There are times when the market creates great long term buying opportunities - times that make people say, "If I had only bought then, I would have made..."

We are in one of those times now. For the long term investor there are nothing but very attractive long-term values out there. The recent market selloff and panic created these once-in-a-generation opportunities provided we are bold enough to take advantage. Potential long term growth opportunities include: Southern Copper (NYSE:PCU), Baidu.com (Nasdaq:BIDU), and Research In Motion (Nasdaq:RIMM, TSX:RIM).

Turn Copper into Gold
Despite the name, there is more to Southern Copper than copper. The mining company and produces and sells various ore including silver, lead, zinc and, yes, copper. The company is looking very attractive, and from a valuation standpoint it looks down-right cheap. The stock is currently trading at a forward P/E ratio of around 6. It has $1.25 billion in cash and $1.29 billion in debt, according to its most recent quarter. Also, insiders currently own 75.10% of the stock. Finally, Southern Copper pays a dividend of $2.28 or 20.10%. In a nutshell what this tells us is that we have a cheap stock from a valuation standpoint, with a reasonable debt load, lots of cash on the books, heavily owned by the insiders, and paying a great dividend. It is only a matter of time until the market realizes what a great value the company is.

Investors can also earn a great dividend while they are in the stock. At the end of the day you might be able to make a nice profit and dividend. When you put these elements together your overall return has the potential be significantly greater than the overall market averages. (To learn more, see Panic Selling - Capitulation Or Crash?)

Baidu.com's Resilience in the Face of Adversity
Baidu.com can be a volatile stock; however, during periods, of extreme weakness investing in the top Chinese internet search engine might not be a bad idea for the right investor. While the company does have a higher valuation with a forward P/E ratio of 36, it is important to note that it has $281 million in cash and no debt. Baidu also has had a positive income statement with regards to expectations. Over the past four quarters the company has met or beat analysts expectations.

During the last quarterly earnings announcement the company did have some cautious guidance surrounding the potential disruptions of the Beijing Olympics, stating a revenue growth rate expectation of 13-16%. In late July, two Research Analysts with Citi Investments (Catherine Leung and Jason Brueschke) said, "Despite concerns over potential disruptions from the Olympics on Baidu's Q3, the company gave guidance that was reassuring enough to allay concerns over significant impact, in our view." Since July shares have sold off significantly, down almost 30% to the October 14 close of $250.25. The recent selloff might have created an opportunity for investors that can stomach the risk. The next earnings announcement is scheduled for October 22.

Research In Motion has Promise
It is interesting how selloffs like the one we have seen recently cause investors to sell the good stocks along with the bad ones. In my opinion, Research In Motion is a situation where the baby was thrown out with the bath water for no other than fear. The company is currently trading at a forward P/E of around 12. It has $1.55 billion in cash and $6.91 million in debt. From a valuation standpoint what this means is that it only a matter of time until we see the market notice Research In Motion's great balance sheet and solid fundamentals.

Bottom Line
As we can see there are many strong companies that have great valuations and have the potential for long term growth. The important thing to remember is that during times like these we must keep our heads when everyone else is losing theirs. By doing so we will look back with satisfaction at the investment decisions we made in 2008.

To learn more, check out Profiting From Panic Selling.

Related Articles
  1. Investing News

    What You Can Learn from Carl Icahn's Mistakes

    Carl Icahn has been a stellar performer in the investment world for decades, but following his lead these days could be dangerous.
  2. Stock Analysis

    Analyzing Altria's Return on Equity (ROE) (MO)

    Learn about Altria Group's return on equity (ROE) and analyze net profit margin, asset turnover and financial leverage to determine what is causing its high ROE.
  3. Investing News

    Icahn's Bet on Cheniere Energy: Should You Follow?

    Investing legend Carl Icahn continues to lose money on Cheniere Energy, but he's increasing his stake. Should you follow his lead?
  4. Stock Analysis

    Analyzing Google's Return on Equity (ROE) (GOOGL)

    Learn about Alphabet's return on equity. How has its ROE changed over time, how does it compare to its peers and what factors are driving ROE for the company?
  5. Investing News

    Is Buffett's Bet on Oil Right for You? (XOM, PSX)

    Oil stocks are getting trounced, but Warren Buffett still likes one of them. Should you follow the leader?
  6. Investing News

    Chipotle Served with Criminal Probe

    Chipotle's beat muted expectations and got a clear bill from the CDC, but it now appears that an investigation into its E.coli breakout has expanded.
  7. Stock Analysis

    Analyzing Sprint Corp's Return on Equity (ROE) (S)

    Learn about Sprint's return on equity. Find out why its ROE is negative and how asset turnover and financial leverage impact ROE relative to Sprint's peers.
  8. Stock Analysis

    Why Alphabet is the Best of the 'FANGs' for 2016

    Alphabet just impressed the street, but is it the best FANG stock?
  9. Investing News

    A 2016 Outlook: What January 2009 Can Teach Us

    January 2009 and January 2016 were similar from an investment standpoint, but from a forward-looking perspective, they were very different.
  10. Mutual Funds & ETFs

    3 Vanguard Equity Fund Underperformers

    Discover three funds from Vanguard Group that consistently underperform their indexes. Learn how consistent most Vanguard low-fee funds are at matching their indexes.
RELATED FAQS
  1. How do dividends affect retained earnings?

    When a company issues a cash dividend to its shareholders, the retained earnings listed on the balance sheet are reduced ... Read Full Answer >>
  2. What is the difference between called-up share capital and paid-up share capital?

    The difference between called-up share capital and paid-up share capital is investors have already paid in full for paid-up ... Read Full Answer >>
  3. Why would a corporation issue convertible bonds?

    A convertible bond represents a hybrid security that has bond and equity features; this type of bond allows the conversion ... Read Full Answer >>
  4. How does additional paid in capital affect retained earnings?

    Both additional paid-in capital and retained earnings are entries under the shareholders' equity section of a company's balance ... Read Full Answer >>
  5. What types of capital are not considered share capital?

    The money a business uses to fund operations or growth is called capital, and there are a number of capital sources available. ... Read Full Answer >>
  6. What is the difference between issued share capital and subscribed share capital?

    The difference between subscribed share capital and issued share capital is the former relates to the amount of stock for ... Read Full Answer >>
COMPANIES IN THIS ARTICLE
Trading Center