The Australian stock market had a rocky start to the new year, with the bourse falling for the third consecutive week following indications that China's manufacturing sector had shrunk for the first time in six months.
The S&P/ASX 200 (Index: ^AXJO) (ASX: XJO) lost 1.2% for the week and is down 2.1% for the month so far. The losses have been widespread, with the major banks; namely Commonwealth Bank of Australia (ASX: CBA), Westpac Banking Corp (ASX: WBC), Australia and New Zealand Banking Group (ASX: ANZ) and National Australia Bank Ltd. (ASX: NAB), each down between 2.9% and 4.9%, while other blue chips such as BHP Billiton Limited (ASX: BHP) and Westfield Group (ASX: WDC) are also down for the year.
While it is painful to watch the value of our stock holdings diminish, it also creates an opportunity for investors to buy stocks at discounted prices which, if held onto for the long-term, could deliver enormous returns. Here are three companies investors could consider adding to their portfolio today:
Telstra Corporation Ltd (ASX: TLS): The telecommunications behemoth needs no introduction. While shares have rallied strongly for the past three years, there is plenty of room left to run as it tightens its grasp over the telecommunications industry. Its shares have fallen away from $5.30 to $5.15, making today a good time to buy shares on the cheap. Its 5.5% fully franked dividend yield is the icing on the cake.
NIB Holdings Limited (ASX: NHF): The private health insurance provider was showing signs of rallying after it announced it was increasing its premiums by an average of 7.99% across each of its products. Shares hit a new all-time high of $2.73 but have since fallen back to $2.55. Morningstar has predicted earnings per share (EPS) growth of 20% in 2014, as well as a 10% increase in dividends. The company is set to benefit from a low interest-rate environment, population growth and mounting concerns regarding the public hospital system.
Nearmap Ltd (ASX: NEA): The mapping business soared in 2013, delivering a gain of over 700%! Despite that jump, I believe there is still further to climb as the company signs up more and more customers, providing them with the most up-to-date maps and photos. The company recently signed a licensing agreement for Google Maps, which will give Nearmap's customers greater geographical coverage and better tools to view maps. After hitting a high of 68c per share late last year, shares are currently trading at 63.5c.
