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Will these 4 stocks bounce back in 2014?

It’s been a tough year for many companies listed on the stock market, particularly those exposed to the resource sector, although many companies exposed to other sectors have been finding business conditions tough as well.

In the last week the following five stocks have all hit new 52-week lows, which certainly isn’t a reason to buy them, however it can be a good place to search for undervalued opportunities.

Qantas (ASX: QAN) recently touched 97 cents, which is not only a one-year low but also near its decade low. There are a number of moving parts to understanding the issues facing Qantas and while some of the restructuring and cost-cutting initiatives could help improve the company’s outlook for next year, Warren Buffett’s age old advice to avoid airline stocks would appear to be the safest course of action for most investors.

Imdex (ASX: IMD) is exposed to the mining and oil and gas industries through the range of drilling related products it manufactures, rents and sells. The stock recently hit 45 cents, a low for the year and also a price the stock last traded at in 2009. While there is no doubt that demand for its products has cooled, Imdex’s global sales force and exposure to the oil and gas sectors could make this one for the watch list in 2014.

Incitec Pivot (ASX: IPL) is also heavily exposed to the resources sector via its wholly owned Dyno Nobel explosives business. Like Imdex, Incitec Pivot also has a weakened outlook due to the cooling mining boom. Some analysts however believe production volumes will continue to rise, which will support demand for explosives.

Incitec is also a major manufacturer, trader and distributor of fertilisers. With the potential for Australia to position itself as ‘Asia’s food bowl’, Incitec’s market share of fertiliser supply is appealing.  Given the renewed interest by investors in agricultural stocks, this could play to Incitec Pivot’s advantage as we enter 2014.

Ausenco’s (ASX: AAX) share price dived to 57 cents last week taking the stock to not just a new 52-week low but also a new 10-year low. While the engineering company is exposed to the mining sector, it also operates across the infrastructure and civil sectors and is diversified by region with operations around the globe. While competition is likely to remain fierce for engineering contractors, if the forward order book remains strong for Ausenco, the market may look more favourably on Ausenco in 2014.

Foolish takeaway

With many companies soon to be ruling off their interim results for the December half year and then reporting those results in February, now is the time for investors to be positioning their portfolios for early 2014.

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Motley Fool contributor Tim McArthur does not own shares in any of the companies mentioned in this article.

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