Category: Stock Market

Determining which companies can be classed as ‘top shares’ is very subjective. However, they could include businesses that have a competitive advantage, and that trade at fair prices given their financial outlooks.

Through buying a diverse range of them, it is possible to build a portfolio that can deliver attractive returns over the long run. With many opportunities to buy undervalued shares still available despite the recent stock market rally, now may be the right time to start the process of capitalising on today’s top stocks.

Defining which companies are top shares

Businesses with competitive advantages over their peers may be more likely to be classed as top shares. For example, they may have a unique product that means they can generate higher margins than their rivals. Or, they could have a lower cost base and stronger brand loyalty that lifts their financial performance over the long run.

Similarly, the most appealing shares may be those companies with solid balance sheets and strong cash flow. This point may be especially relevant at the present time, since the outlook for the economy continues to be very uncertain. Financially-sound businesses may be better able to overcome threats to economic growth caused by the coronavirus pandemic.

Meanwhile, top shares may be those companies that have all of the above attributes, but yet trade at low prices. Their low valuations may, for example, be caused by weaker recent performance that can be reversed over the long run. Or, investor sentiment towards their sector could be downbeat. This may present an opportunity to buy high-quality companies trading at low prices.

Building a portfolio of attractive stocks

Once top shares have been identified, building a portfolio of them can be a challenging task. After all, it is tempting to simply focus on a small number of the best ideas that are available at a given point in time. However, this may lead to high company-specific risk that means an investor is very reliant on a small number of holdings for their returns. Through buying a wider range of businesses, it may be possible to reduce overall risks.

Furthermore, holding some cash in case of a stock market crash can be a shrewd move. This does not mean that an investor relies on savings accounts for their returns. Rather, they have a limited amount of cash available so they can add more stocks to their portfolio should appealing opportunities come along in future. This may mean lower returns in the short run, but can provide greater opportunity to capitalise on the stock market cycle when seeking to buy top stocks.

Taking a long-term view

As ever, even top shares can experience periods of disappointment. Therefore, it is important to take a long-term view of any portfolio that contains equities. The track record of the global stock market shows that it can deliver attractive returns relative to other mainstream assets.

More reading

• Beach, Santos, & Woodside shares on watch after oil prices crash
• We’re betting on ASX growth shares: global fund
• 2 great ASX growth shares to buy
• Are COVID-19 vaccine worries affecting the CSL (ASX:CSL) share price?
• 2 high yield ASX dividend shares to buy today

Motley Fool contributor Peter Stephens 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 Bruce Jackson.

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It looks set to be a tough day for energy producers such as Beach Energy Ltd (ASX: BPT), Santos Ltd (ASX: STO), and Woodside Petroleum Limited (ASX: WPL) on Friday.

This follows a disappointing night of trade for oil prices which saw the price of both Brent and WTI crude oil crash lower.

What happened?

Oil prices sank for the fifth day in a row on Thursday night after a strengthening US dollar, a stuttering COVID-19 vaccine rollout, and rising US crude and fuel inventories weighed heavily on sentiment.

According to CNBC, the Brent crude oil price fell 7% to settle at US$63.28 per barrel and the WTI crude oil price settled 7.1% lower at US$60 per barrel.

In respect to inventories, on Wednesday the U.S. Energy Information Administration (EIA) revealed that U.S. crude inventories rose by 2.4 million barrels last week.

Where next for oil?

Tamas Varga from PVM Oil Associates told CNBC that he believes short term factors are weighing on prices and remains positive on oil for the longer term.  

He commented: “Short-term developments – stuttering vaccine rollouts and the build in U.S. oil inventories – are driving sentiment, but the longer-term oil outlook is still encouraging. Yesterday’s U.S. Federal Reserve meeting provided a boost to equities … U.S. economic growth has been revised upwards while unemployment is expected to decline.”

One spot of good news for oil prices this morning is that European regulators have found that the AstraZeneca COVID-19 vaccine is not linked to overall increased risk of blood clots.

There were fears that the suspension of this vaccine globally could lead to a return to lockdowns in some regions, tempering expectations for a recovery in fuel use. So, with its rollout likely to restart now, fuel demand could continue its recovery in the coming months.

