I think there are a number of S&P/ASX 200 Index (ASX: XJO) growth shares that are worth buying at the moment.

Some ASX technology shares have done very well over the past year such as Afterpay Ltd (ASX: APT). Whilst the buy now, pay later sector isn’t on my radar right now, there are shares that looking very compelling:

A2 Milk Company Ltd (ASX: A2M)

A2 Milk could be the best ASX 200 share to buy right now. It has very strong international growth aspirations with a good presence in China and a growing position in the US.

In FY20 alone the company more than doubled its China label infant nutrition sales to NZ$337.7 million with USA milk revenue growth of 91.2%. I think both of these markets have very promising growth potential for the company over the next few years because A2 Milk continues to expand its store distribution.

A2 Milk is one of the few ASX shares that is doing well in both the USA and China. Just doing well in one of those markets can transform a business into a much larger entity.

I believe that the ASX 200 share has many years of good growth to come. In FY20 alone it grew revenue by 33% to NZ$1.73 billion.

Since 30 July 2020, the A2 Milk share price has dropped 18%. That means it’s now trading at 24x FY23’s estimated earnings.

Ingenia Communities Group (ASX: INA)

The ASX 200 share describes itself as a leading Australian property group that owns, operates and develops a growing portfolio of lifestyle and holiday communities across key urban and coastal markets.

It’s the holiday segment that is particularly interesting to me about the ASX share at the moment. It has a variety of caravan, camping and cabin accommodation throughout coastal and inland New South Wales and Queensland.

In FY20 its performance was resilient despite the bushfires and COVID-19 impacts. Revenue increased by 7% to $244.2 million, earnings before interest and tax (EBIT) went up 17% to $71.9 million and underlying earnings per share (EPS) grew 5% to 22.1 cents.

With international travel blocked for Aussies, there could be a lot more people visiting those holiday locations which could be a shorter-term (or long-term?) boon for the ASX 200 share. It doesn’t have any holiday parks in Victoria.

Its acquisition pipeline remains “strong” with a solid balance sheet.

Brickworks Limited (ASX: BKW)

Brickworks is currently having a tough time due to COVID-19. Construction activity is obviously lower because of the economic and restriction impacts over the last six months.

However, I think that things may change over the next year as pent-up demand leads to a resurgence in building across most of the country.

Brickworks produces and sells a number of products like bricks, roofing, paving and masonry in Australia. It’s quite connected to the Australian property market. If there is a property price resurgence as Westpac Banking Corp (ASX: WBC) predicts, then Brickworks could be a major beneficiary.

I also think Brickworks is an attractive ASX 200 share because of its defensive assets. It owns around 40% of old investment conglomerate Washington H. Soul Pattinson and Co. Ltd (ASX: SOL) which has investments in a variety of industries including telecommunications, property, resources, pharmacies and agriculture.

The ASX 200 share also owns 50% of an industrial property trust which has exciting growth potential. The trust is constructing two large distribution warehouses – one each for Amazon and Coles Group Limited (ASX: COL). These facilities will be among the best and most technologically advanced in the country.

At the current Brickworks share price it’s trading at 11x FY21’s estimated earnings. It also has a grossed-up dividend yield of around 4.4%.

Foolish takeaway

Each of these ASX 200 shares seem like really good investment ideas to me at the current prices. Brickworks seems like a solid dividend idea whilst A2 Milk is the best value growth business in my opinion. With Ingenia, I’m not sure how long the domestic travel boost will go for.

More reading

• ASX technology stocks to buy during this global tech sell-off
• 5 things to watch on the ASX 200 next week
• How to generate $1,000 a month in dividends
• These were the best performing ASX 200 shares last week
• These were the worst performing ASX 200 shares last week

Motley Fool contributor Tristan Harrison owns shares of Washington H. Soul Pattinson and Company Limited. The Motley Fool Australia owns shares of and has recommended Brickworks and Washington H. Soul Pattinson and Company Limited. The Motley Fool Australia owns shares of A2 Milk, AFTERPAY T FPO, and COLESGROUP DEF SET. 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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The Telstra Corporation Ltd (ASX: TLS) share price could be in the buy zone according to one leading broker.

