The prices of shares are constantly changing. This can be both useful and infuriating. It can make us experience joy or sorrow at seeing our shares be volatile, but it can also be great if it presents an opportunity for you to buy a share at a discounted price.
If I were given $10,000 I’d invest in the following shares to take advantage of opportunities:
Costa Group Holdings Ltd (ASX: CGC) – $2,000
The Costa share price has fallen around 14% since 21 June 2018, so to me that makes the food producer a more attractive opportunity.
It grows berries, tomatoes, citrus fruit, mushrooms and avocadoes. Food experts believe that food prices are going to increase significantly over the next two decades due to food scarcity as the global population increases.
Costa is growing profit at an impressive double digit rate each year and if it continues to compound its profit then today’s price could be attractive. It’s trading at around 26x FY19’s estimated earnings.
Paragon Care Ltd (ASX: PGC) – $3,000
Paragon is a small cap healthcare business that is acquiring other healthcare supplier businesses to increase its overall offering to its hospital and aged care customers. It is increasing the amount of different products it can sell.
The ageing tailwinds gives Paragon a good chance to steadily grow the total amount of products it sells. Hopefully price inflation and economies of scale will mean growing profit margins too.
Paragon is trading at only around 10x FY19’s estimated earnings.
Greencross Limited (ASX: GXL) – $2,000
Greencross is Australia’s biggest pet company. The market has turned very sour on its shares in recent times due to worries surrounding online retail and also the write-offs that the new CEO is implementing.
However, Greencross’ revenue is still growing nicely and if the management can improve profit margins then I think Greencross could generate nice returns in the medium-term considering it’s trading at 12x FY19’s estimated earnings.
Specialty Fashion Group Ltd (ASX: SFH) – $2,000
Specialty Fashion Group is selling all but one of its retail chains. It’s selling Millers, Katies, Crossroads, Autograph and Rivers for $31 million but it’s keeping City Chic. However, the other ones were losing money, so SFG will become more profitable afterwards.
City Chic is forecast to grow its revenue by over 22% between FY16 and FY18. Around 37% of its sales are online. It seems that Specialty Fashion could come out of its divestment process as a very effective niche retailer that is expanding overseas.
InvoCare Limited (ASX: IVC) – $1,000
The market-leading funeral business is projected to grow over the coming decades due to rising death rates. However, it could also be creating a short-term boost with it announcing so many regional acquisitions.
I believe the investment that InvoCare is making into refurbishing its locations will pay off over the medium-term and will lead to increased organic growth, however the business isn’t trading cheaply.
I have put my money where my mouth is with most of the above ideas, as I’m invested in all my share ideas except Speciality Fashion. At the current prices I think Paragon could be the best option because of how cheaply it’s trading compared to its expected FY19 profit. It could re-rate higher by the FY19 result or earlier.
If I had another $10,000 to invest then I’d definitely want to consider these top growth shares for my portfolio.
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Motley Fool contributor Tristan Harrison owns shares of COSTA GRP FPO, Greencross Limited, InvoCare Limited, and Paragon Care Limited. The Motley Fool Australia owns shares of and has recommended COSTA GRP FPO and Greencross Limited. The Motley Fool Australia has recommended InvoCare Limited and Paragon Care Limited. 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 Scott Phillips.