I like the idea of investing in shares that are growing from some sort of tailwind. Even if you don’t buy the share at the best price the tailwind should hopefully push the stock higher over time. The ageing population is one of the most obvious tailwinds, but there are others. Tourism is another tailwind that seems to be growing each year. Funnily enough, the ageing population is also boosting this – the more people that enter retirement the more people there are who may travel. The rising Asian middle class has worked hard and now wants to see the…
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I like the idea of investing in shares that are growing from some sort of tailwind. Even if you don’t buy the share at the best price the tailwind should hopefully push the stock higher over time. The ageing population is one of the most obvious tailwinds, but there are others.
Tourism is another tailwind that seems to be growing each year. Funnily enough, the ageing population is also boosting this – the more people that enter retirement the more people there are who may travel. The rising Asian middle class has worked hard and now wants to see the world. The world is becoming increasingly accessible, Qantas Airways Limited (ASX: QAN) has just started a non-stop flight from Perth to London. All of this points to growth in tourism.
With those factors in mind, here are three shares that should benefit in the coming years:
Sydney Airport Holdings Ltd (ASX: SYD)
This company operates Sydney Airport, the gateway to Australia’s biggest tourist attraction. Every month Sydney Airport reports its passenger numbers. For March 2018 it reported total passenger growth of 6.1% compared to last year and 11.1% growth of international passengers, although some of this related to the earlier Easter holiday period.
The number of Indian passengers increased by 28.2%, Chinese passengers increased by 19.9%, South Korean passengers increased by 15.2% and USA passengers increased by 14.3%.
If this growth continues for the next few years then Sydney Airport could continue to report good profit growth figures.
Auckland International Airport Ltd (ASX: AIA)
New Zealand is going through a similar tourist boom. Auckland Airport is an integral entry point into the scenic country, the company also releases monthly updates to the market.
It hasn’t released its March update yet, but for February total passengers increased by 7.1% and total international passengers increased by 6.3%.
Crown Resorts Ltd (ASX: CWN)
Crown is the largest entertainment and accommodation business in Australia with its casinos in Melbourne and Perth. The company seems to be over its Chinese VIP gamer problems as it returned to growth in its latest report.
The company’s future, or at least the next decade, seems very promising with Crown Sydney being constructed. After it’s finished it could add a significant chunk of earnings to Crown, so it could be a decent long-term investment at today’s price.
I like all three businesses, although I’m not yet a shareholder in any of them. The interest rate rise could harm the share price of the airport businesses and I don’t think Crown is going to shoot the lights out, which is why they have remained on my watchlist for now. However, all three would be buys if their prices declined over 20%.
Until then, I reckon these top growth shares would be better investments at today's prices.
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Motley Fool contributor Tristan Harrison has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of and has recommended Crown Resorts Limited and Sydney Airport Holdings 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.