Although Goldman Sachs has taken the telco giant off its conviction buy list, its analysts still have a regular buy rating and $3.60 price target on its shares. This price target implies potential upside of over 27% for the Telstra share price excluding dividends.

But why is the broker positive on Telstra? It has named four reasons it believes that the company’s shares are a buy at the current level. They are summarised below:

Mobile revenue growth.

The first is the arrival of 5G internet, which it believes will bring about an inflection in mobile revenues. This should be supported by the return of roaming revenues in FY 2022 once the pandemic passes and international travel resumes.

The broker explained: “A mobile inflection is approaching in 2H21 with ARPU growth to accelerate in FY22 given the 5G price changes and roaming recovery. Mobiles is the most important segment for Telstra (53% of FY21 underlying EBITDA), so ARPU growth is critical to drive ROIC higher. Positive ARPU inflections also typically drive share price outperformance (+2.6% / +5.5% alpha in subsequent 30/180 days).”

Cost saving opportunities.

A second reason to be positive is Telstra’s cost savings opportunities beyond its ongoing T22 strategy.

It said: “We expect significant productivity savings to continue past FY22, as TLS benefits from the accelerated Covid-19-driven digitization and continued reductions in the estimated $1bn in legacy fixed network costs.”

Generous dividend yield.

Another reason it is positive on the company is its generous dividend yield. Like myself, the broker believes that Telstra can maintain its dividend at 16 cents per share in FY 2021.

“Although DPS risk has increased post FY20 results, we still believe that 16c can be sustained, supported by FCF which will improve from an FY21 trough. Irrespective, given global yield compression, TLS could pay a dividend of 12c and still trade in line with its historical yield gap (to 10Y AU Bonds).”

Unlocking infrastructure value.

A final reason to be bullish on Telstra is the underappreciated value of its infrastructure.

Goldman said: “We continue to see compelling Infrastructure in Telstra, particularly the $1bn p.a. in risk-free NBN recurring payments. We estimate that InfraCo could be worth $38bn, implying RetailCo is trading on just 2.1X FY23 EV/EBITDA. Although unlikely to be a near term catalyst, at its Nov 12th Investor day, the ‘next steps towards potential monetisation’ will be outlined.”

Should you invest?

I completely agree with Goldman Sachs and believe the recent weakness in the Telstra share price is a gift for investors. This is particularly the case for income investors in this low interest rate environment.

More reading

• Telstra (ASX:TLS) share price hits a 52-week low: Is this a buying opportunity for investors?
• Interest rates to stay low for years? Buy these ASX dividend shares
• 2 top ASX dividend shares I would buy for income this week
• 3 retirement myths you can’t afford to believe
• The best ASX blue chip shares to buy after the market selloff

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of and has recommended Telstra 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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Technology darlings have been leading the global market sell-off and have put investors on edge. But the shake-up may be an opportunity to buy these two ASX tech stocks.

Don’t mind the noise even as our S&P/ASX 200 Index (Index:^AXJO) is poised to open weaker after stocks like Apple Inc. (NASDAQ: AAPL) and Alphabet Inc Class C (NASDAQ: GOOG) pushed US indices to a six-week low.

Rapid P/E re-rating makes tech stocks vulnerable

Hot technology stocks on the ASX have also come off the boil recently as investors question the lofty premiums that the sector is trading at.

In fact, the very strong outperformance of ASX tech stocks since the outbreak of the COVID-19 pandemic is driven by a price-earnings (P/E) re-rating.

As the chart from UBS below shows, the share price rally from the likes of the Afterpay Ltd (ASX: APT) share price and its friends, isn’t driven by earnings growth.

What does P/E expansion mean

It is the anticipation of future growth that is convincing investors to pay more for these stocks than they would have otherwise before COVID-19.

In other words, the expanding P/E means investors are paying more for each dollar of earnings. Tech stocks in both Australia and the US are priced for perfection, and any setback will trigger a sharp sell-off.

But there’s a small handful of tech stocks that are outperforming due more to earnings growth than the P/E re-rating.

The best ASX tech stocks to buy in this sell-off

One example it the Appen Ltd (ASX: APX) share price. UBS estimates that earnings per share (EPS) growth accounted for nearly 80% of the share price performance of the machine learning and artificial intelligence company.

