2016 has been a very disappointing year for investors in Aviva (LSE: AV). The life insurer’s share price has fallen by 15% year-to-date, which is well behind the 1% gain of the wider index during the same time period.

This performance is rather surprising, since Aviva has the potential to become a dominant player within the life insurance space following its merger with Friends Life. Although there are risks to the deal, Aviva appears to be delivering on the synergies it expected and the integration of Friends Life seems to be progressing relatively well. Evidence of this can be seen in Aviva’s forecast earnings growth rate for next year, which currently stands at 8%.

After its share price fall, Aviva now trades on a price-to-earnings (P/E) ratio of only 9.4. As such, there seems to be at least 20% upside potential on offer, since this would equate to a still very enticing rating of just 11.3. And with Aviva having a yield of 5.4%, it remains a top-notch income play for the long term too.

Defensive play

Also offering 20% upside is Coca Cola HBC (LSE: CCH). Its bottom line is forecast to rise by 19% in the current year and by a further 10% next year, which means that even if its rating were to fall it could still offer over 20% capital gains. And with Coca Cola HBC having a price-to-earnings growth (PEG) ratio of 1.7, it appears to offer good value for money, which should mean that a rating expansion is more likely than a rating reduction.

As well as capital gain prospects, Coca Cola HBC also offers upbeat dividend growth potential. It may yield just 2.3% right now, but with dividends being covered more than twice by profit, there’s scope for shareholder payouts to increase at a faster pace than profit. Furthermore, with Coca Cola HBC having a relatively resilient business model it could prove to be a sound defensive play.

Growth and income appeal

Meanwhile, Diageo (LSE: DGE) continues to offer stunning long-term growth potential and could easily rise by 20%-plus over the medium term. A key reason for this is its long-term growth potential, with Diageo being well-positioned in emerging markets and also having the relative resilience of exposure to more established markets. And with it having a wide range of products in different beverages categories, Diageo continues to offer a potent mix of defensive qualities and upbeat growth potential.

While Diageo trades on a P/E ratio of 21.3, its rating could move higher. That’s because the consumer goods sector has historically enjoyed higher ratings than many other industries, so a P/E ratio of over 25 wouldn’t be considered extreme. Moreover, with Diageo expected to grow its earnings by 8% next year and having the potential to grow its dividend at a rapid rate, it seems to have high appeal for growth as well as income investors.

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Peter Stephens owns shares of Aviva. The Motley Fool UK has recommended Diageo. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors.