3 internet businesses all ASX investors must own 

Credit: Jason Howie

Australia has produced many quality companies. Fortunately for Australian investors some of the very best are listed on the ASX. As investors it is our job to grasp onto these companies when the opportunity arises. Carsales.Com Ltd (ASX:CAR) SEEK Limited (ASX:SEK) and REA Group Limited (ASX:REA) all fit this description. All three hold dominant market positions obtained by being first movers into their respective online space.

Dominance is not a word that should be used lightly when describing a company, but it truly fits Carsales. Carsales as the name suggests controls the bulk of the marketing of new and used car sales. Just last year in an attempt to break Carsales’ hold on the market, new car dealers began withdrawing cars from Carsales’ website only to return when faced with dwindling sales. Even competitors offering to sell cars for free have had little impact on its ever growing profits.

Among real estate agents, is affectionately known as the Mafia. If you want to sell your home you pay what asks. Just like Carsales, is the market leader for home sales. Its dominant position allows it to charge considerably more than its nearest competitor owned by Fairfax Media Limited (ASX:FXJ). With the backing of Newscorp, the REA Group has expanded overseas and looks set to replicate its success in the American residential real estate market.

If REA is known as the Mafia then perhaps SEEK should take on the role of the Godfather. SEEK’s command of the employment market is highlighted by its web traffic data. SEEK’s domestic website receives over 35-million hits a month and its international arm over 340-million hits in the same time period. Its latest results presentation claims it now covers over 4 billion people. With over half of SEEK’s revenue and EBITA coming from outside Australia, SEEK has proven its model is transferrable worldwide. The jewel in the crown of SEEK’s international arm is a majority stake in Zhaopin Ltd (ADR) (NYSE:ZPIN), the leading employment website in China. Zhaopin is uniquely poised to capitalise on the mass movement of the Chinese middle class from blue to white collar jobs.

New Potentially Life-Changing Share Picks Just Released

The Motley Fool's renowned dividend investing guru recently revealed his newest dividend buy recommendation and short list of 3 Best Dividend Buys Now. Which means if you're reading this message right now, you're not on the list to uncover their names before they potentially go gangbusters. Simply click here to learn more about these shares.

Motley Fool contributor Alan Edmunds owns shares in SEEK, Carsales and REA Group. 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 Bruce Jackson.

Two New Stock Picks Every Month!

Not to alarm you, but you’re about to miss a very important event! Chief Investment Advisor Scott Phillips and his team at Motley Fool Share Advisor are about to reveal their latest official stock recommendation. The premium “buy alert” will be unveiled to members and you can be among the first to act on the tip.

Don’t let this opportunity pass you by – this is your chance to get in early!

Simply enter your email now to find out how you can get instant access.

By clicking this button, you agree to our Terms of Service and Privacy Policy. We will use your email address only to keep you informed about updates to our website and about other products and services we think might interest you. You can unsubscribe from Take Stock at anytime. Please refer to our Financial Services Guide (FSG) for more information.