With the ASX crashing below 5000, this top fund manager is eyeing a bargain

With the S&P/ASX 200 Index crashing back below 5,000, investors are probably wondering whether now is a great buying opportunity.

The AFR posed that very question to some top fund managers. Most advised against buying mining shares — I guess that counts buying BHP Billiton Limited (ASX: BHP) shares out, even with its share price dipping below $16 — but all were looking at the sell-off as an opportunity to snap up a few bargains.

Julian Beaumont, Bennelong Australian Equity Partners investment director, said he would look to add to positions in companies with “essential services” such as telecommunications and healthcare, as well as those supported by other tailwinds such as tourism.

A look through Bennelong’s Australian Equities Fund recent performance reports suggests these three ASX shares might be close to the top of Mr Beaumont’s list…

Flight Centre Travel Group Ltd (ASX: FLT)

The Flight Centre share price has recently rallied from $34 to $40, before falling back to around $38. Bennelong points to new retail stores, growth in corporate and expanding the overseas businesses as offering decent growth over the foreseeable future. Flight Centre shares trade on a modest valuation of 14 times forward earnings and on a forecast fully franked dividend yield of 4.2%.

TPG Telecom Ltd (ASX: TPM)

The TPG Telecom share price has recently fallen from an all-time high of over $11 back down towards $9. Bennelong notes that the company owns an extensive fibre network, strong retail consumer telco brands and a decent corporate business. Trading on a forecast P/E of 23 times earnings, and a forecast fully franked dividend yield of 1.6%, TPG Telecom shares may not look overly cheap, but the company is growing quickly. In August last year, the company announced its 2015 financial year results, with revenues and EPS both growing 31% on the prior year.

CSL Limited (ASX: CSL)

The CSL share price has held up reasonably well during this recent market sell-off, now trading at $103. One of Bennelong’s top five holdings, the fund manager says both CSL and Ramsay Health Care Limited (ASX: RHC) should generate reliable earnings growth derived from the increasing healthcare needs of an ageing population, market share gains or the innovation of new products and services. CSL shares trade on a forward P/E of 28 times earnings and a forward dividend yield of 1.75%.

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Of the companies mentioned above, Bruce Jackson has an interest in Flight Centre.

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