The Australian share market is home to a good number of high quality blue chip shares for investors to choose from. 

Three blue chips which I think would be great options for a balanced portfolio are named below:

Here’s why I like them:

CSL Limited (ASX: CSL)

My favourite blue chip share on the Australian market remains this global biotherapeutics giant. CSL is made up of two world class businesses – CSL Behring and Seqirus. CSL Behring is the global leader in plasma therapies, whereas Seqirus is the second biggest in the influenza vaccines industry. I believe both businesses have strong long-term growth potential thanks to their leading therapies and lucrative research and development pipelines. So, with the CSL share price down materially from its 52-week high, now could be an opportune time to make a long term investment.

REA Group Limited (ASX: REA)

REA Group is another of my favourite blue chip shares. I was very impressed with its performance during the housing market downturn and the way it still achieved strong profit growth despite the tough trading conditions. While the housing market is now under pressure because of the pandemic, I’m optimistic that it will recover swiftly once the crisis passes. This could mean a rebound in property listings in 2021. Which combined with price increases, new revenue streams, and cost cutting, could see REA Group’s growth accelerate over the coming years.

Telstra Corporation Ltd (ASX: TLS)

I’ve been very impressed with the way Telstra has turned around its fortunes over the last 18 months and feel it is well placed to return to growth in the near future. This is due to the return of rational competition in the telco industry, its cost-cutting plans, and its leadership position in 5G. Another positive is that I believe the dividend cuts are over and its current payout is sustainable. In light of this, now could be a good time to consider a patient long-term investment in the company’s shares.

More reading

• Deepening partnership with Telstra fails to excite the Dubber share price
• Where I would reinvest my Rio Tinto dividends
• Invest like Warren Buffett and buy these ASX shares
• House prices are falling – which ASX shares are in the firing line?
• ASX 200 drops 0.6%, Telstra sells data centre for $416.7 million

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 CSL Ltd. The Motley Fool Australia owns shares of and has recommended Telstra Limited. The Motley Fool Australia has recommended REA Group 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.

The post The best blue chip ASX shares to buy today appeared first on Motley Fool Australia.

from Motley Fool Australia https://ift.tt/3kjiSIM

There are always good ASX shares to invest in, you just need to find them and buy them at the right price.

Plenty of the ASX’s best growth shares have risen strongly over the last few months like Xero Limited (ASX: XRO) and Goodman Group (ASX: GMG). I don’t think I could buy them at these high levels.

But there are other ASX shares with plenty of growth potential that I’d love to buy for my portfolio:

Magellan High Conviction Trust (ASX: MHH) – $6,000

This is a listed investment trust (LIT), I think it’s one of the best investment businesses around. It’s run by Magellan Financial Group Ltd (ASX: MFG) with Hamish Douglass at the helm.

The Magellan strategy is to invest in high-quality global businesses, not ASX shares, for the long-term.

At the end of June 2020 its equity positions were: a 13.8% allocation to Microsoft, a 13.7% allocation to Alibaba, a 9.5% allocation to Tencent, an 8.6% allocation to Alphabet, a 7.8% allocation to Facebook, a 7.4% holding of Starbucks, a 5.9% holding of SAP, a 5.7% holding of Visa and a 5.1% holding of Estee Lauder.

As you can see by the weightings, it’s a high-conviction portfolio which aims to outperform the market over the long-term.

The ASX share has a growth-focused portfolio, but it currently also has a large cash position. At 30 June 2020, 22.5% of the portfolio was cash. So it’s defensively positioned in-case the market takes another tumble due to COVID-19 or the upcoming US election.

One of the benefits of listing in LITs is that sometimes you can buy them for a lot less than their net asset value (NAV). At the time of writing, the LIT has an indicative NAV of $1.56 per share compared to the Magellan High Conviction Trust share price of $1.44 – a discount of around 7.5%.

Bubs Australia Ltd (ASX: BUB) – $2,500

I think one of the best ways to outperform over the long-term is to choose growth shares at the early stages of their expansion before most other investors realise the growth potential.

Bubs is one of those ASX shares that I think is on track for a very good future. It’s an infant formula company with a focus on goat milk products.

FY20 was a solid year of growth with revenue increasing by 32% to $62 million. The fourth quarter of FY20 showed very promising growth internationally with Chinese direct sales growth of 26% and other export market revenue up 71% despite pantry stocking in the third quarter of FY20 due to COVID-19.

Bubs earns a much higher margin on the infant formula that it sells, compared to other products, so as infant formula becomes a larger part of total sales the overall company will be more profitable. Bubs will also benefit from economies of scale.

