I'm always on the lookout for Australian stocks that could be market-beaters over the long-term. The market volatility over the last several months has definitely opened up an opportunity for investors to grab a great deal.
We don't have to rush when it comes to investing, we can wait for the right opportunity to come along. Prices and economic conditions are always changing, so at some point we will get the opportunity we're looking for.
I believe both businesses are undervalued for what they could achieve over the next three or so years.
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Breville Group Ltd (ASX: BRG)
Breville is a leading example of an Australian business that has successfully expanded overseas. It's best-known for its Breville brand of coffee machines and other small appliances, but it also owns Sage, Lelit, Baratza and Beanz.
It looks like a good time to consider the Breville share price because it has fallen more than 20% since August 2025, as the below chart shows.
While the operating environment is more challenging than it was a couple of years ago, the business continues to grow globally.
In the FY26 half-year result, its dominant global product segment saw Americas revenue growth of 11.6% to $549.5 million, Asia Pacific revenue growth of 5.9% to $190.3 million and EMEA (Europe, the Middle East and Africa) growth of 13.7% to $233.8 million.
I believe the business is well positioned to continue delivering double-digit revenue improvement as it expands in markets where there's plenty of room for growth for coffee consumption such as South Korea and China.
Once the business has finished adjusting its manufacturing for the US market to countries without the same tariff negatives as China, then I think there's good scope for strong profit growth for Breville.
According to the profit projection on CMC Invest, the Australian stock is forecast to grow profit by around 30% between FY26 to FY28. It's currently valued at less than 24x FY28's estimated earnings.
JB Hi-Fi Ltd (ASX: JBH)
JB Hi-Fi is a leading electronics and appliance retailer, with four different businesses – JB Hi-Fi Australia, JB Hi-Fi New Zealand, The Good Guys and E&S.
I believe this looks like a good time to invest because the JB Hi-Fi share price has fallen by 32% in the past year, as the below chart shows.
Higher inflation and interest rates may well be a headwind for the Australian stock in the shorter-term. But, sales performance remains solid – in the third quarter of FY26, JB Hi-Fi Australia sales were up 4% year over year, The Good Guys sales were up 2.5% and JB Hi-Fi New Zealand sales were up 23.2%.
I think JB Hi-Fi's revenue and earnings are more defensive than the market is giving the business credit for, with consistent demand for things like phones, computers and appliances.
The business is predicted to generate $4.50 of earnings per share (EPS) in FY26, according to the forecast on CMC Invest. That puts the business at 16x FY26's estimated earnings. It could also pay a FY26 grossed-up dividend yield of 6.8%, including franking credits.