Appen isn’t alone. The Nanosonics Ltd. (ASX: NAN) share price is much in the same boat, even though Nanosonics is not quite an IT but a medical technology stock.

But we are splitting hairs here. The more relevant detail is that earnings growth accounted for 54% of Nanosonics share price performance in the last two years.

For this reason, UBS put the two stocks into its “preferred list” of ASX stocks to buy. At least from a risk perspective, the two stocks are technically less vulnerable to a P/E de-rating.

More reading

• 5 things to watch on the ASX 200 next week
• These were the best performing ASX 200 shares last week
• Is it time to save more or invest more in ASX shares?
• These were the worst performing ASX 200 shares last week
• ASX 200 drops 0.3%, gold miners keep rising

Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool’s board of directors. Brendon Lau has no position in any of the stocks mentioned. Connect with me on Twitter @brenlau.

The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and recommends Alphabet (C shares) and Apple. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of Nanosonics Limited. The Motley Fool Australia owns shares of AFTERPAY T FPO and Appen Ltd. The Motley Fool Australia has recommended Alphabet (C shares), Apple, and Nanosonics 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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Last week saw a large number of broker notes hitting the wires once again. Three buy ratings that caught my eye are summarised below.

Here’s why brokers think investors ought to buy them next week:

Evolution Mining Ltd (ASX: EVN)

According to a note out of Credit Suisse, its analysts have upgraded this gold miner’s shares to an outperform rating with an improved price target of $6.55. The broker made the move after lifting its gold price forecasts for 2021 and 2022. Credit Suisse is expecting the price of the precious metal to stay higher for longer. It expects it to command a price of US$2,500 an ounce next year and then US$2,200 an ounce in 2022. This will make Evolution highly profitable given its low cost operations. I think Credit Suisse makes some great points. If the gold price does climb to these levels then Evolution would be a standout pick.

JB Hi-Fi Limited (ASX: JBH)

A note out of the Macquarie equities desk reveals that its analysts have upgraded this retailer’s shares to an outperform rating and increased the price target on them to $53.70. The broker notes that consumer spending has been strong in the current quarter. This is likely to mean JB Hi-Fi has been performing very positively so far in FY 2021. Furthermore, it expects this to continue over the remainder of the calendar year and be supported by new phone releases from Apple. While it isn’t my favourite retail share, I think it could be a good option for investors.

Vocus Group Ltd (ASX: VOC)

Analysts at Goldman Sachs have put this telco on their conviction buy list with an improved price target of $4.70. It likes Vocus as it is the only telco forecasting growth in FY 2021. In addition to this, it sees opportunities for the company to crystallise value by offloading non-core assets such as Vocus Energy. I think Goldman makes some good points and Vocus could be worth considering.

More reading

• These were the best performing ASX 200 shares last week
• ASX 200 drops 0.3%, gold miners keep rising
• 5 things to watch on the ASX 200 on Friday
• 5 things to watch on the ASX 200 on Thursday
• Brokers upgraded JB Hi-Fi (ASX:JBH) share price and this other ASX stock to “buy” today

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. 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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Once again, a large number of broker notes hit the wires last week. Some of these notes were positive and some were bearish.

Three sell ratings that caught my eye are summarised below. Here’s why top brokers think investors ought to sell these shares next week:

IGO Ltd (ASX: IGO)

According to a note out of Ord Minnett, its analysts have retained their sell rating and cut the price target on this nickel producer’s shares to $3.50. The broker isn’t a fan of IGO due largely to its belief that its assets are declining in quality. It also notes that the company’s outlook over the coming years is rather subdued. The IGO share price ended the week at $4.57.

Spark New Zealand Ltd (ASX: SPK)

Analysts at Goldman Sachs have retained their sell rating and $4.00 price target on this telco’s shares. Based on its outlook and current share price, Goldman believes that Spark is one of the most expensive incumbent telecommunication companies globally. In light of this, it sees no reason to buy its shares ahead of other more attractively priced peers. The Spark share price closed the week at $4.25.