The ASX share is regularly launching new products which will diversify its future earnings. New products include Vita Bubs (a vitamin and mineral supplement range), as well as ‘Bubs Goat Milk Junior Nutrition’ which is for children between the ages of 4 to 12.

I think the Bubs share price looks cheap for a long-term buy at under $0.90.

Pushpay Holdings Ltd (ASX: PPH) – $2,500

The Pushpay share price has drifted 18% lower over the past month as the excitement over Pushpay’s FY20 growth and FY21 expectations settled down. Lower prices are obviously better for buyers.

But I think the ASX share looks more like a buy now than it did before releasing its FY20 result.

The shift to digital giving looks like it’s here to stay, particularly with COVID-19 continuing to impact large parts of the US. Pushpay allows its large and medium US church clients to livestream to congregations. That’s a very useful feature in this current environment. Digital giving is also safer, infection-wise, than giving cash.

Pushpay now thinks that its earnings before interest, tax, depreciation, amortisation and foreign currency (EBITDAF) can at least double in FY21. That’s very strong guidance in my opinion. We should want our portfolio to be full of growing businesses like Pushpay.

At the current Pushpay share price it’s trading at 28x FY23’s estimated earnings.

Foolish takeaway

I like the idea of being able to buy some of the best global shares at a good discount, which is why I allocated the most to Magellan High Conviction Trust. However, I think that Pushpay and Bubs are two of the brightest ASX share prospects, which is why I also allocated $2,500 to each to them.

More reading

• Where to invest $20,000 into ASX shares right now
• Top ASX Stock Picks for August 2020
• Will the coronavirus kill cash?
• 3 top ASX shares to buy for growth investors in August
• Why these ASX mid cap shares could smash the market over the next 5 years

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 PUSHPAY FPO NZX and Xero. The Motley Fool Australia owns shares of and has recommended BUBS AUST FPO. The Motley Fool Australia has recommended 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.

The post Where I’d invest $11,000 into ASX shares right now appeared first on Motley Fool Australia.

from Motley Fool Australia https://ift.tt/33wCfbh

The Orocobre Limited (ASX: ORE) share price rocketed 33.3% higher in July. The huge share price surge earned the Australian mineral resources company a top spot among the biggest monthly gainers on the All Ordinaries Index (ASX: XAO) in July. The All Ords, in comparison, gained 0.9% for the month.

Orocobre’s shares joined most other Australian stocks in the late February and early March COVID-19 market rout. The Orocobre share price tumbled 41% from 21 February through 23 March. The share price didn’t turn around until hitting a 52-week low of $1.84 per share on 14 May.

By the end of July, the miner’s share price had rebounded strongly, up 61% from the 14 May low. Orocobre shares closed the month at $2.97 per share. 

Since then, the Orocobre share price has gained another 10.5%, giving the company a market cap of $898 million.

What does Orocobre do?

Orocobre is an Australian based global lithium carbonate supplier as well as a producer of boron.

In partnership with Toyota Tsusho Corporation and JEMSE, Orocobre constructed and currently operates the world’s first commercial, brine-based lithium operation. The company announced the Stage 2 Expansion of its flagship Olaroz Lithium Facility in Argentina in 2018. This will significantly expand its lithium carbonate production capacity. It supplies the fast growing industrial, technical and battery markets.

Orocobre and TTC have also commenced building a lithium hydroxide plant in Naraha, Japan suitable for different battery technologies. Orocobre also owns Borax Argentina S.A, a boron chemical and mineral producer.

Why did the Orocobre share price soar in July?

In the June quarter, Orocobre reported selling approximately 1,600 tonnes of lithium carbonate at approximately US$4,105 a tonne.

Like many miners, pandemic-related shutdowns restricted the company’s ability to complete all of its sales during the quarter. Most of these issues have been addressed, but delivery levels are still below normal, with customers delaying shipment due to excess inventories.

There was no clear signal from the company that would have sent the Orocobre share price 33% higher in July. Lithium remains oversupplied and prices remain at near record lows. It would seem forward-looking investors may be buying shares of Orocobre with an eye on the rapid growth forecast for the electric vehicle and home battery markets, both of which should lead to an increased demand for lithium.

At the time of writing, the Orocobre share price is sitting at $3.28 per share, closing the day up by 4.56%.

More reading

• These were the best performing ASX 200 shares in July
• These are the 10 most shorted shares on the ASX
• Top brokers name 3 ASX shares to sell next week
• These were the best performing shares on the ASX 200 in July
• Orocobre share price remained flat yesterday despite difficult quarter

Motley Fool contributor Bernd Struben 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.

The post Orocobre share price shrugs off low lithium prices to soar 33% higher in July appeared first on Motley Fool Australia.

from Motley Fool Australia https://ift.tt/2XzjOin