The best time to buy businesses is when they are trading low prices, not when they are trading at high prices.
You shouldn't just buy any stock though, it's important to narrow the market down to a group of businesses you're interested in and buy when they're at an attractive level.
Here are two businesses on my watch list that are trading at attractive values:
Vita Group Limited (ASX: VTG)
Vita Group is the operator of over 100 Telstra Corporation Ltd (ASX: TLS) retail and business outlets. There has been uncertainty over the commercial relationship between the two in recent times, but there's a good chance it is actually a positive as Telstra aims to reduce the number of operators it deals with.
The Vita share price has reached a high of $5.35 and a low of $2.30 over the last six months. It's currently sitting at $3.55 which I think is an entry price worth considering. Vita should continue to benefit from Telstra's market-leading position and the growing Internet of Things.
Vita is trading at 15x FY16's earnings with a grossed-up dividend yield of 7%.
Freelancer Ltd (ASX: FLN)
Freelancer is the owner of one of the largest freelance websites in the world. It's rapidly building the number of freelancers using its site which is also attracting larger numbers of people looking for freelancers.
In its full year results to 31 December 2016, Freelancer updated the market to say that it had achieved a record number of 10.6 million projects. It's likely this will just keep growing higher as people realise the power of the internet and global opportunities.
Freelancer isn't yet making a profit when including non-cash share based payments.
Foolish takeaway
I think both of these companies have a strong chance of recovering some of their lost value.
At the current prices I think Freelancer offers the best long-term value, but Vita would be a great choice for Foolish investors looking for income. For a great growth stock offering a huge yield and growth check out this report.
