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4 Stocks Offering Growth At A Great Price: FirstGroup plc, Glencore PLC, Evraz plc And British American Tobacco plc

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FirstGroup

Today’s update from FirstGroup (LSE: FGP) has been well received by the market, with the company’s share price moving higher by 3.5% at the time of writing. And, with it stating that it is performing in-line with expectations, it looks set to deliver strong growth over the next couple of years.

In fact, FirstGroup is forecast to post a fall in earnings in the current year of 2%, but then bounce back strongly with growth of 27% next year. This puts it on a price to earnings growth (PEG) ratio of just 0.3, which indicates that its share price could move significantly higher over the medium term. Furthermore, with the company set to resume dividends next year, it could be yielding as much as 2.2% in 2016 and become a relatively appealing income play moving forward.

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Glencore

While a bid for Rio Tinto is still very much a realistic possibility, Glencore (LSE: GLEN) is all set to make excellent progress with or without further acquisitions. For example, it is expected to increase its bottom line by 23% in the current year, and by a further 53% next year.

Clearly, they are very ambitious forecasts and, as such, there is a fair chance that they could be subject to change in the intervening period. However, this should not be a major concern to investors in Glencore, since it offers a very wide margin of safety, which is evidenced by a PEG ratio of just 0.2. And, with a yield of 4.2%, Glencore also offers huge income appeal as well as growth at a very reasonable price.

Evraz

Shares in Evraz (LSE: EVR) are up by 6% today after the company released an upbeat set of 2014 results that included a proposal to return up to $375m to shareholders by way of a tender offer. This is due to the strong performance of the company in 2014, as well as its bright future prospects.

For example, Evraz is forecast to increase its bottom line by 42% in the current year, and by a further 23% next year. Despite this, it trades on a relatively low price to earnings (P/E) ratio of 12.9 and, when this is combined with its growth rate, it equates to a PEG ratio of just 0.3. As such, and while its shares have already risen by 150% in the last year, further share price gains could be on the cards in 2015 and beyond.

British American Tobacco

Even though British American Tobacco (LSE: BATS) is expected to post flat earnings growth in the current year, next year is forecast to see its bottom line rise by 8%. And, looking further ahead, it has great potential to deliver even better performance due to its considerable exposure to emerging markets.

This is of benefit to the company because regulations are becoming increasingly tougher in developed markets, and the number of smokers across the developing world continues to rise as population increases. As such, and while British American Tobacco’s current P/E ratio of 16.9 is not exactly dirt cheap, it does offer great value and excellent long term growth potential.

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Peter Stephens owns shares in Rio Tinto and British American Tobacco. The Motley Fool UK has no position in any of the shares mentioned. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors.

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