While many Aussie investors are feeling very uncertain at the moment, with the ASX being relatively high and the Aussie economy enduring a rough patch, now could be a great time to invest.
Certainly, the RBA's decision to cut rates and potentially move them even lower may not be enough to stave off a difficult period for hardworking families across Australia and, in cutting rates, a housing bubble could lie just around the corner.
However, the valuations of a number of blue-chips remain appealing and, with strong growth potential and upbeat dividend prospects, they could be worth buying for the long term, even though their short term outlook may be somewhat uncertain.
With that in mind, here are three top ASX stocks that could be set to soar.
BHP Billiton Limited
While there was excitement among investors recently as a result of BHP Billiton Limited's (ASX: BHP) decision to slow its rate of output expansion, the fact remains that BHP is attempting to increase its market share and squeeze competitors over a prolonged period. And, while this has undoubtedly caused further weakness in the iron ore price, it could leave BHP in a relatively strong position.
Although BHP's profitability is declining, its financial standing remains strong and this is enabling the company to continue increasing dividend payments, with them due to rise at an annualised rate of 12.4% during the next two years. This puts BHP on a fully franked yield of 4.4%, with dividends being covered 2.1 times in financial year 2014.
Amcor Limited
For investors who are seeking exposure to faster growing markets across the emerging world, Amcor Limited (ASX: AMC) is a logical play, since the packaging company is continuing to expand its footprint across the globe. This could be of major benefit to its bottom line if, as expected, the RBA cuts interest rates further and causes the Aussie dollar to become weaker.
In addition, Amcor also offers a growth rate in dividends per share of 14.3% during the next two years. This puts it on a forward yield of 4% which, when combined with a beta of 0.9, makes Amcor a strong defensive play. It also has an exposure to the emerging world, which should provide a fillip to its bottom line in the long run, too.
National Australia Bank Ltd.
Although there are understandable concerns that a number of the Aussie banks are now overvalued, the macroeconomic outlook for the country suggests otherwise. Certainly, the likes of National Australia Bank Ltd. (ASX: NAB) trade on relatively high valuations with it, for example, having a price to book (P/B) ratio of 2.04 versus 1.3 for the ASX.
However, with interest rates set to move lower, asset prices may gain a boost and this could provide NAB's bottom line with improved performance in 2015 and beyond. In fact, the bank's earnings are due to rise by over 17% per annum during the next two years, which puts it on a highly desirable price to earnings growth (PEG) ratio of just 0.92.
Of course, finding the best stocks for the long term is a tough ask – especially when work and other commitments limit the amount of time you can spend trawling through the index for them.
