Holding an ASX share until 2040 is a big commitment.

For me, that means looking for businesses with strong competitive positions, long growth runways, and products or services that should still be relevant many years from now.

These are five leading ASX shares I would be comfortable buying with that timeframe in mind.

Pro Medicus Ltd (ASX: PME)

Pro Medicus would be one of my first choices. Its Visage imaging software is used by major healthcare organisations to manage and view increasingly large volumes of medical imaging data.

What I like is the combination of a highly scalable software model and exposure to a healthcare system that continues to generate more imaging.

The technology company has also shown it can win large customers in the United States, giving it plenty of room to keep expanding internationally.

By 2040, I think medical imaging will be even more digital, data-heavy, and AI-assisted than it is today. Pro Medicus looks well placed to grow alongside that shift.

Commonwealth Bank of Australia (ASX: CBA)

CBA brings a very different type of strength.

It is already Australia’s largest bank, with leading positions across home lending, deposits, and digital banking.

That means I would not expect explosive growth over the next 14 years. The attraction here is the quality and resilience of the franchise.

Banking should remain a core part of the Australian economy for decades, and I think CBA’s scale, customer base, and technology investment leave it well positioned to keep earning attractive returns.

For me, that makes it the major bank I would be most comfortable owning through multiple economic cycles.

Cochlear Ltd (ASX: COH)

Cochlear is another ASX share I think suits a very long investment horizon.

The company is a global leader in implantable hearing solutions, helping people with severe hearing loss regain access to sound.

Ageing populations and greater awareness of hearing loss could continue to increase demand over time, while ongoing innovation should broaden the range of patients who can benefit from treatment.

I also like that Cochlear operates in a specialised medical field where clinical expertise, technology, and trusted relationships with healthcare professionals are difficult to replicate.

That gives me confidence in its ability to remain relevant well beyond the next few years.

Xero Ltd (ASX: XRO)

Xero would provide the portfolio with long-term technology exposure.

Its accounting platform is deeply integrated into the day-to-day operations of small businesses, accountants, and bookkeepers across the world.

However, with a total addressable market estimated to be around 100 million businesses globally, Xero is still only scratching the surface of its market opportunity with its 4.9 million customers.

If the company can keep growing its market share, I think it could be a much larger business by 2040.

NextDC Ltd (ASX: NXT)

This ASX share rounds out my five.

NextDC develops and operates data centres, giving investors direct exposure to the enormous growth in digital infrastructure.

Cloud computing was already driving demand before the current AI boom. Artificial intelligence is adding another layer because training and running increasingly powerful models requires huge amounts of computing capacity.

That creates demand for secure facilities with access to power, connectivity, and large amounts of technical infrastructure.

NextDC still has plenty to execute as it expands its capacity, but I think the structural demand behind the business could run for many years.

Foolish takeaway

A lot can change between now and 2040, so I would not expect every year to be smooth for any of these businesses.

What gives me confidence is that each one is exposed to a long-term need I can still see as important well into the future, whether that is healthcare, banking, small-business software, or digital infrastructure.

That is the sort of foundation I would want before committing to holding an ASX share for the next 14 years.

The post 5 leading ASX shares I’d buy and hold until 2040 appeared first on The Motley Fool Australia.

More reading

• Commonwealth Bank vs ANZ: Which is better for passive income?
• Sell alert! Expert calls time on Corporate Travel and CBA shares
• Buy, hold, sell: Premier Investments, New Hope, Xero shares
• Can the Xero share price climb back to $100?
• ASX 200 holds steady as investors brace for a big afternoon

Motley Fool contributor Grace Alvino has positions in Commonwealth Bank Of Australia. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Cochlear and Xero. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has recommended Pro Medicus. The Motley Fool Australia has positions in and has recommended Xero. The Motley Fool Australia has recommended Cochlear and Pro Medicus. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

This period of time seems to have heightened uncertainty, with plenty of disruption with energy prices, wider inflation, technology changes, and bond yields. I’m also seeing elevated dividend yields on offer from high-quality ASX dividend shares that pay passive income.

I don’t expect interest rates to stay this high forever, so I believe opportunistic investors can buy stocks at a discount, with a high dividend yield.

With that in mind, I’m going to highlight two ideas that look like unmissable buys right now for investors who want passive income.

Centuria Industrial REIT (ASX: CIP)

I believe the real estate investment trust (REIT) sector is significantly undervalued, considering the consistent rental income it generates and the importance (and scarcity) of the land it owns.

Industrial properties are in high demand in metropolitan locations because of both a shortage of facilities and tailwinds from multiple demand drivers. For example, e-commerce adoption, data centres, and refrigerated space (for food and medicine) are all increasing the value of industrial real estate over time.

During FY26, the business reported 5.2% like-for-like net operating income (NOI) growth. That was partly boosted by 30% positive re-leasing spreads, meaning that new rental contracts are generating 30% more rental income than the old contract.

