If you're new to investing, it's hard to know where to start. There are over 2,000 companies listed on the ASX – but most of them aren't investment grade. Here are 3 companies I'd consider as a starting point:
CSL Limited (ASX: CSL)
CSL is a company that collects blood from donors and turns it into a variety of blood products including plasma and blood-derived treatments for diseases like angioedema and haemophilia. The company also develops and manufactures a wide variety of vaccines for influenza, hepatitis B, and so on. CSL is well managed, focused on shareholder interests, and has an extensive research & development (R&D) pipeline.
The major downside is that shares look expensive – although they are never cheap. CSL is one of the best companies on the ASX and, if I knew I was going to be invested for 10 years or longer, I'd consider buying shares today.
Fisher & Paykel Healthcare Corp Ltd (ASX: FPH)
Fisher & Paykel is an oxygen device developer and manufacturer, focused on the US market. Demand for these types of products is growing at around 6% per annum, driven by increasing obesity and an ageing population, among other factors. Fisher & Paykel has been cashing in, and is in the process of building a huge new factory in Mexico to meet expected demand. Growing demand, plus the switch of manufacturing from New Zealand to Mexico, is expected to result in higher revenues and lower costs.
Most of this unfortunately is already priced in, and the market is overlooking the risks of a patent lawsuit against ResMed Inc. (CHESS) (ASX: RMD). As with CSL, on a 10-year timeframe, Fisher & Paykel looks like an interesting opportunity.
