I think that the two S&P/ASX 200 Index (ASX: XJO) shares I’m going to name in this article will be able to beat the market this year and over the long-term. Of course, that’s just my opinion and there’s no guarantee at all.

The ASX is home to some quality growth shares. But it’s also home to plenty of mature businesses with little growth prospects. You just need to find quality growth businesses at the right price.

Here are my two ASX 200 picks:

Brickworks Limited (ASX: BKW) 

Brickworks has been one of the most reliable businesses on the ASX over the past few decades. It hasn’t cut its dividend over the past 40 years and it’s steadily expanding its Australian building products offering with organic growth and acquisitions.

It also recently went into the US with three targeted acquisitions which have quickly made it the market leader in the north east of the US.

The defensive nature of Brickworks’ industrial property trust and holding of ASX 200 investment conglomerate Washington H. Soul Pattinson and Co. Ltd (ASX: SOL) shares are very attractive assets.

We’re now learning that cash grants of between $20,000 to $40,000 may be given to buyers of newly-constructed homes. The government is also apparently considering giving people cash for home renovations to help local tradies according to reporting by the Australian Financial Review. This would likely indirectly benefit Brickworks.

The diversified ASX 200 property business currently offers a grossed-up dividend yield of 5.3%.

A2 Milk Company Ltd (ASX: A2M)

There are few ASX 200 companies that can say they are growing strongly in both the US and China. Those two markets alone could support a much larger A2 Milk business.

A2 Milk has expertly created a brand known for quality and trustworthiness. It’s an offering that resonates with consumers who want a safe (and good-tasting) product.

The current coronavirus pandemic is causing consumers to load up on product, which is helping A2 Milk’s profit margins.

A2 Milk has pretty high profit margins so a healthy amount of the revenue goes straight to the bottom line. The ASX 200 business will soon be generating earnings from Canada with a licensing agreement. There are plenty of other countries for A2 Milk to expand into over time.

I believe there’s plenty more growth to come because A2 Milk is only just getting started in North America. Its huge cash balance could soon start to be used for shareholder returns or even fund an acquisition.

Foolish takeaway

I really like both Brickworks and A2 Milk as ASX 200 share picks. At the current prices I believe Brickworks is cheaper, but A2 Milk is likely to produce stronger returns over the next decade as the global expansion continues.

More reading

• Why a2 Milk, Freedom Foods, Scentre, & TPG Telecom are dropping lower
• Will the A2 Milk share price hit $20 in 2020?
• Got $50,000 to invest for income? Pick these 5 ASX dividend shares
• How you can get very rich with ASX 200 shares
• 10 top ASX growth shares to buy in June for strong returns

Motley Fool contributor Tristan Harrison has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of and has recommended Brickworks. 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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It wasn’t just Afterpay Ltd (ASX: APT) that was rocketing higher last month in the buy now pay later industry. One of its key rivals also surged higher.

In fact, the Zip Co Ltd (ASX: Z1P) share price was an even stronger performer. It finished the month with an impressive 57% gain.

Why did the Zip Co share price rocket higher in May?

Investors were buying Zip Co’s shares last month after it released a trading update for the month of April. That update revealed that the buy now pay later provider’s strong growth has continued during the pandemic.

For the month ending 30 April, Zip Co delivered an 81% increase in monthly revenue to $15.1 million. This was driven by an 86% lift in monthly transaction volume to $181.6 million and a 70,000 increase in customer number to 2 million.

The latter means the company’s customer numbers have grown 66% since the same period a year earlier. This was supported by a 50% year on year increase in merchant numbers to 23,100.

Another positive was its net bad debts, which came in at 1.99%. Management revealed that this is significantly outperforming the market. In a similar vein, Zip Co’s monthly arrears remained flat at 1.57%. This appears to have convinced the market that there will not be a spike in bad debts during the current crisis.

The company’s Managing Director and CEO, Larry Diamond, was rightfully pleased with its performance.