Xero Limited (ASX: XRO)

A note out of UBS reveals that its analysts have retained their sell rating but lifted their price target on this business and accounting software platform provider’s shares to $72.00. According to the note, UBS believes there’s a lot to like about Xero. It notes that a recent survey shows that Xero is highly regarded by accountants and cloud accounting penetration growth remains solid. However, due to its valuation and concerns over higher than normal business closures because of the pandemic, the broker retains its sell rating. The Xero share price ended the week notably higher than this price target at $92.12.

More reading

• ASX 200 down 0.1%: Tech shares push higher, AMP (ASX:AMP) sinks lower
• 2 fantastic ASX growth shares to buy with $2,000 today
• ASX 200 rises 1%, SEEK (ASX:SEK) jumps 9%
• Buy and hold these ASX shares to grow your wealth
• Apple, Amazon, Microsoft are bigger than EVERY unicorn combined

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 Xero. The Motley Fool Australia has no position in any of the stocks mentioned. 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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Last week the S&P/ASX 200 Index (ASX: XJO) bounced back from a heavy decline a week earlier with the smallest of weekly gains. The benchmark index rose 0.1% over the five days to 5,864.5 points.

Another busy one is expected next week. Here are five things to watch on the ASX 200:

ASX 200 futures pointing lower.

According to the latest SPI futures, the ASX 200 is poised to start the week deep in the red. Current futures contracts are pointing to a 36 point decline at the open on Monday. This follows a disappointing end to the week on Wall Street on Friday. Further weakness in the tech sector led to the Dow Jones falling 0.9%, the S&P 500 dropping 1.1%, and the Nasdaq index tumbling 1.1%. This meant Wall Street recorded its third weekly decline.

Brickworks FY 2020 result.

The Brickworks Limited (ASX: BKW) share price will be one to watch on Thursday when it hands in its full year report card. The building products and property development company wasn’t a particularly positive performer during the first half of FY 2020. It posted a 1% increase in total revenue to $449 million and a 37% decline in underlying net profit after tax to $100 million. However, trading conditions in the United States have improved over the last few months, which could have boosted its second half performance.

Tech shares on watch.

It looks likely to be another volatile week for the Australian tech sector after a disappointing decline on the Nasdaq index on Friday. Investors appear undecided on whether or not the tech rout is finally over. This could mean another five days of ups and downs for the likes of Afterpay Ltd (ASX: APT) and Appen Ltd (ASX: APX).

Premier Investments full year results.

Premier Investments Limited (ASX: PMV) is expected to release its full year results on Friday. According to a note out of Goldman Sachs, its analysts expect the company to report net profit after tax of $152.2 million on a pre-AAB16 basis or $138.8 million adjusted for AASB-16. The latter is up 11.1% year on year. Its analysts are also forecasting a fully franked 20 cents per share final dividend, down from 37 cents per share a year earlier.

Soul Pattinson result.

More reading

• How to generate $1,000 a month in dividends
• These were the best performing ASX 200 shares last week
• Is it time to save more or invest more in ASX shares?
• These were the worst performing ASX 200 shares last week
• ASX 200 drops 0.3%, gold miners keep rising

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of and has recommended Brickworks, Premier Investments Limited, and Washington H. Soul Pattinson and Company Limited. The Motley Fool Australia owns shares of AFTERPAY T FPO and Appen Ltd. 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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I think there are always ASX share opportunities to buy for our portfolios, you just have to buy them when they’re good value. I know where I’d invest if I had $20,000 to allocate.

The share market has proven to be a good wealth builder for decades. I think that’s going to continue for many years to come.

With $20,000, I’d buy these ASX shares for the long-term:

Pushpay Holdings Ltd (ASX: PPH) – $6,000

Pushpay is my highest-conviction individual share idea at the moment. The ASX share facilitates digital donations to organisations like large and medium US churches.

The company was growing pleasingly before COVID-19 hit, but the pandemic has caused Pushpay’s adoption to be brought forward as more people stay home, avoid groups and change to giving electronically rather than giving cash. A big benefit of Pushpay’s offering is that it also has a livestreaming option so that churches and congregations can stay connected.

In FY20 the ASX grew its revenue by around a third. In FY21 it’s expecting to at least double its earnings before interest, tax, depreciation, amortisation and foreign currency (EBITDAF). Those are good growth numbers. 

