We asked our Foolish writers to name their top stock picks for October and below are some of their favourite businesses to buy now:
Tom Richardson: RCG Corporation Ltd (ASX: RCG)
Is the footwear retailer behind the youth-fashion chain HypeDc and sports shoes business The Athlete's Foot among others. RCG's share price has fallen amidst some tough retail conditions and concerns over the arrival of online retailer Amazon Inc. As a result shares change hands for 76.5 cents on just over 10x trailing earnings with a trailing yield of 7.8% plus the tax effective benefits of franking credits. The group has a long track record of profit growth and its experienced management team is forecasting another year of profit growth in FY 2018. It looks good value to me.
Motley Fool contributor Tom Richardson owns shares in RCG Corp shares.
Tim Katavic: Aristocrat Leisure (ASX: ALL)
The poker machine and gaming solutions company's stock is down almost 14% since its June high of $23.98. The acquisition of gaming company Plarium in August is expected to be earnings per share accretive in year one and provides greater income diversification by increasing revenue in the important digital market.
The mobile games market is expected to grow at 14% CAGR to 2020 as smartphone adoption rates increase the number of users in conjunction with improved monetisation strategies of the freemium business model. The stock trades at a forward P/E of ~21 which is not particularly expensive given its future prospects.
Motley Fool contributor Tim Katavic has no financial interest in Aristocrat Leisure Limited.
Tristan Harrison: Ramsay Health Care Limited (ASX: RHC)
Ramsay is Australia's largest private hospital operator and one of the largest in the world. There are large ageing demographic tailwinds which should benefit Ramsay over the next two decades.
However, near-term growth could be slower in France and the UK, which is why the share price has dropped down to $62. I think this is a great price for one of the highest quality businesses on the ASX with a long growth runway.
Motley Fool contributor Tristan Harrison owns shares of Ramsay Health Care Limited.
Kevin Gandiya: Aristocrat Leisure Limited (ASX: ALL)
At first glance, the Aristocrat Leisure share price looks expensive given its PE ratio of 25. A closer look however, reveals that its high growth (management expect FY2017 earnings growth of 25% – 30%) and high return on equity (currently at 32%) make this an attractive business to invest in.
Aristocrat's recent acquisition of Plarium Global at a price that is accretive to earnings could also be a smart move that increases the company's exposure to the fast-growing digital market. Aristocrat might provide strong total returns in the years ahead.
Motley Fool contributor Kevin Gandiya has no financial interest in Aristocrat Leisure Limited.
James Mickleboro: Nextdc Ltd (ASX: NXT)
With more and more businesses migrating their services over to the cloud, I believe this leading data centre operator is in a great position to profit. The strong demand that the company has experienced this year has led to management investing heavily to increase its capacity significantly. While this is expected to result in slower earnings growth in FY 2018, I believe its bottom line growth will accelerate in FY 2019 as it reaps the rewards of its investments.
Motley Fool contributor James Mickleboro owns shares in Nextdc Ltd.
Ian Crane: Macquarie Group Ltd (ASX: MQG)
Shares in diversified investment bank Macquarie Group have risen 10% since its recent investor presentation on 11 September.
The company announced it expected an improved first half of FY2018 result over the previous corresponding period. Additionally, Macquarie stated it is well positioned for success over the medium-term, supported by annuity-style income from significant business units. Macquarie pays an attractive dividend yield of 5% and with significant US earnings, should benefit from a weakening Australian dollar.
Motley Fool contributor Ian Crane has no financial interest in Macquarie Group Ltd.
Sean O'Neill: Sirtex Medical Limited (ASX: SRX)
Sirtex Medical is an out-of-favour healthcare company with a last-resort cancer treatment. Recently, it has been rocked by scandals that lead to an ASIC fine and the departure of former CEO Gilman Wong. However, with the new CEO scrapping the company's R&D expenditure, Sirtex could see growth in sales and substantially higher earnings in this full year. It currently looks to be priced at around 12x 2018's forecast profits, which is quite cheap for a healthcare company with no debt.
Motley Fool contributor Sean O'Neill owns shares in Sirtex Medical Limited.