He said: “April was another very strong month for Zip, and in particular when considering the shutdown of a large portion of the economy. Our product differentiation and penetration into purchases for online, the home, and everyday spend categories, delivered robust transaction volume. Our revenue model has continued to deliver a strong result in the face of a challenging economic environment for retail more generally.”

Will there be more of the same for Zip Co shares in June?

It looks set to be an eventful month for the company in June.

This morning Zip Co requested a trading halt while it undertakes a capital raising to fund a proposed acquisition.

No details have been released regarding the acquisition, but if the market sees value in it then I wouldn’t be surprised to see its shares charge higher in June. But we’ll have to wait and see tomorrow or Wednesday when the company reveals all.

More reading

• 3 top Warren Buffett quotes to start your week right
• This ASX fintech share is up 489% since March
• Why Nearmap’s share price surged by 50% in May
• Openpay share price surges 29% higher after BNPL provider reports record month
• Real wealth from 3 roaring mid caps in May

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 ZIPCOLTD FPO. The Motley Fool Australia owns shares of AFTERPAY T FPO. 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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Looking to invest in quality S&P/ASX 200 Index (ASX: XJO) shares with strong long-term growth potential?

I think the following 3 ASX 200 shares are worthy candidates for above-average share price growth over the next 5 years. Each share also has a strong and proven business model across a range of markets.

Bapcor Ltd (ASX: BAP)

Bapcor is the leading second-hand auto parts distributor in Australia and New Zealand. Additionally, an expansion into Thailand is aimed at providing a launching pad to make headway in the Asian market.

I think its recent capital raising of $236 million from institutional and retail investors positions the company well to navigate through any prolonged downturn caused by the coronavirus pandemic. Bapcor also believes the capital raising puts it in a strong position to execute its 5-year growth strategy.

Weaker trading conditions were experienced in late March and early April. However, coronavirus restrictions are now easing. I believe trading is therefore likely to pick up again quicker than anticipated.

Domino’s Pizza Enterprises Ltd. (ASX: DMP)

Domino’s has an aggressive expansion plan. Assuming it executes well on this, I believe the plan positions Domino’s well for strong sales growth over the next 5 years.

Compared to other fast food outlets and restaurants, the company’s revenue base has proven to be fairly resilient during the coronavirus crisis so far.

In its most recent market update in late April, Domino’s revealed that its chain of stores in France were progressively reopening. Additionally, stores in Japan and Germany have maintained strong sales growth, while there has been minimal impact on trading in Australia.

Domino’s doesn’t typically have a sit-down service and any in-store pick-up by patrons is normally very quick. In addition, Domino’s has an extensive home delivery service which has experienced a surge in demand in response to lockdown restrictions.

Washington H. Soul Pattinson and Co. Ltd (ASX: SOL) 

I am attracted to ‘Soul Patts’ as a long-term investment. I like its high level of diversification across a broad range of industries, which range from pharmacies and telecommunications to mining and building products.

Soul Patts also keeps plenty of cash on its balance sheet. This places it in a strong position to capitalise on any investment opportunities that crop up. On the flip side, this cash can be used as a buffer in difficult operating times, such as those faced now.

Soul Patts funds its dividends from the cash it receives from its investment portfolio. The company expects this to be in line with the previous year, supporting its ability to maintain its stellar dividend record and pay a growing dividend in FY20.

More reading

• These ASX shares are set to get a big boost from the next big government stimulus
• These 5 ASX 200 shares were last week’s biggest winners
• Top brokers are urging you to buy these ASX shares today
• Leading brokers name 3 ASX 200 shares to buy right now
• The latest ASX 200 stocks to be upgraded by top brokers

Motley Fool contributor Phil Harpur owns shares of Bapcor and Domino’s Pizza Enterprises Limited. The Motley Fool Australia owns shares of and has recommended Bapcor and Washington H. Soul Pattinson and Company Limited. The Motley Fool Australia has recommended Domino’s Pizza Enterprises Limited. 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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