If you’re looking to purchase some quality securities on the Australian stock exchange, consider checking out these fantastic companies.
The Australian stock market has performed historically well when benchmarked against the world, and there are no shortages of investors who are looking to put their money into the market down under. If you’ve been thinking about buying some shares with local exposure, here are some top picks and the reason why I think they’re worth taking a look at. As always, remember that you always ought to do your own research and contact a professional before making any investment decisions. Your money is at risk when in the stock market, and prior performance is not an indication of future performance. Okay – now let’s get down to the nitty-gritty and talk about what shares are out there on the ASX that you might want to pick up!
Aristocrat Leisure (ASX:ALL)
Aristocrat Leisure is an Australian-based producer of gaming machines and other related products. In terms of revenue, they’re the second-largest manufacturer of gambling machines in the world, trailing only behind IGT. In the last 10 years of business, Aristocrat has made a number of valuable acquisitions that investors might see as indications of their ambitious growth targets within the sector. While Aristocrat Leisure sells gaming machines all over the world, Australians actually have the highest per-capita amount of money spent on gambling. Not only that, but Australians seem to spend an unprecedented amount of money on gambling machines – those created by Aristocrat Leisure. See this handy image for a look at just how large the domestic market is for ‘pokies’. Although Aristocrat Leisure has yet to venture into the online porn games industry, it may eventually decide to do that at some point.
Aristocrat Leisure is currently trading at $37.05 per share, it has a market cap of $23.66 billion and a P/E ratio of 33.82. It does pay a dividend, but this was only 1.51% last year.
Saracen Mineral (ASX:SAR)
Saracen Minerals is an Australia-based gold mining company with operations at two different locations – The Carosue Dam and The Thunderbox. Australia has always been a relatively large contributor to the mining industry, and Saracen focuses exclusively on gold. What people hope to see from Saracen Mineral is extreme growth over the coming 5 to 10 years, with regular acquisitions and leveraging to build their portfolio of operations. The day this article was written, Saracen Mineral posted record production numbers and a doubling of profit year-on-year. With some level of uncertainty regarding the US 2020 presidential election and the full impact of the Coronavirus on global supply chains and trade, investing in a company that produces gold can also offer a hedge against a downturn. This owes to the fact that investors tend to buy up gold whenever markets look like they’re taking a turn for the worst.
Saracen Mineral is currently trading at $4.21 per share, it has a market cap of $4.64 billion and a P/E ratio of 38.58. It has yet to pay a dividend since it became public in 1999.
CSL Limited: (ASX:CSL)
CSL Limited is a Melbourne-headquartered biotechnology firm that focuses on producing treatments and prevention tools for more serious medical conditions. Perhaps their greatest accomplishment was producing the world’s first Swine Flu vaccine, which was approved in September of 2009 – 21 million doses were ordered by the Australian government for every Australian over the age of 10. It’s currently the second-largest company on the ASX by market cap but still presents itself as being a fantastic investment opportunity – especially after the Coronavirus outbreak, which has the potential to become a global pandemic if not treated appropriately. For a closer look at the valuation and overall potential of CSL going forward, check out this article by Glenn Freeman that came out around 6 months ago. Although CSL has grown substantially since then in terms of market cap, what’s mentioned is still true.
CSL Limited is currently trading at $332.55 per share, it has a market cap of $150.94 billion and a P/E ratio of 50.52. Its dividend yield last financial year was 0.69%
Accent Group Limited: (ASX: AX1)
Accent Group Limited manages a number of household brands in the shoe sector, including the likes of Vans, Timberland, Skechers, Dr. Marten’s and Cat. They also operate over 130 retail outlets under the ‘The Athlete’s Foot’ brand in Australia and New Zealand. With the launch of MyFit 3D, The Athlete’s Foot is looking to gain a market share in the provision of perfectly fitted sports and general day-to-day wear shoes. Morgan Stanley currently has a buy rating for Accent Group and has set a price target of $2.30. The reason for the ambitious target is allegedly due to the unprecedented growth rates in active footwear for running and other sports activities. Everyone wants to get fit so they can enjoy some nice sex dating – it doesn’t take a genius to figure that out.
Accent Group Limited is currently trading at $1.90 per share, it has a market cap of $1.03 billion and a P/E ratio of 19.92. Its dividend yield last financial year was a relatively impressive 4.34%.
Qantas Airways Limited: (ASX: QAN)
Qantas Airways Limited is an airline that operates both domestic and international flights all over the world. Qantas is regularly ranked as one of the best airlines in the world by consumers. Domestic tourism is big business in Australia with interstate travel making up a large amount of the industry – this puts Qantas in a fantastic position to enjoy long-term growth and demand from customers who have high levels of brand loyalty when it comes to flying. Additionally, with downward pressure being applied to the oil industry as demand slips, we could see Qantas soar to new heights on the ASX in 2020.
Qantas Airways Limited is currently trading at $6.35 per share, it has a market cap of $9.47 billion and a P/E ratio of 11.65. Its dividend yield last financial year was a relatively impressive 3.94%.
Conclusion
Those are my five best picks for stocks on the ASX that ought to cover a wide array of industries, provide some hedging against major issues and good growth even when things go well in the global economy. While it’s almost always a good idea to buy an ASX 200 ETF, if you’re really looking to see high levels of growth in your portfolio, the above five options ought to give you something to think about.
