If you’re looking for additions to your retirement portfolio, then I think the ASX 50 index is a great place to start.
The ASX 50 index is a large cap index which has been designed to represent 50 of the largest and most liquid shares listed on the ASX based on their float-adjusted market capitalisation.
But which ASX 50 shares should you buy? I think the two listed below could be top options right now:
Coles Group Ltd (ASX: COL)
I think that Coles is one of the best shares for a retiree to own right now. This is due to its solid long term growth potential, cost cutting, generous dividend policy, and defensive qualities. The supermarket giant has displayed the latter this year with its strong sales and profit growth during the pandemic. Coles reported a 6.9% increase in sales to $37.4 billion and a 7.1% lift in net profit after tax to $951 million in FY 2020.
The good news is that the company has started the new financial year strongly and looks well placed to deliver another solid profit result in FY 2021. This should put Coles in a position to reward shareholders with another generous dividend next year. Based on the current Coles share price, I estimate that it offers a fully franked FY 2021 3.3% dividend yield.
CSL Limited (ASX: CSL)
I think this biotherapeutics giant CSL would be a good addition to a retirement portfolio. While it may not provide investors with an overly attractive yield, I believe its dividend can grow strongly over the next decade thanks to its positive long term outlook.
This is thanks to its talented management team, its lucrative research and development pipeline, and the strength of its existing therapies and vaccines. The latter include key immunoglobulins products such as Privgen and Hizentra and haemophilia products Idelvion and Afstyla. Combined, I believe they have positioned CSL to deliver consistently solid earnings growth over the 2020s and beyond.
Man who said buy Kogan shares at $3.63 says buy these 3 ASX stocks now
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*Returns as of 6/8/2020
More reading
- Should you buy ASX shares before or after reporting season?
- Buy CSL and these quality ASX blue chip shares today
- Is the CSL share price a buy?
- Where to hunt for ASX dividend share income in 2020
- Why CSL, Iress, Santos, & Webjet shares are dropping lower
James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of CSL Ltd. The Motley Fool Australia owns shares of COLESGROUP DEF SET. 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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