It’s the time of year when investors begin to look ahead to next year and attempt to find the stocks that could provide their portfolios with a boost moving forward.
Of course, with the ASX having disappointed in 2014, expectations may not be quite as high as they were a year ago, when the ASX was riding high on gains of over 15% for the year.
However, there are still a number of top quality ASX stocks that could deliver superb gains next year. Here are three that could turn out to be the best performers in 2015.
One stock that has had a great 2014 is Amcor Limited (ASX: AMC), with shares in the packaging company rising by 13% year-to-date. There could be more to come, though, since Amcor is planning on engaging in M&A activity moving forward, with a particular focus on growth markets across the globe having the potential to push its bottom line northwards over the medium term.
As well as offering bright future growth prospects, shares in Amcor also come with an excellent track record of dividend growth, with dividends per share having risen at an annualised rate of 8.1% over the last five years. This means that Amcor’s current 3.7% yield is viewed by investors as having the potential to grow at a brisk pace over the medium to long term which, alongside the company’s upbeat earnings growth prospects, could push the share price higher in 2015.
Although the likes of Aldi and Costco have the potential to disrupt the status quo in the Australian supermarket industry, Wesfarmers Ltd (ASX: WES) has disruption plans of its own. Indeed, it is apparently aiming to follow UK supermarket-giant Tesco to move more heavily into financial services, which could prove to be a growth area for the business moving forward.
That’s because, as Tesco has shown, doing so can provide an excellent cross-selling opportunity with regard to existing grocery customers. Furthermore, with interest rates set to remain low through 2015, demand for new loans may rise – especially if the Aussie property market fails to significantly cool down.
With Wesfarmers having a price to sales ratio of just 0.8, it seems to offer good value, while a fully franked yield of 4.7% should mean that demand from investors remains buoyant throughout 2015.
Commonwealth Bank of Australia
Having outperformed the ASX in 2014 (up 3% versus a flat ASX), Australia’s largest bank, Commonwealth Bank of Australia (ASX: CBA), could continue this run in 2015. That’s because low interest rates suit the bank and, perhaps more importantly, are beneficial for its investors, too.
Indeed, CBA has benefitted from low rates through increased demand for new loans, as well as fewer bad loans, in recent years. With the RBA set to maintain a loose monetary environment, this trend could continue, while a fully franked yield of 5.1% could mean that shares remain in-demand from yield-hungry investors.
In addition, with shares in CBA trading on a P/E ratio of 14.8 (versus 15.2 for the ASX) they don’t appear to be vastly overvalued and could offer an impressive total return in 2015.
So, with 2015 appearing to be a year full of potential for Amcor, Wesfarmers and CBA, now could be a good time to buy shares in all three companies. However, there is another ASX stock that is worth taking a look at first.
That’s because it’s recently been named as The Motley Fool’s Top Stock For 2015 as a result of its superb growth potential and stunningly low valuation. As a result, it could boost your returns next year and help make 2015 and beyond a more prosperous period for your investments.
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Motley Fool contributor Peter Stephens does not own shares in any of the companies mentioned.