Major market indexes are trading near historical highs, and some stocks are starting to look a bit pricey, but that doesn´t mean that each and every company in the market is overvalued. On the contrary, there are plenty of opportunities around if you know where to look. These high-quality names offer compelling valuations and plenty of upside potential.
Investors in Apple Inc. (NASDAQ:AAPL) have suffered a serious setback in the last year, as growth has slowed down due to increased competition from Samsung and other hardware manufacturers. Shares of the Cupertino giant have fallen by nearly 30% over the last twelve months.
But things seem to be turning around lately, the company sold 31.2 million iPhones during the last quarter, a 20% increase versus 26 million devices sold in the same quarter of 2012. This was considerably above analysts’ expectations and it shows that Apple Inc. (NASDAQ:AAPL) still has room for growth in the high-end segment of the smartphone industry.
Management has repeatedly stated that new products from the company are coming this fall and through 2014, not only new versions of existing products, but also entirely new product categories. According to recent news reports, the company may launch its new iPhone models on September 10, and there has been a lot of speculation about the possibility of a new low cost version of the iPhone. This could be a powerful move to gain competitiveness and reignite growth in emerging markets.
Apple Inc. (NASDAQ:AAPL) accelerated its buyback program in the last quarter; the company repurchased an impressive $16 billion in its own stock. This may signal that management is optimistic about the coming products and its capitalizing the opportunity to repurchase stock while it’s still temporarily cheap. At a P/E ratio near 11.5, the company could certainly deliver attractive returns if it proves that it can continue bringing innovative and successful products to the market.
Ford Motor Company (NYSE:F) has been running at full speed lately, the F-Series provides the company with undisputed leadership in a key segment of the U.S. auto industry. This has been America´s bestselling vehicle for 36 consecutive years, and it delivered a whopping increase of 22% in unit sales for the first half of 2013. The real estate recovery is generating significant tailwinds for this key segment in the middle term, and this bodes well in terms of financial performance for the company.
Ford Motor Company (NYSE:F) has also been gaining market share in other segments of the market thanks to its widely acclaimed new models like Fusion and Escape among others. Under the leadership of Alan Mulally the company is building much better vehicles in terms of quality, and it’s doing so in a more efficient and cost effective manner.
Asia in general and China in particular could mean the next growth stage for the company, Ford Motor Company (NYSE:F) is clearly behind its competitors in the region, but rapidly gaining market share. The company sold 27% more vehicles in Asia-Pacific during the last quarter, reflecting mainly the strong performance in China, where sales were up more than 40%.
The stock is up by 34% year to date, but it still has room to go considering that the company is attractively valued in comparison to its peers. While Ford Motor Company (NYSE:F) trades at a P/E ratio of 11.2, General Motors carries a P/E near 12.9 and Japanese competitors are even more expensive with Honda and Toyota trading at P/E ratios of 18.5 and 15.75 respectively.