More reading

• 5 things to watch on the ASX 200 on Friday
• Hydrogen far from ‘fool cells’: EV trends and the major ASX players
• 5 things to watch on the ASX 200 on Thursday
• 5 things to watch on the ASX 200 on Wednesday
• 5 things to watch on the ASX 200 on Tuesday

Motley Fool contributor James Mickleboro 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 Bruce Jackson.

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One global investment house has announced it is going contrary to the current market trend.

The investment committee for T Rowe Price Group Inc (NASDAQ: TROW)‘s Australian arm this week revealed its latest allocation strategy.

Globally, share markets have been shifting to value stocks in light of higher bond yields, possible inflation, higher interest rates and post-COVID lifestyles. The S&P ASX All Technology Index (ASX: XTX) has lost nearly 14% since 10 February.

But despite this — or perhaps because of it — T Rowe Price is backing two categories of stocks:

Australia is looking good

The T Rowe Price committee acknowledged the market’s anxiety about higher interest rates.

But the group maintained high rates were “likely far” away.

“Central banks made it pretty clear that they want low yields to be maintained. For this reason we are skeptical about the ability for interest rates to derail the recovery,” the committee reported.

“Recent actions taken by the Reserve Bank of Australia to buy government bonds to bring down long-term interest rates are a strong indication that monetary policy will remain accommodative.”

And with the economy recovering strongly as shown in this week’s positive unemployment numbers, the committee is optimistic about the Australian equities market.

“[Company] earnings are following through, benefitting from high commodity prices and record low yields,” stated the T Rowe Price report.

“The economic momentum is firing on all cylinders, evidenced by the economic surprise index at record high levels.”

Growth shares are looking good

While the market is rotating hard to value stocks, the T Rowe Price committee thinks now is the time to turn to growth.

“We have tilted portfolio positioning towards more domestic exposures to reflect the stronger economic performance of the Australian economy and also expect growth stocks to continue to do well in a contained yield environment,” it reported.

The advice backs up DeVere Group chief executive Nigel Green’s warning earlier this week to avoid the “rotation trap” — that is, don’t go overboard dumping quality growth stocks.

“The danger is the massive hype surrounding rotation from growth stocks – those expected to grow sales and earnings at a faster rate than the market average – into value stocks,” he said.

“Does anyone suddenly seriously think Amazon.com Inc (NASDAQ: AMZN), Alphabet Inc (NASDAQ: GOOGL) (NASDAQ: GOOG) and Tesla Inc (NASDAQ: TSLA) are not companies of the future also?”

T Rowe Price Australia is taking the profit earned on value shares it rotated to last year, and ploughing the cash back into growth.

“We remain well positioned in Australia in cyclical growth, recovery growth and high-quality stocks we believe will benefit as economic conditions continue to improve,” the committee stated.

“To fund these portfolio changes we have taken profit on defensive growth names and somewhat reduced exposure to offshore earners.”

Similarly, the committee was optimistic on Japanese and emerging market stocks. It reported the golden growth from the US tech sector seen in 2020 would not repeat this year.

The T Rowe Price Australia investment committee consists of the following experts:

• Richard Coghlan, multi-asset portfolio manager
• Randal Jenneke, head of Australian equities
• Thomas Poullaouec, head of multi-asset solutions Asia-Pacific
• Wenting Shen, multi-asset solutions strategist
• Scott Soloman, associate portfolio manager, fixed income division

More reading

• Don’t fall into the ‘rotation trap’
• How to invest in the Nasdaq Index on the ASX
• Elon Musk reviews title and decides ‘Technoking of Tesla’ is more fitting
• ASX investors still can’t get enough of GameStop (NYSE:GME) shares
• Could this have moved the News Corp (ASX:NWS) share price today?

John Mackey, CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool’s board of directors. Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool’s board of directors. Tony Yoo owns shares of Alphabet (A shares) and Amazon. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and recommends Alphabet (A shares), Alphabet (C shares), Amazon, and Tesla and recommends the following options: long January 2022 $1920 calls on Amazon and short January 2022 $1940 calls on Amazon. The Motley Fool Australia has recommended Alphabet (A shares), Alphabet (C shares), and Amazon. 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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ASX growth shares can be good ideas to think about because they may be able to generate good long-term returns.

Businesses that can generate good profit growth and re-invest strongly into the business can lead to good shareholder returns. 

