With the S&P/ASX 200 (ASX: XJO) (INDEX: ^AXJO) climbing higher now that interest rates have been cut to just 2.25%, cheap blue-chip stocks are becoming hard to find.
However, if investors are willing to look a little further down the market, to the blue chips of tomorrow there's a wealth of opportunities waiting to be scooped up.
For example, retail telecommunications company M2 Group Ltd (ASX: MTU) continues to offer both growth potential and a juicy fully franked dividend yield of 3.3%. With the owner of Dodo, Primus and Eftel trading on a P/E ratio of just 17 and dividend yield of just 3.3%, I'd gladly buy the stock today – recently I bought some for my family's portfolio (see my disclosure below)…
Another cheap long-term growth stock which savvy investors can get their hands on at a discounted rate is Challenger Ltd (ASX: CGF). The annuities provider and funds management business has rallied 3% higher over the past five days, yet it trades on a P/E ratio of just 10 and a partially franked dividend yield of 4.3%.
Despite holding the title of Australia's leading personal injury (PI) law firm, Slater & Gordon Limited (ASX: SGH) continues to grow modestly through acquisitions and organic growth. Coupled with a push into General Law – which compliments the existing PI businesses – and a very promising expansion into the larger UK market, at $6.63 per share Slater and Gordon is a good long-term buy to hold.
