Thankfully for investors, the Australian share market is home to a good number of high quality blue chip shares to choose from.
Two blue chips which could be worth considering as additions to your portfolio in 2021 are listed below. Here’s what you need to know about them:
Cochlear Limited (ASX: COH)
Cochlear is one of the world’s leading hearing solutions companies. It has been a very positive performer over the last decade thanks to its consistently strong sales and profit growth.
Pleasingly, the company appears well-positioned to continue this trend over the next decade due to its strong market position, leading technology, and its exposure to the ageing populations tailwind.
In respect to the latter, by 2050 there are forecast to be 1.5 billion people over the aged of 65. This will be almost triple the number of over 65s in 2010. This bodes well for demand for its product portfolio. And with management investing heavily in research and development, it looks well-placed to maintain its leadership position.
Analysts at Macquarie are positive on the company’s prospects and believe Cochlear is winning market share in the United States. They currently have an outperform rating and $241.00 price target on its shares.
REA Group Limited (ASX: REA)
REA Group has been a strong performer in recent years despite battling with a housing market downturn and the COVID-19 pandemic. This demonstrates the resilience of its business model and its exceptionally strong market position.
The good news is the housing market has been tipped to rebound very strongly in 2021, with some banks even forecasting record house prices. This bodes well for REA Group as it could lead to a jump in listing volumes.
Another positive is the potential for price increases, new revenue streams, and its costs remaining low post-pandemic. Combined, these could underpin an acceleration in its earnings growth in the coming years.
That is something analysts at Morgan Stanley are expecting. They recently slapped an overweight rating and $150.00 price target on the company’s shares on the belief that a “super cycle” is coming.
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More reading
- The two ASX stocks most impacted by the dangerous rise of the Aussie dollar
- 2 ASX 200 healthcare shares that outperformed in November
- 10 fantastic ASX shares to buy in December
- 2 ASX blue chip shares tipped as buys
- Is the Cochlear (ASX:COH) share price a long term market beater?
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 Cochlear Ltd. The Motley Fool Australia has recommended Cochlear Ltd. and REA Group Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.
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