2014 has been a disappointment for most Aussie investors, with the ASX now up just 1.75% since the turn of the year. However, for holders of Crown Resorts Ltd (ASX: CWN) and Fortescue Metals Group Limited (ASX: FMG), 2014 has been much worse since shares in the two companies have fallen by 13% and 30% respectively.
Despite this, both companies have the potential to deliver stunning returns moving forward. Another company, Amcor Limited (ASX: AMC), which is up an impressive 6% year-to-date could also be worth buying. Here's why.
Crown Resorts Ltd
It's a time of change for Crown Resorts as the business seeks improved profitability through a number of new projects. These include a joint venture in Asia, as well as plans for hotels/casinos in Sydney and Las Vegas. As a result, earnings are expected to increase at an annualised rate of 10.5% over the next two years.
This shows that while shares in Crown Resorts have disappointed so far this year, the company has the potential to deliver strong growth numbers moving forward. With shares in the company trading on a price to earnings growth (PEG) ratio of just 1.57, they seem to offer growth at a reasonable price.
Fortescue Metals Group Limited
Earnings at Fortescue are set to fall by 43% between FY 2014 and FY 2016 as a lower iron ore price hits the company's bottom line.
However, for new investors, this presents as an opportunity. That's because shares in the company currently offer a fat, fully franked yield of 5.3%, with dividends per share being extremely well covered at over 2.5 times. Furthermore, after a tough period, shares in Fortescue now trade on a P/E ratio of 7.6 times FY 2016's projected earnings and look like a steal.
Amcor Limited
Packaging business Amcor has historically delivered a relatively reliable earnings growth rate of 8.4% per annum over the last 10 years. With a number of acquisitions and the potential to grow in emerging markets, it could continue to post strong numbers over the long term.
Although shares in Amcor are not dirt cheap, there is some potential for an upward rating adjustment since the P/E ratio is currently 14.9 (versus 15.6 for the ASX). With shares yielding 3.9% (unfranked), there is a strong income return on offer, too.