2 top ASX growth shares to buy for long-term growth

ASX growth shares typically pay a low dividend or no dividend at all. However, unlike dividend shares, the vast majority of profits is typically invested back into the company to support long-term growth. This can lead to very strong share price growth over the longer term for top performing ASX growth shares.

In this article, I’ll take you through two quality ASX growth shares that I think are worth buying and holding for the long term

2 ASX growth shares to buy and hold

Bubs Australia Ltd (ASX: BUB)

Bubs is an Australia-based producer of goat milk products. It has established a portfolio of premium, high-margin brands, concentrating on infant formula products. The company is now extending its product range across other categories. These include organic baby food and adult goat dairy products.

The Bubs share price trended downward from late 2019 until mid-March this year. It then trended upwards until early May, after which it has trended largely sideways.

The third quarter of FY 2020 was a stand-out quarter for Bubs. It recorded a very strong 67% increase in revenue to $19.7 million for the three months to March. This was driven by strong growth during the coronavirus pandemic. Fourth quarter results just released saw a 5% decline in gross sales on the prior corresponding period to $13 million for Bubs. However, sales grew strongly by 14% compared to quarter sales in the corresponding period last year.

I believe that Bubs is an ASX growth share that’s well positioned for long-term success, driven by its expanding presence in Asia.

REA Group Limited (ASX: REA)

The REA Group share price was significantly impacted during the the early phase of the coronavirus pandemic up to late March. However, since then, it has recovered most of those share price losses.

REA Group achieved a 1% increase in overall revenues for Q3 FY2020 to $199.8 million. I believe this was a solid result considering all the challenges it is facing during the pandemic.

REA Group is likely to face continued COVID-19 headwinds in the months ahead. However, I believe this ASX growth share is well positioned to perform strongly over the long term, once the pandemic finally subsides. I prefer REA Group over its rival Domain Holdings Australia Ltd (ASX: DHG) due to its expanding overseas division and larger local presence.

Foolish takeaway

Bubs and REA Group are both quality ASX growth shares that I believe are well positioned to outperform the S&P/ASX 200 Index (ASX: XJO) over the next five years. Both companies continue to perform strongly in their domestic market, while also focusing on successful international expansion strategies.

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Motley Fool contributor Phil Harpur owns shares of REA Group Limited. The Motley Fool Australia owns shares of and has recommended BUBS AUST FPO. The Motley Fool Australia has recommended REA Group Limited. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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