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Why you should bet on CSL Limited, Commonwealth Bank of Australia and Amcor Limited

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2015 has been another positive year for investors in health care company CSL Limited (ASX: CSL), with its shares rising by 15% since the turn of the year. Looking ahead, further capital gains are on the cards since the health care sector is becoming increasingly popular across the globe due to its relative lack of cyclicality. Given the uncertain macroeconomic outlook, more defensive companies which also offer strong growth rates have scarcity value.

Furthermore, CSL’s business model appears to be sound, with the company stating that the integration of the influenza vaccination business is progressing well. This should help it to continue to post excellent returns, with its return on equity of 47% last financial year highlighting just how profitable the business is.

With CSL expected to grow its bottom line by 12.5% per annum during the next two years, investor sentiment could pick up further and push its price to earnings growth (PEG) ratio of 2.1 even higher. And, with CSL’s $1bn share buyback announced recently likely to give its shares a boost, now could be a sound moment to buy a slice of the company for the long haul.

Similarly, packaging company Amcor Limited (ASX: AMC) is also a worthy buy, with a significant proportion of its sales being derived from outside of Australia. Not only does this provide a degree of diversification, it also means that Amcor is able to access faster growing markets and this is set to be of benefit to its earnings, with the company forecast to increase its bottom line by 6% in the current year. Furthermore, with the Aussie dollar weakening and likely to weaken further if interest rates continue to fall, Amcor’s financial performance could benefit from a translation gain, too.

In addition, Amcor’s acquisition strategy appears to be a successful means of adding to its organic growth potential. For example, the purchase of Encon’s preform manufacturing business for US$55m should provide considerable synergies and reduce further capital requirements for Amcor’s rigid plastics business. With Amcor trading on a price to sales (P/S) ratio of 1.3 versus 1.4 for the ASX, its shares could continue to outperform the wider index as they have done by 94% in the last five years.

Meanwhile, Commonwealth Bank of Australia (ASX: CBA) has posted a rise in its share price of 4% in the last month following an upbeat set of first quarter results. Its common equity tier 1 ratio increased by 70 basis points to 9.8%, with its cash earnings rising to $2.4bn from $2.3bn in the comparable quarter from last year. And, with CBA forecast to increase its earnings at an annualised rate of 5.8% during the next two years, its price to earnings (P/E) ratio of 14.5 indicates good value versus the ASX’s P/E ratio of 15.7.

Additionally, CBA’s yield of 5.3% holds great appeal while interest rates are falling and is 70 basis points higher than the ASX’s yield. Furthermore, with dividends being covered 1.3x by profit, there is scope for above inflation rises in shareholder payouts over the medium to long term, too.

Despite this, there is another ASX stock that I believe could outperform CBA, CSL and Amcor.

In fact, it's recently been named as The Motley Fool's Top Stock For 2015 and could make a real impact on your bottom line as we move through the year. As a result, it's well worth finding out more about it.

Click here to do so - it's completely free and comes without any obligation.

Motley Fool contributor Peter Stephens has no position in any stocks mentioned. Unless otherwise noted, the author does not have a position in any stocks mentioned by the author in the comments below. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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