As investors, we're always looking for the perfect stock. You know the one; stunning growth potential, an excellent dividend and a super-low price that screams 'value for money'.
In reality, though, that stock rarely exists and, if it does, the efficient nature of the markets means that its share price usually increases in price before most investors catch on.
However, this doesn't mean that there is a lack of stocks available that are excellent propositions, and which could deliver superb returns over the long run. Sure, they may not be perfect, but they could significantly boost your portfolio. With that in mind, here are three stocks that are set to provide a fantastic total return over the long run.
Ramsay Health Care Limited
The major drawback to Ramsay Health Care Limited (ASX: RHC) is its disappointing yield. In fact, the private hospital operator currently yields just 1.4%, although the main reason for that is its superb share price growth, with Ramsay having risen by 372% in the last five years.
Certainly, dividends have grown at a rapid rate in recent years and are up 17.5% per annum during the last five years. And, with dividends forecast to rise by 17% in each of the next two years, Ramsay could become a much more appealing income stock moving forward.
Of course, it already has excellent growth prospects, with the company's bottom line set to rise by 19.7% per annum in the next two years, as growth in China and Europe is due to be aided by a weaker Aussie dollar. Furthermore, Ramsay trades on a price to earnings growth (PEG) ratio of just 1.66, versus 2.35 for the ASX.
Coca-Cola Amatil Ltd
Following a challenging period where profits have fallen at an annualised rate of 4% in the last five years, things are finally on the up for Coca-Cola Amatil Ltd (ASX: CCL). Of course, its turnaround plan is unlikely to be smooth sailing, but with cost cutting initiatives being successful thus far and a renewed marketing campaign, Coca-Cola Amatil is forecast to post earnings growth of 5.4% per annum during the next two years.
In addition, it also offers a partially franked yield of 4% and, with it having a decent track record of dividend per share growth (they have risen by 3.2% per annum during the last 10 years), its current price to sales (P/S) ratio of 1.58 compares favourably to the ASX's P/S ratio of 1.62.
Furthermore, with a beta of just 0.56, Coca-Cola Amatil also offers a less volatile shareholder experience than the ASX, which could be a major plus if the Aussie economy fails to respond as positively to interest rate cuts as is being priced in.
Newcrest Mining Limited
While much of the mining sector is struggling to post any kind of earnings growth, Newcrest Mining Limited (ASX: NCM) is set to grow its bottom line at an annualised rate of 37.4% over the next two years. This, of course, is largely because the outlook for the gold price is much more positive than for oil or iron ore, however Newcrest has endured a challenging period during which it cut costs and improved efficiencies and that process is undoubtedly helping its bottom line right now.
And, while Newcrest is not expected to pay any dividends during the next two years, it trades on a PEG ratio of just 0.64, which is far lower than the wider materials sector's PEG ratio of 1.2.
