There are some S&P/ASX 200 Index (ASX: XJO) stocks that have been household names for Australian portfolios for many years.
But even those 'old reliables' have tough times and their journey is not perfectly linear.
Here are two longtime favourites that are in a dip at the moment, which long-term investors might like to take advantage of:
Revenue up, costs down: a simple equation
Thankfully, the market has now largely put its anxieties about Ozempic and other GLP-1 drugs in the past in their assessment of sleep apnoea device maker Resmed CDI (ASX: RMD).
However, after a boom January, the stock has now dived 8.7% in the past month.
Ord Minnett senior investment advisor Tony Paterno is urging long-term investors to look past this downturn to pounce.
"The company lifted revenue by 11% on a constant currency basis in the second quarter of fiscal year 2024 when compared to the prior corresponding period," Paterno told The Bull.
"We also anticipate margin expansion as ResMed's sales mix shifts to higher margin masks."
He feels ResMed is doing all the right things to boost margins.
"The firm reduced its global workforce by 5% in October 2023.
"The share price has recovered some of its substantial falls in the second half of fiscal year 2023, but has drifted recently to provide a cheaper entry point."
Encouraging signs for famous ASX 200 brand
Just as Telstra Group Ltd (ASX: TLS) looked buoyant in the middle of last year, it all came back tumbling down again.
The share price for the telco giant is down around 11% since the August reporting season.
Paterno thought the February update was encouraging.
"We view a 3% increase in underlying EBITDA to $4 billion in the first half of fiscal year 2024 as a positive result for this telecommunications giant," he said.
"Mobile EBITDA is on track to surpass $5 billion in fiscal year 2024, a remarkable turnaround from just above $3 billion less than four years ago."
Telstra shares have been annoying for investors in recent times, rising just 19% over the past half-decade.
Paterno acknowledges there are external factors that the company cannot control.
"We believe there's little management can do regarding structural pressures affecting fixed-line businesses. But it can recalibrate its costs.
"EBITDA margins are now approaching 48% compared with just 31% in fiscal year 2020."