The company is aiming for US$1 billion of revenue from the US church sector over the long-term. There are plenty of other ‘donation markets’ that Pushpay can expand into over the coming years.

One of the main things that attracts me to Pushpay is how scalable it appears to be. In FY20 alone it increased its gross profit margin by five percentage points from 60% to 65%.

At the current Pushpay share price it’s trading at 34x FY21’s estimated earnings.

WAM Microcap Limited (ASX: WMI) – $4,000

WAM Microcap is my preferred listed investment company (LIC). I think investors can generate strong outperformance by focusing on small caps, if you know what you’re doing. The LIC targets ASX shares with market capitalisations under $300 million. The WAM team are very good at this. 

Past performance is not a guarantee of future performance at all. However, it must be said that WAM Microcap has done a good job of producing strong performance over the long-term with average gross portfolio returns of 21.7% per annum since inception in June 2017 (before fees, expenses and taxes). Over the past year it has done well too, with a gross return of 25.4%. I don’t think you can expect future returns to be as good as that, but it could keep doing well.

WAM Microcap offers an ordinary grossed-up dividend yield of 5.6%. It also seems to be trading close to its pre-tax net tangible assets (NTA) per share at 31 August 2020. So it’s a fair price to buy shares. 

Bubs Australia Ltd (ASX: BUB) – $3,000

Bubs is my preferred high-risk, high-reward idea at the moment. I think the goat milk infant formula producer has very good potential if it can capture market share in Asian markets like China and Vietnam.

So far it’s working really well. In FY20 Bubs grew total revenue by 32% to $62 million. Chinese direct sales went up 32% to $13 million. That’s good growth from the ASX share.

What particularly excites me is that export revenue outside of China increased five-fold and represented 10% of total revenue in FY20. It’s this area of the business that particularly excites me because of the size of the total addressable market.

Bubs has a variety of products that can all continue to grow strongly over the coming years and lead to rising profit margins for the ASX share.

The Bubs share price has fallen 13% over the past month. I think it represents very attractive value for how much potential growth there is outside of China. Of course, there are China risks but I think the company is doing the right things to grow market share there with its localised production strategy.

Future Generation Global Invstmnt Co Ltd (ASX: FGG) – $7,000

Future Generation Global is another good LIC in my opinion. It invests in the funds of Australian fund managers who invest in overseas shares. It has money with top managers like Magellan Financial Group Ltd (ASX: MFG), Cooper Investors, Caledonia and Marsico.

However, these fund managers work for free so that Future Generation Global can donate 1% of its net assets each year to youth mental health charities. It’s a great initiative, particularly during these times. 

The great thing about Future Generation Global is that it offers very good diversification because it’s invested in a number of portfolios, not just individual businesses.

Its gross portfolio performance has been better than the MSCI AC World Index (AUD) over both the short-term and the long-term.

Outperformance and diversification are the main reasons I’m willing to invest so much of my theoretical $20,000 into it.

At the current Future Generation Global share price it’s priced at a 17% discount to the NTA at 31 August 2020. That’s a very nice discount in my opinion. 

Foolish takeaway

I think all four of these ASX shares could be good buys to beat the market over the long-term. Pushpay is the one I’d be most likely to buy, however I’d happily buy shares of them all for my portfolio.

More reading

• How to generate $1,000 a month in dividends
• Where to invest $10,000 into ASX shares immediately
• Why I’m more excited about WAM Microcap shares
• 3 ASX growth shares I’d buy right now
• Why you should invest $5,000 into these ASX shares right now

Tristan Harrison owns shares of Future Generational Global Investment Company Limited and WAM MICRO FPO. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of BUBS AUST FPO and PUSHPAY FPO NZX. The Motley Fool Australia has recommended BUBS AUST FPO and PUSHPAY FPO NZX. 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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I believe there are some ASX shares that offer an attractive combination of growth and income.

Businesses that are steadily growing profit are likely to see the share price rise over time. If they decide to pay dividends (or distributions) then they can also provide a growing source of income to shareholders.

Here are three ASX shares that could offer an attractive combination of income and growth:

Magellan Global Trust (ASX: MGG)

This is a listed investment trust (LIT) which invests in global businesses. Indeed, the LIT tries to invest in the best businesses across the world.

