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With some Aussie share prices having plummeted, there’s never been a better time to buy stocks in finance, resources, infrastructure and retail – the sectors which are expected to bring strong long-term profits. Your Money Magazine spoke to expert market analysts to bring you these hot tips!

 

China and India’s persistent demand means stocks in Aussie resources will have great underlying value for some time. The recent tumble in mining share prices presents a fantastic opportunity for buyers. Fat Prophets’ Colin Whitehead highlights the copper and gold as the stand-outs in long-term value, even if their value is not represented in the current price.

 

The financial sector should also be high on your list. Unlike Europe or the US, our big four banks avoided the worst of the GFC. Benny Sada from the Australian Stock Report says banks will soon engage in serious cost-cutting to protect their profits, and credit growth should pick up again after several months. This should give impressive, stable dividend yields of 6 to 8 per cent.

 

Stocks in infrastructure are also attractive for value investors, as the industry will improve with population and economic growth. Since toll prices on the major roads are tied to inflation, this industry will continue to experience stable revenue growth. According to Sada, this is especially appealing for pension fund holders. As long as there are cars on the road, this sector should do well in the long term.

 

Retail: Roger Montgomery from the Eureka Report adds that retail is also fair game, given the current slump in the sector. The high Aussie dollar and poor consumer sentiment are merely temporary factors affecting retail. “Retail stocks have been beaten down to the point that they now present good value”, says Montgomery.

 

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