If you’re looking to add a few growth shares to your portfolio, then I think the ones listed below would be great options.
They all look well-positioned for growth over the next decade and could generate outsized returns for investors. Here’s why I like them:
a2 Milk Company Ltd (ASX: A2M)
The first growth share I would urge you to consider buying is a2 Milk Company. This leading fresh milk and infant formula company has consistently grown its earnings at a strong rate over the last few years thanks to the expansion of its fresh milk footprint and the insatiable demand for its infant formula in China. Given how its fresh milk footprint continues to expand and its infant formula still only has a modest market share, I believe there’s plenty more to come from a2 Milk Company. Another positive is its burgeoning cash balance. At the end of the first half it had NZ$618.4 million of cash. I suspect these funds could be used for earnings accretive acquisitions in the future.
NEXTDC Ltd (ASX: NXT)
The second growth share to consider buying is NEXTDC. I believe the data centre operator has the potential to be a long term market beater. This is because it is perfectly positioned to capitalise on the ever-increasing amount of data being generated by consumers and businesses. This consumption will only increase in the future as more software moves to the cloud and 5G internet adoption grows. As a result, I expect demand for capacity at its world class centres will be strong for many years to come.
Pushpay Holdings Group Ltd (ASX: PPH)
A final growth share to consider buying is Pushpay. It is a fast-growing donor management platform provider for the faith and not-for-profit sectors. While this is a niche market, it is certainly a very lucrative one. For example, the company recently released its full year results and revealed operating revenue of US$127.5 million and operating earnings of US$25.1 million. Both were up very strongly year on year. Looking to the future, management is targeting a 50% share of the medium to large church market. This represents a US$1 billion revenue opportunity. Given the quality of its offering, I believe it can achieve this and drive strong returns for investors.
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More reading
- How to reduce your work to part-time using ASX shares
- Why this ASX infrastructure company could help protect your portfolio in a downturn
- 2 ASX stocks that could replace cash
- Where growth, income, and value investors can invest right now
- 3 shares I’d buy if the coronavirus selloff gets worse
Motley Fool contributor James Mickleboro owns shares of NEXTDC Limited. The Motley Fool Australia owns shares of and has recommended PUSHPAY FPO NZX. The Motley Fool Australia owns shares of A2 Milk. 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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