Are these beaten up blue-chips in the bargain bin?

The Coca-Cola Amatil Ltd (ASX:CCL) share price is one of three that have fallen hard in recent times. Does this make them bargain buys?

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The S&P/ASX 200 (Index: ^AXJO) (ASX: XJO) has performed well this year and is just a fraction away from breaking through the 6,000 points mark.

Unfortunately not all shares on the index have performed so well. In fact, the three blue-chips listed below have had a terrible time of late. Does this make them bargain buys?

The Coca-Cola Amatil Ltd (ASX: CCL) share price tumbled 13% in April after the beverage company downgraded its full-year guidance on the back of difficult trading conditions in its Australian beverages division. Although one broker thinks this is just a temporary headwind and expects things to improve, at around 18x underlying earnings I see little value in owning its shares today. I would suggest investors wait for its shares to fall to a level befitting the company's current growth profile.

The Fortescue Metals Group Limited (ASX: FMG) share price has fallen 23% in the last three months after the iron ore price fell back down to Earth. Whilst I think that Fortescue Metals is one of the best options in the resources sector, I still believe that the iron ore price has further to fall. This could drag Fortescue's share price down along with it. In light of this I feel investors should hold off making an investment at this point.

The Telstra Corporation Ltd (ASX: TLS) share price has dropped 16.5% so far this year. Concerns over the impact the NBN and the new TPG Telecom Ltd (ASX: TPM) mobile network will have on its business are largely behind the decline. While these are valid concerns, I still feel that market has overreacted somewhat. So with its shares providing a trailing fully franked 7.3% dividend, I think Telstra could offer investors a compelling risk/reward.

The Motley Fool Australia's parent company Motley Fool Holdings Inc. owns shares of Telstra Limited. Motley Fool contributor James Mickleboro has no position in any stocks mentioned. The Motley Fool Australia owns shares of TPG Telecom Limited. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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