaningfully back towards parity with book value (it's currently trading at 2.1 times its net assets), I think it deserves a hold rating.
Should you buy Coca-Cola Amatil Ltd?