These two ASX growth shares could be good considerations:

Australian Ethical Investment Limited (ASX: AEF)

Australian Ethical is a fund manager that aims to offer a range of investment strategies that aim to invest in businesses that are doing good for the world and the environment.

The company boasts that it has been named as one of just six global leaders, out of 40, for ESG commitment by Morningstar. It was the only asset manager in Australia to receive this recognition.

There are three pillars to its investments. Regarding the planet, every decision is made with empathy and compassion for the planet and all those that inhabit it. Regarding people, Australian Ethical says that environmental and social concerns need to be given equal weight to financial outcomes. Finally, with regards to animals, it doesn’t invest in anything that’s unnecessarily harmful to animals.

The ASX growth share is seeing good levels of funds under management (FUM) inflows as well as solid investment performance.

In the result for the period ending 31 December 2020, FUM had grown to $5.05 billion – an increase of 30%. The ASX growth share saw record net inflows of $422 million (up 43%) and customer numbers were up 22% year on year.

Australian Ethical generated underlying profit after tax (UPAT) of 11% to $4.9 million and statutory profit went up 17% to $5.2 million. This allowed the board to increase the dividend by 20% to 3 cents per share.

The company continues to invest in growth initiatives, with $1.7 million of expenditure in the first half.

VanEck Vectors Morningstar Wide Moat ETF (ASX: MOAT)

This could be one of the highest-quality exchange-traded funds (ETFs) on the ASX. The ASX growth share aims to invest in businesses, chosen by Morningstar equity analysts, that are believed to have sustainable competitive advantages, or wide economic moats.

Businesses with moats essentially mean that they’re hard to dislodge by competition. Imagine how much you’d have to spend to make a smartphone that people would buy rather than an Apple or Samsung one.

But this isn’t just a passive index. The holdings are businesses that are trading at attractive prices relative to Morningstar’s estimate of fair value. But it doesn’t come with an expensive active management price tag. The annual management fee is just 0.49% per annum.

All of the holdings in the ETF’s portfolio are listed in the US, but some of the names generate earnings from right across the world.

There are around 50 positions. Whilst there are names like Amazon.com, Alphabet and Microsoft in the portfolio, the top 10 holdings are not the typical largest positions in an ETF including: Charles Schwab, Wells Fargo, Corteva, Bank of America, US Bancorp, Boeing, Cheniere Energy, Intel, John Wiley & Sons and Blackbaud.

More reading

• Why VanEck Vectors Morningstar Wide Moat ETF (ASX:MOAT) could be the best ETF
• 2 high quality ASX ETFs to buy this month
• Brace for even more new ETFs to hit the ASX
• 2 top ETFs to buy in March
• Here’s why the Australian Ethical (ASX:AEF) share price is crashing 10% lower

Tristan Harrison has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of Australian Ethical Investment Ltd. The Motley Fool Australia has recommended Australian Ethical Investment Ltd. and VanEck Vectors Morningstar Wide Moat ETF. 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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Investors may be anxious that the CSL Limited (ASX: CSL) share price could fall further on current COVID-19 vaccine worries. This comes as several European countries recently suspended the use of the Oxford-AstraZeneca vaccine after receiving reports of individuals developing blood clots.

Below we take a look at whether concerns over the vaccine could be impacting the CSL share price.

Is the COVID-19 vaccine safe?

According to AstraZeneca, around 17 million people have been vaccinated with its product across Europe and the United Kingdom. While some mild side effects are expected such as tiredness and aching muscles, a reported 37 people formed blood clots. In addition, there were 15 cases of deep vein thrombosis, and 22 cases of pulmonary embolism.

Overall, the Oxford-AstraZeneca vaccine has proved relatively safe when comparing these cases against the overall larger group. However, a number of European countries such as Germany, France, Italy, Sweden, Spain and others have paused administering the vaccine.

These nations called for an assessment from the European Medicines Agency (EMA) to see if there was a link between the vaccine and the reported side effects. So far, the EMA has found no evidence and looks set to recommend the continued rollout of the Oxford-AstraZeneca vaccine.

At home, Australia is pushing ahead to distribute its current stockpile of COVID-19 vaccines. The government has secured an order of 3.8 million doses which is set to be fulfilled in early 2021, with over 226,000 doses having already been administered. The other 50 million doses will be manufactured in Melbourne by CSL on behalf of AstraZeneca.

How important is this to CSL?