It’s run by Magellan Financial Group Ltd (ASX: MFG), with billionaire Hamish Douglass at the helm. The unlisted Magellan Global Fund, which is similar to the LIT, has been around for over a decade. Looking at the past 10 years, net returns from the unlisted fund have been 16.1% per annum. That’s a solid record.

I think Magellan Global Trust’s existing group of investments can do very well over the next few years. Some of its current largest exposures are: Alibaba, Alphabet, Atmos Energy, Eversource Energy, Microsoft, Tencent, Facebook, Visa, Mastercard and Reckitt Benckiser.

The ASX share targets a 4% distribution yield for investors. Based on the current Magellan Global Trust share price and net asset value (NAV), it’s trading at a 3% discount.

Clover Corporation Limited (ASX: CLV)

What is Clover? The company says that it has superior microencapsulation technology to enable nutritional oils, such as tuna, fish, algal and fungal oils, to be added to infant formula, foods and beverages. It claims its products reach the highest standards of purity, stability and performance, allowing customers to maximise and deliver nutrition whilst masking unpleasant taste and odour.

The Clover share price dropped 8% in reaction to the FY20 result despite it showing solid growth numbers. Sales revenue increased by 15.1% and net profit after tax (NPAT) rose by 23.6% to $12.5 million.

The company continues to see growth across the world and it’s excited by the potential for new products and partnerships, particularly in Europe after infant formula manufacturers adjust their formulations to meet the new EU standards.

There were delays at the Melody Dairies nutritional spray dryer because customer audits have been impacted by COVID-19 preventing travel, which will slow production volume initially.

If net profit can keep rising at an attractive double rate then its share price could keep rising over the coming years as well.

The ASX share also increased its final dividend by 5% to 2.5 cents. At the current Clover share price it offers a grossed-up dividend yield of 1.6%. The dividend could keep rising by double digits each year if net profit keeps growing strongly.

BWX Ltd (ASX: BWX)

BWX is a natural beauty business that manufactures and sells through a variety of brands including Sukin, Andalou Naturals and Mineral Fusion.

Before COVID-19, the natural beauty industry was growing even faster than ‘regular’ beauty.

BWX is certainly growing its market share at an impressive rate. In FY20 it grew net revenue by 26% to $187.7 million, earnings before interest, tax, depreciation and amortisation (EBITDA) grew by 30% to $27.5 million and statutory net profit rose 59% to $15.2 million. Pleasingly, the gross profit margin improved to 58%.

I’m excited by BWX’s growth potential. It is expanding its distribution network across the world with Sukin being rolled out in the northern hemisphere. Andalou Naturals is being brought to customers in Australia.

In FY20 the ASX share grew its dividend by 44% to 3.9 cents per share. That’s a big increase, yet the dividend growth was slower than the reported statutory growth, which is a healthy way to do it.

At the current BWX share price it offers a grossed-up dividend yield of 1.1%. It’s trading at 24x FY23’s estimated earnings.

Foolish takeaway

The valuations of both BWX and Clover seem reasonable for how much growth they could make over the next few years. Whilst you own them, you will receive a decent, (probably) fast-growing dividend. Magellan Global Trust offers diversification and exposure to some of the best businesses in the world, though I think it will be better value later this year.  

More reading

• How to generate $1,000 a month in dividends
• ASX 200 drops 0.3%, gold miners keep rising
• Clover (ASX:CLV) share price falls 10% on FY20 results
• Why 5G Networks, AMP, Clover, & Reliance shares are dropping lower today
• Magellan (ASX:MFG) reveals best share buys for September

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I continue to believe that the best way to grow your wealth is to make long term investments in quality shares with strong business models and just as strong growth potential.

Three shares that I think could generate outsized returns and potentially allow investors to retire rich are listed below. Here’s why I like them:

Domino’s Pizza Enterprises Ltd (ASX: DMP)

I think this pizza chain operator could be a fantastic option for investors. This is largely due to its strong market position and long term growth plans. Domino’s is aiming to grow its global store network by 7% to 9% per annum for the next 3 to 5 years and same store sales growth by 3% to 6% per annum. Looking longer term, by 2033 the company is targeting a total of 5,500 stores. This compares to the 2,668 stores it had at the end of FY 2020. If it delivers on these targets, then I believe it will lead to strong earnings growth over the next decade and drive the Domino’s share price notably higher.

