"Be fearful when others are greedy, and greedy when others are fearful."
No doubt you've read that one before.
It's one of Warren Buffett's most famous and oft-quoted lines, and it's one that I've seen used by the financial media countless times over the last few weeks during the market's severe turbulence.
Warren Buffett is arguably the greatest investor of all time, and it's not likely that anyone will go on to match his level of success in the future.
Yet, while we all yearn to learn from the master himself, very few of us can find the courage, or the discipline, to follow that one piece of advice that has played such a huge role in shaping his success over the last five decades.
"Be fearful when others are greedy, and greedy when others are fearful."
In theory, no one wants to buy shares at the peak of a bull market, yet most investors still do for the fear of missing out. Likewise, no one wants to miss a bargain when shares are at their lowest, yet so many are too scared to act when the time is right.
Indeed, it is so much easier to say you'll be greedy when the market sinks than it is to actually follow through and buy.
In August, the S&P/ASX 200 (Index: ^AXJO) (ASX: XJO) suffered its worst month since the Global Financial Crisis, crashing 8.6%. At 5101 points, it's also down nearly 15% since it peaked near the 6000 mark in March this year.
As scary as it may be, now is the time to buy.
Ok, it would be unwise to throw all of your cash into shares considering the market could have further to fall – there's no way of predicting the bottom and you should always have some cash at the ready.
But at the same time, investors who do take that leap of faith – to be 'greedy when others are fearful' – stand to be well-rewarded over time.
With that in mind, here are five ASX companies I believe are presenting as great buys today.
5 ASX stocks to buy right now
- XERO FPO NZ (ASX: XRO) is a New Zealand-based accounting software company that is taking the world by storm. However, the share price certainly doesn't reflect its rapid growth, nor its blue-sky potential, having lost more than half its market value over the last six months. Although the company is not yet profitable, it is investing heavily into marketing and development which should bode well for those investors in it for the long haul.
- Veda Group Ltd (ASX: VED) has retreated 9% over the last week or so, despite reporting a fairly impressive full-year earnings result (and forecasting double-digit growth for FY16). As a data analytics business, Veda's revenue streams are somewhat defensive and should remain relatively stable even if the economy does continue to weaken. The shares currently trade for $2.09, down from $2.30 last week.
- Senetas Corporation Limited (ASX: SEN) could also be worth a look for investors willing to take on a little extra risk. The company provides high-speed data encryption hardware designed to protect data travelling between sites. The company has generated strong sales growth which is tipped to continue into the future, while its shares are now 30% cheaper than they were three weeks ago at 15 cents each.
- Collection House Limited (ASX: CLH) is involved in the receivables management business, or debt collection to you and me. Collection House has a strong track record for revenue and earnings growth, yet remains under-appreciated by the broader market (with a forward price/earnings ratio of just 12!). Better yet, it offers a juicy, 3.9% fully franked dividend yield.
- Woolworths Limited (ASX: WOW) has had a dreadful run, and its earnings are expected to take another hit in the current financial year as a result of tough competition and falling margins. With a new management team at the helm, I believe now could be a reasonable time for long-term investors to build a position. At $25.53 per share, the stock trades on a 5.4% fully franked dividend yield.
Right now, companies offering solid, fully franked dividend yields are particularly appealing. Not only are interest rates sitting at just 2%, the market is pricing in a 91% chance of another interest rate cut before the end of the year, according to The Australian Financial Review, which could lead to stronger demand for companies like Collection House and Woolworths.