Interestingly, analysts have stated that CSL’s vaccine deal won’t deliver any meaningful earnings for the company when compared to other biotech companies. This is because CSL’s exposure to vaccines is considered quite low against its other performing business units. In its FY21 half-year results, CSL’s pandemic business contributed just $77 million in revenue to the group’s entire $5,739 million.

Furthermore, the company noted that the production of 50 million doses will not have any significant material impact on future revenue.

CSL shares have been hammered since late 2020 due to weak investor confidence. But nonetheless, the business still continues to grow at an impressive rate, up 15% on revenue from H1 FY20 to H1 FY21. As such, it seems market fear is the primary force continuing to weigh down its shares.

CSL share price performance

Over the past 12 months, the CSL share price is down around 5%, and almost 10% year to date. The company’s shares reached a 52-week high of $332.68 last April before hitting a recent low of $242.00 this month.

More reading

• 2 strong blue chip ASX shares rated as buys by brokers
• Bring your portfolio to life with these fantastic ASX healthcare shares
• Temperature check: How is the CSL (ASX:CSL) share price faring today?
• 3 beaten down ASX shares that could be great value
• Share market on watch over AstraZeneca vaccine fears

Aaron Teboneras owns shares of CSL Ltd. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of CSL Ltd. 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 Bruce Jackson.

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If you’re interested in bolstering your portfolio with some dividend shares, then the two listed below could be worth considering.

Here’s what you need to know about these ASX dividend shares:

Aventus Group (ASX: AVN)

Aventus is a fully integrated owner, manager, and developer of large format retail centres. Unlike many other retail landlords, it has been performing very positively over the last 12 months. This has been driven by its exposure to the household goods sector and everyday needs.

Solid demand for its properties and strong rental collections ultimately led to Aventus’ funds from operations (FFO) increasing 6.5% to $55.9 million during the first half. Positively, more of the same is expected in the second half.

This went down well with Goldman Sachs, which reiterated its buy rating and $3.04 price target on its shares. The broker is also forecasting a 16.6 cents per share full year dividend. Based on the latest Aventus share price of $2.86, this represents a very attractive 5.8% dividend yield.

Rural Funds Group (ASX: RFF)

Rural Funds is the owner of a diverse portfolio of high quality agricultural assets across five sectors: almonds, cattle, vineyards, cropping and macadamias. These assets are leased on ultra long term leases to highly experienced operators such as Select Harvests Limited (ASX: SHV) and Treasury Wine Estates Ltd (ASX: TWE).

Last month the company released its half year update and revealed a result in line with expectations. This means the company is on course to deliver on its FY 2021 distribution guidance of 11.28 cents per share. In addition to this, management revealed its distribution plans for next year. It intends to increase its distribution by its target rate of 4% to 11.73 cents per share.

Based on the current Rural Funds share price, this will mean yields of 4.7% and 4.9%, respectively.

More reading

• 2 top ASX dividend shares to buy for your income portfolio
• 2 high yield ASX dividend shares to buy next week
• Why Flight Centre, Northern Star, Southern Cross Media, & Treasury Wine are sinking
• Top brokers name 3 ASX shares to sell today
• This ASX dividend share has a very generous 5.9% yield

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of and has recommended RURALFUNDS STAPLED and Treasury Wine Estates Limited. The Motley Fool Australia has recommended AVENTUS RE UNIT. 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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On Thursday the S&P/ASX 200 Index (ASX: XJO) was out of form again and dropped lower. The benchmark index fell 0.7% to 6,745.9 points.

Will the market be able to bounce back from this on Friday? Here are five things to watch:

ASX 200 to fall

The Australian share market looks set to end the week on a disappointing note. According to the latest SPI futures, the ASX 200 is expected to open the day 34 points or 0.5% lower this morning. This follows a poor night on Wall Street, which in late trades sees the Dow Jones down 0.2%, the S&P 500 down 1.1%, and the Nasdaq sinking 2.5% lower. Rising bond yields have spooked investors again.

ASX 200 tech shares under pressure

It looks set to be a difficult end to the week for Australian tech shares such as Afterpay Ltd (ASX: APT) and Appen Ltd (ASX: APX) on Friday. This follows another selloff of US tech stock overnight after US treasury yields surged higher. According to CNBC, the 10-year Treasury yield surged to 14-month high of 1.75% and the 30-year rate topped 2.5%. Given how the local tech sector tends to follow the Nasdaq’s lead, which is down 2.5%, this doesn’t bode well for today’s trading session.

