All companies have their ups-and-downs, it’s part of the fun of investing. But sometimes the market discounts well run companies which have great long-term growth prospects, creating a golden buying opportunity.
Here are three strong companies which fell last month that could be worth buying in May.
Cooper Basin energy producer Senex Energy Limited (ASX: SXY) lost 13% of its value in April despite releasing a positive quarterly report. Investors were unimpressed that oil production had not grown in the quarter, despite sales revenue jumping by a massive 16.2% over the same period last year.
Given Senex’s long-term prospects to find and develop oil and gas, and the significant farm-in agreement with Origin Energy Limited (ASX: ORG), this feels like an oversight to me. On top of this, Senex reported it has already achieved rapid oil production increases in the fourth quarter.
Property developer Cedar Woods Properties Limited (ASX: CWP) also fell back in April by just under 6%. The company now trades at just 13 times earnings and at this price there is a strong case for adding the company to a long-term portfolio.
Cedar Woods Properties has a proven track record of solid earnings growth and has produced a five-year total shareholder return of 57.1% per year. Revenue in the first half of 2014 jumped 39% and the company has a positive outlook for the second half and anticipates a record profit.
A 15% fall in the share price of casino resort operator Donaco International Limited (ASX: DNA) has put the company on my radar after a strong run-up over February and March. The company can be picked up today for $1.22 per share, which given Donaco’s significant growth trajectory could turn out to be a long-term bargain.
The growth prospects for Senex Energy and Donaco International mean the two companies would fit well in a growing, risk tolerant portfolio, while dividend-paying Cedar Woods Properties offers the cash return of a growing blue-chip company.
The weakened share price of all three companies offers a great opportunity to add them to your portfolio today.