There aren’t many businesses on the ASX that I am confident every investor should own.
Some shares aren’t good choices for any portfolio. Some shares are only good for retirees. Some shares are only good for younger investors with a longer timeframe.
I think the following three shares are good for every investor:
Ramsay Health Care Limited (ASX: RHC)
Ramsay is the largest private hospital operator in Australia and one of the largest in the world.
It has been one of the best shares to own on the ASX over the last two decades and I think it could be one of the best to own over the next two decades too.
The ageing population of all the countries that Ramsay operates in should be a strong tailwind whilst Ramsay grows its number of hospitals.
Ramsay has increased its dividend every year since 2000, I think this will continue and it’s why I think this stock is appropriate for retirees.
It’s currently trading at 28x FY17’s estimated earnings with a grossed-up dividend yield of 2.46%.
REA Group Limited (ASX: REA)
REA Group is the owner of realestate.com.au and has investments in other property sites around the world including the USA and Asia.
The importance of digital advertising cannot be exaggerated in 2017. REA Group is able to implement strong price increases without losing any volume of customers. The more properties that are built the more revenue that REA Group can generate in Australia and overseas.
The strength of the profit and dividend increases that REA Group is achieving make it a great option for young investors and retirees.
REA Group is currently trading at 37x FY17’s estimated earnings with a grossed-up dividend yield of 1.86%.
Altium Limited (ASX: ALU)
Altium is one of the world’s biggest providers of software for designers using electronic PCBs.
The ‘Internet of Things’ and the increasing complexity of products is giving Altium a huge boost. The business is expecting to double revenue over the next few years, this could be fantastic for shareholders as profit and dividends soar.
Altium is currently trading at 33x FY17’s estimated earnings with an unfranked dividend yield of 2.31%.
All three stocks are worthy of being in any portfolio. However, they are all trading at quite a high valuation, if I were only buying for the short-term Ramsay would be the only one I would consider at the current prices.
I would gladly buy all three for the long-term, but that would require holding for five or more years.