Oil prices crash

Energy producers including Santos Ltd (ASX: STO) and Woodside Petroleum Limited (ASX: WPL) are likely to end the week deep in the red after oil prices crashed lower overnight. According to Bloomberg, the WTI crude oil price is down 8.1% to US$59.34 a barrel and the Brent crude oil price has fallen 8% to US$62.56 a barrel. A rising US dollar, a build-up of US crude and fuel inventories, and concerns over a stuttering vaccine rollout were behind the decline.

Gold price rises

Gold miners Newcrest Mining Ltd (ASX: NCM) and St Barbara Ltd (ASX: SBM) will be on watch after a positive night of trade for the gold price. According to CNBC, the spot gold price is up 0.4% to US$1,733.90 an ounce. The precious metal rose despite bond yields hitting new 14-month highs.

Webjet shares given buy rating

The Webjet Limited (ASX: WEB) share price could be going higher from here according to Goldman Sachs. Following its investor update yesterday, the broker has reiterated its buy rating and $7.36 price target. Goldman notes that Webjet is aiming to grow its WebBeds business materially more than it was forecasting. It notes management’s target of a TTV of $10 billion, compared to its forecast of $3.9 billion.

More reading

• 2 ASX growth shares for smart investors to buy
• ASX 200 drops, Webjet reveals B2B plan, Cimic wins again
• Top brokers name 3 ASX shares to sell today
• Hydrogen far from ‘fool cells’: EV trends and the major ASX players
• Afterpay (ASX:APT) share price drops on scathing broker note

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 Appen Ltd. The Motley Fool Australia owns shares of and has recommended Webjet Ltd. The Motley Fool Australia owns shares of AFTERPAY T FPO. 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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If you’re searching for ASX shares to add to your portfolio, then it could be worth considering the ones listed below.

Here’s what you need to know about them:

Aristocrat Leisure Limited (ASX: ALL)

The first ASX share to consider is Aristocrat Leisure. With casinos around the world now reopening, demand for this gaming technology company’s industry-leading poker machines looks set to rebound strongly in the near future. In the meantime, its increasingly important Digital business has been growing strongly and is now generating material recurring revenues. When these two businesses are finally pulling together, its earnings growth is likely to accelerate.

Analysts at Morgan Stanley believe it is worth sticking with the company. They currently have an overweight rating and $38.00 price target on its shares.

Goodman Group (ASX: GMG)

Another ASX share to consider buying is Goodman Group. This integrated commercial and industrial property group owns a high quality portfolio of assets across a number of countries and industries. The main attraction, however, is that many of its assets have exposure to structural tailwinds such as ecommerce. In light of this, they look likely to be in demand for a long time to come. As a result, Goodman looks to be well-placed to continue delivering strong rental income and distribution growth over the next decade and beyond.

Macquarie recently upgraded Goodman’s shares to an outperform rating with an improved price target of $20.39.

Pushpay Holdings Group Ltd (ASX: PPH)

A final option to consider buying is Pushpay. It is a fast-growing donor management platform provider for the faith and not-for-profit sectors. Unlike Aristocrat Leisure, business has been booming for Pushpay during the pandemic. The temporary closure of churches, social distancing, and the shift to a cashless society have increased demand for its platform this year. So much so, management is expecting more explosive growth in FY 2021.

Goldman Sachs has a conviction buy rating and $2.59 price target on its shares.

More reading

• This ASX company has increased or maintained dividends for 44 years
• Top brokers name 3 ASX shares to buy today
• Leading brokers name 3 ASX shares to sell today
• These 2 ASX shares are the newest “buy” ideas from top brokers
• 2 ASX shares that are rapidly growing

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 PUSHPAY FPO NZX. The Motley Fool Australia has recommended PUSHPAY FPO NZX. 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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The Qantas Airways Ltd (ASX: QAN) share price is back in focus following last week’s federal government announcement of a $1.2 billion tourism package. The taxpayer-funded deal entails half-price domestic airfares for 800,000 passengers.

Another part of the package is retention payments to Qantas and Virgin employees who would normally be working in the international flight segment of the business. Although previously undisclosed, Qantas has this afternoon confirmed further details.