According to the ASX dividend share, its real estate portfolio is still on average 17% ‘under-rented’, so its rent could continue to grow strongly over the next several years as leases come up for renewal.

It has guided that it will grow its distribution by 3% in FY27 to 17.3 cents, which now represents a distribution yield of 6.1%, which is an impressive starting point.

In my view, it’s very cheap. It reported net tangible assets (NTA) of $4.01 at 30 June 2026. It’s currently trading at a discount of 30% to that figure.

MFF Capital Investments Ltd (ASX: MFF)

The other ASX dividend share I want to highlight is the listed investment company (LIC) MFF.

I think it’s great to be able to invest in one name and get exposure to a diversified portfolio. MFF owns a portfolio and aims to invest in competitively advantaged global businesses with strong outlooks.

Some of the businesses currently in the portfolio include Mastercard, Alphabet (Google), Visa, Bank of America, Amazon, and Microsoft.

By investing in these great companies, MFF is unlocking investment returns which it then uses some of to pay a growing dividend. The retained profits can then be used for further compounding.

I think MFF will grow its FY27 dividend by 19% to 25 cents per share. That translates into a potential forward grossed-up dividend yield of 6.6%, including franking credits, at the time of writing. It has hiked its regular annual dividend every year since 2018, and the payout continues to grow.

The post 2 great ASX dividend share buys for passive income in October appeared first on The Motley Fool Australia.

More reading

• How much do I need to retire on $110,000 a year at 65?
• Where I’d invest in ASX shares after the recent RBA rate rise
• How much is needed in superannuation to target a $10,000 monthly passive income?
• 15 ASX shares going ex-dividend next week
• How much is needed in superannuation to target a $95,000 annual passive income?

Bank of America is an advertising partner of Motley Fool Money. Motley Fool contributor Tristan Harrison has positions in Mff Capital Investments. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Alphabet, Amazon, Mastercard, Microsoft, and Visa. The Motley Fool Australia has positions in and has recommended Mff Capital Investments. The Motley Fool Australia has recommended Alphabet, Amazon, Mastercard, Microsoft, and Visa. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

Inflation is back in focus on Wednesday after the latest Consumer Price Index (CPI) figures were released.

The Australian Bureau of Statistics (ABS) published its August inflation report this morning, giving investors plenty to digest.

The release comes just one day after the Reserve Bank of Australia (RBA) announced its latest interest rate decision.

With inflation still a key concern for the central bank, today’s numbers could play a part in where interest rates go next.

So, what did today’s numbers reveal?

Inflation climbs back to 4%

The latest figures showed headline inflation rose 4% over the 12 months to August, up from 3.5% in July.

Consumer prices also increased 0.4% during August, although that climbed to 0.7% on a seasonally adjusted basis.

Transport prices were a big part of the increase, rising 4.2% during the month and 5.6% over the past year.

Much of that came from automotive fuel prices, which jumped 14.8% in August and were 13.5% higher than a year ago.

Housing costs also remained high, rising 5.7% over the past 12 months, while education prices increased 4.7% and health costs climbed 3.9%.

Meanwhile, the underlying inflation figures were more stable.

Trimmed mean inflation, which removes some of the more volatile price movements, remained unchanged at 3.6% annually.

It was up just 0.2% during August.

Are more interest rate hikes coming?

Today’s inflation figures could give the RBA another reason to keep interest rates higher.

The central bank lifted the cash rate by 25 basis points to 4.60% yesterday, marking its fourth increase this year.

In its statement, the RBA said inflation remained too high and pointed to several risks that could keep prices elevated.

That included higher energy prices, continued capacity pressures in the economy, and businesses passing higher costs onto customers.

Today’s figures show some of those pressures are still hanging around, particularly with fuel prices jumping during August.

However, the unchanged trimmed mean figure of 3.6% suggests underlying inflation hasn’t moved higher.

The RBA has already made it clear that it is prepared to lift rates again if needed.

Foolish takeaway

From here, the next few inflation reports will be important.

Headline inflation is back at 4%, while underlying inflation remains above the RBA’s 2% to 3% target range.

For me, that keeps another interest rate hike firmly on the table.

The RBA has already shown this year that it is prepared to lift rates if inflation remains too high.

If inflation stays around these levels, borrowers could be facing another interest rate hike over the coming months.

The post Inflation jumps back to 4%. Are more interest rate hikes coming? appeared first on The Motley Fool Australia.

More reading

• With $2.4 billion in FY26 profits, are Telstra shares a good buy today?
• This ASX biotech could rise almost 50%, Morgans says
• Why are Northern Star shares rocketing 8% on Wednesday?
• Commonwealth Bank vs ANZ: Which is better for passive income?
• 3 reasons why the Vanguard Australian Shares Index ETF (VAS) is a solid buy

Motley Fool contributor Aaron Teboneras has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.