There is no doubt that 2016 has been tough for investors who have been underweight the resources and mining sectors.
In fact, the S&P/ASX 200 Materials (Index: ^AXJO) (ASX:XMJ) index has gained around 38% for the year-to-date, compared to just 3% for the ALL ORDINARIES (Index: ^AXAO) (ASX: XAO).
Despite this, I think some of the best opportunities for gains over the next year or so will come from shares that have been beaten up by an impatient market.
With that in mind, here are three shares that I think are bargains right now:
Servcorp Limited (ASX: SRV)
Servcorp operates managed office spaces in some of the most high profile office blocks in the world. As the chart below highlights, the company has been a consistent performer and expects to deliver another year of double-digit earnings growth over the course of FY17.
Servcorp is currently debt free and offers investors a healthy dividend yield of around 3%.
One point investors should note, however, is that the shares are quite illiquid and this means the share price can be very volatile at times.
Sirtex Medical Limited (ASX: SRX)
At $26 per share, I think Sirtex could be one of the best value healthcare stocks on the ASX at the moment.
If analyst forecasts for FY17 are correct, the biotechnology company is currently trading on a forward price-to-earnings ratio of just 21 – well below its historical average.
It appears the market is heavily discounting the prospects of the company and perhaps focusing too much on some of the shorter-term challenges it currently faces including increasing investments in marketing and sales.
Nonetheless, I think risk tolerant investors could do far worse than take a closer look at Sirtex at current levels, especially when you think about the size of the company's potential target market.
IPH Ltd (ASX: IPH)
Shares of IPH have been whacked pretty hard over the last few weeks, losing around 20% since the start of November.
It comes after 30 million shares were released from escrow as part of a previous acquisition, with another 37 million shares to remain in escrow until the company releases its first half results in February.
While this overhang is likely to keep a lid on the share price in the short term, I think IPH's underlying business is performing quite well and this presents a decent buying opportunity for patient investors.
The company expects to deliver EBITDA growth of around 12% over the course of FY17 and investors should be provided with an attractive dividend yield of around 4.8%.