At the close of trade today, the Qantas share price was trading down 0.73% at $5.41. 

Retention life raft replaces JobKeeper

Qantas confirmed further details of the JobKeeper replacement with The Australian Financial Review today. Australia’s largest airline stated that workers in the international business will receive $500 per week to replace the soon-to-be phased out JobKeeper.

Payments are set to start from the end of this month. Around 8,600 workers will rely on the payment as international borders remain closed. The payments are set to be carried out until the end of October, which the government hopes will mark the restart of international travel.

Whether this program will be enough relies heavily on the COVID-19 vaccine rollout. Putting added pressure on the government, news broke earlier in the week of some countries halting rollouts. Reportedly, 16 European countries suspended the use of the AstraZeneca plc (LON: AZN) vaccine over fears it may cause blood clots in some recipients.

The government is also hoping everything opens up and is back in full swing sooner rather than later. The reason being Australia’s large deficit is now risking the country’s sovereign AAA credit rating.

Qantas share price recap

The Qantas share price has increased by nearly 90% in the last year. However, this is mostly down to how hard the share was originally hit by the pandemic.

The airline’s share price is yet to return to its pre-pandemic highs. This seems logical given that passenger numbers are also still below the heights experience before COVID.

In Qantas’ results for the half-year ended December, revenue was down a staggering 75%. Despite a strong focus on reducing expenses, the airline still reported a blowout loss of more than $1 billion.

Moving forward, shareholders will have their fingers and toes crossed for the vaccine rollout to move along. The faster immunisations are completed, the sooner people can plan their next getaway outside of Australia.

More reading

• Revealed: 4 least profitable industries in Australia
• Qantas (ASX:QAN) holds 74% of domestic flight market
• Share market on watch over AstraZeneca vaccine fears
• The Flight Centre (ASX:FLT) share price is up 40% in six months: Can it go higher?
• Leading brokers name 3 ASX shares to buy today

Motley Fool contributor Mitchell Lawler 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 Bruce Jackson.

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If you’re looking to invest in a growth share or two, then you might want to consider the ones listed below.

Here’s why these ASX shares could be top options for growth investors looking at long term options:

Afterpay Ltd (ASX: APT)

Afterpay could be a great buy and hold option for investors. This is thanks to its leadership position in the rapidly growing buy now pay later (BNPL) industry and its expansion into other financial products.

In respect to the former, Afterpay is a leader in the Australia, UK, and US BNPL markets. It has also just completed its acquisition of Pagantis in Europe, allowing it to commence its rollout in the region. But it doesn’t stop there. A couple of small acquisitions in Asia means that an expansion in this potentially lucrative region could be on the cards in the near future.

As for the expansion of its product offering, very shortly Afterpay will begin offering banking products such as transaction accounts via the Afterpay Money app. There is even speculation that it could expand into other products such as personal loans and mortgages in the future. 

It is partly for this reason that Bell Potter is so positive on the company. According to a recent note, the broker has a buy rating and and $168.50 price target on Afterpay’s shares.

Domino’s Pizza Enterprises Ltd (ASX: DMP)

Another ASX growth that could be a top buy and hold investment option is Domino’s. This pizza chain operator’s half year result was arguably the highlight of earnings season last month.

Strong demand for its pizzas in the ANZ, European, and Japanese markets underpinned very strong sales growth. And thanks to operating leverage, its profits grew at an even stronger rate. 

Pleasingly, management is expecting an even stronger performance during the second half, which is likely to lead to a bumper profit result in August.

The good news is that Domino’s growth isn’t anywhere near ending. In fact, at the end of the first half the company had a network of 2,800 stores. It is now aiming to double the size of this in the coming years. And that’s just from its existing markets, the company is looking for acquisitions and could expand into new territories in the future to give it an even larger growth runway.

Analysts at Goldman Sachs are very positive on the company’s future. As a result, the broker recently put a buy rating and $112.60 price target on its shares.

More reading

• Top brokers name 3 ASX shares to sell today
• Afterpay (ASX:APT) share price drops on scathing broker note
• Why the Afterpay (ASX:APT) share price is down 7% in 2021
• Revealed: 4 least profitable industries in Australia
• Is the new CBA BNPL service bad news for Afterpay and Zip shares?

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of AFTERPAY T FPO. The Motley Fool Australia has recommended Dominos Pizza Enterprises 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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