Jumbo Interactive (ASX: JIN)

Another long-term option for investors to consider is Jumbo Interactive. It is an online lottery ticket seller and best known as the operator of the Oz Lotteries website. But there’s more to the company than this. As well as benefiting from the shift to online gambling in the Australian market, it has bold international expansion plans with its Powered by Jumbo software as a service (SaaS) business. Management notes that the global lottery market is worth US$303 billion a year, but just 7% of this market is online at the moment. Due to the quality of its SaaS business, I believe it has the potential to win a meaningful slice of this market over the next decade.

Pro Medicus Limited (ASX: PME)

A final option to consider is Pro Medicus. It is a provider of a full range of radiology IT software and services to hospitals, imaging centres, and healthcare groups globally. It has been growing at a very strong rate over the last few years thanks to the continued adoption of its software by major healthcare institutions. This even continued in FY 2020 despite the pandemic, leading to Pro Medicus delivering a 23.9% increase in revenue from underlying operations to $56.8 million and a 33.4% lift in underlying profit before tax to $30.24 million. Since then it has announced a major contract win with NYU Langone Health. Given the quality of its offering and its burgeoning sales pipeline, I don’t expect this to be the last.

More reading

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• Turn $6k into $60k, a guide to growth investing
• ASX 200 drops 0.8%, Nearmap (ASX:NEA) sinks
• Pro Medicus (ASX:PME) share price higher on major contract win and research agreement
• Why IGO, IPH, Jumbo, & Whitehaven shares are pushing higher today

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 and recommends Jumbo Interactive Limited and Pro Medicus Ltd. The Motley Fool Australia has recommended Domino’s Pizza Enterprises Limited, Jumbo Interactive Limited, and Pro Medicus Ltd. 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.

The post Grow rich with these excellent ASX shares appeared first on Motley Fool Australia.

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If you’re looking to construct a $100,000 share portfolio, you’ll no doubt be on the lookout for investment ideas.

To help you on your way, I have picked out a couple of shares which I think could be excellent core holdings. This is due to their strong business models and positive long term outlooks.

Here’s why I think investing some of the funds into these two shares would be a very smart move:

Altium Limited (ASX: ALU)

The first ASX share to consider as a core holding in your portfolio is Altium. It is an electronic design software provider and the company behind the Altium Designer platform. Subscriptions for this platform have been growing at a rapid rate over the last few years and recently surpassed the 50,000 mark. This strong growth has been driven by the Internet of Things (IoT) and artificial intelligence (AI) markets, which are underpinning an explosion of electronic devices globally.

But Altium isn’t a one-trick pony. It also has a number of other businesses supporting its growth. These include workflow solution platform NEXUS and electronic parts search engine Octopart. Given the favourable industry tailwinds and its leadership position in the electronic design market, I believe Altium is well-placed to achieve its revenue target of US$500 million in FY 2025/26. This compares to its FY 2020 revenue of US$189 million.

CSL Limited (ASX: CSL)

Another ASX share that I think would be a perfect addition to this portfolio is CSL. I believe the biotherapeutics company is one of the best blue chip shares that Australia has to offer. This is due to the quality of its CSL Behring and Seqirus businesses.

Although plasma collections are difficult at present because of the pandemic and are likely to weigh on immunoglobulin margins in FY 2021, I’m optimistic that increasing demand for influenza vaccines because of COVID-19 will help offset this. Looking further ahead, thanks to its lucrative portfolio of therapies and vaccines and lucrative research and development pipeline, I believe CSL is well-placed to deliver solid sales and earnings growth over the 2020s.

More reading

• 2 exciting ASX healthcare shares to buy for the long term
• 3 ASX growth shares I’d buy right now
• Bolster your portfolio with these outstanding ASX blue chip shares
• Why you should invest $5,000 into these ASX shares right now
• 3 retirement myths you can’t afford to believe

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 and recommends Altium. 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. 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.

The post Where I would invest $100,000 into ASX shares appeared first on Motley Fool Australia.

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