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AMP, Brambles, CSL, Origin: How will they perform in 2014?

Calendar year 2013 has been a good year for shareholders in three of the following four blue chip stocks, with Brambles (ASX: BXB), CSL (ASX: CSL) and Origin Energy (ASX: ORG) all outperforming the S&P/ASX 200 Index (Index: ^AXJO) (ASX: XJO). AMP (ASX: AMP) has been the one disappointment with its share price falling over 12% compared with the index which has risen 9.5%.

While looking back and reviewing past performance can be instructive, the question now for shareholders and investors is what will 2014 have in store for these four stocks?

In the case of AMP it’s possible that this year’s underperformance could set the stage for outperformance in 2014. A major factor in AMP’s declining share price – the stock started the year trading at around $4.80 and today is trading at around $4.20 – is the issues the insurer has faced within its wealth protection product line.

While it won’t be surprising if this division continues to cause trouble, with the stock now trading on a financial year (FY) 2014 price-to-earnings (PE) ratio of 12.5, there is scope for the share price to head higher from this point.

Meanwhile Brambles recently completed the demerger of its document handling business Recall (ASX: REC) from its pallet pooling and logistics business. The company should continue to grow earnings in FY 2014 and the separation from Recall will allow management to focus all of their attention on the pooling business. However with the stock looking around fair value the price might have a harder time outperforming the wider market next year.

CSL has been the best performing of these four stocks during 2013 with its share price up nearly 23%. With an impressive pipeline of potential products that could be rolled out in coming years, CSL should produce meaningfully higher revenues and earnings in the future. Despite this positive outlook, with the stock trading on a forecast PE multiple of 25.2 it would appear already priced for perfection.

Finally, while 2014 may be a reasonable year for Origin Energy, most investors are actually looking ahead to 2015 when the boost to earnings from the APLNG Project really begins to flow through. Looking out to FY 2015, median consensus earnings puts the stock on a forecast PE of 15.2 which looks appealing for a company of Origin’s quality and potential.

Foolish takeaway

Now is an ideal time for investors to reassess their portfolios. Investors should make adjustments where necessary, to positions which for one reason or another should either be added, removed, increased or decreased from their portfolio.

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Motley Fool contributor Tim McArthur owns shares in Origin Energy.

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