Buy now: Experts name 2 ASX 200 companies essential to Aussie life

In case you’ve not realised, interest rates are now 275 basis points higher than where they were seven months ago.

This hefty rise in mortgage repayments will really start to bite in the coming months. Australian consumers will start closing their wallets and there will be less revenue for businesses.

So with the economy well and truly in a slowing part of the cycle, it’s vital to be selective about the ASX shares you buy right now.

One way to minimise damage during slowdowns and recessions is to pick businesses that provide essential goods and services.

Here are a couple of expert suggestions:

‘A quality and well managed business’

When you talk staples, they don’t come much more essential than food.

Elders Ltd (ASX: ELD) is an agribusiness that provides goods and services to farmers around the nation.

Seneca investment advisor Arthur Garipoli was impressed with the company’s recent updates.

“The Australian agribusiness posted a strong fiscal year 2022 result,” Garipoli told The Bull.

“Underlying earnings before interest and tax were $232.1 million, up 39% on the corresponding period.”

However, the Elders share price has struggled in recent times. It plunged 23% in one day earlier this month.

Garipoli is not worried for the long term though.

“Severe rainfall in several rural regions has been weighing on the share price,” he said.

“However, we believe Elders is a quality and well managed business that should continue to outperform.”

‘Strong position and generating growth’

Nanosonics Ltd (ASX: NAN) is not a name synonymous with staple products, but it manufactures a critical medical product that many people would have been an unknowing beneficiary of.

The company makes disinfectors for ultrasound scanning probes.

Morgans investment advisor Jabin Hallihan rates the stock a buy.

“More than 25 million patients a year are protected from the risk of ultrasound probe cross-contamination by Nanosonic’s Trophon technology,” he said.

“The company is in a strong position and is generating growth.”

The healthcare industry is a sector known to enjoy resilient demand through tougher economic periods. And ultrasound scans are a very common diagnostic procedure in modern times.

Hallihan reckons Nanosonics is headed in the right direction financially.

“Total revenue of $52.6 million in the first four months to October 31, 2022 was up 42% on the prior corresponding period,” he said.

“A positive trading update suggests consensus forecasts will be comfortably achieved.”

The post Buy now: Experts name 2 ASX 200 companies essential to Aussie life appeared first on The Motley Fool Australia.

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More reading

• Here are the 10 most shorted ASX shares
• Skin in the game: The ASX share in my portfolio I’m most excited about
• Here are the top 10 ASX 200 shares today
• Why Nanosonics, Nick Scali, NRW, and Tyro shares are charging higher
• Don’t miss out on these top ASX dividend shares: analysts

Motley Fool contributor Tony Yoo has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Nanosonics Limited. The Motley Fool Australia has positions in and has recommended Nanosonics Limited. The Motley Fool Australia has recommended Elders Limited. 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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