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Top stock picks for June

Credit: Simon Cunningham

We asked our writers to pick their favourite stocks to buy in June and the below is what they came up with.

Tom Richardson: CSL Limited (ASX: CSL)

I’ll admit it would have been better to recommend this stock this time last year, but I think investors still have plenty of opportunity to get on board what is probably Australia’s best blue-chip business. The medical products business has a moat evidenced by its strong track record of profit and dividend growth. CSL also reinvests large amounts of operational cash flow into research and development in order to commercialise the medical products of tomorrow. I don’t see that changing over the years ahead and wouldn’t be put off starting a position today despite the lofty valuation.

Motley Fool contributor Tom Richardson owns shares in CSL limited.

David Gow: Washington H. Soul Pattinson and Co. Ltd (ASX: SOL)

Despite being up 20% since its low in October 2017, I think Soul Patts still represents a great holding for anyone’s portfolio. The diversified investment conglomerate has beaten the market handsomely over the long-term and is a family-run company with vast business experience and skill in the game.

Soul Patts recently announced its half-year results for 2018. Regular profit after-tax was up 19.4% and the value of its investment portfolio increased by 16.5% in the half. The interim dividend was increased once again – making that 20 years in a row of unbroken dividend increases.  Shares currently trade on a gross yield of 4.1%.

Motley Fool contributor David Gow owns shares in Washington H. Soul Pattinson and Co. Ltd

Tristan Harrison: Paragon Care Ltd (ASX: PGC)   

Paragon is a small-cap healthcare provider that supplies devices, equipment, beds and other items to healthcare clients like aged facilities and hospitals. Before all of the new acquisitions, a majority of its revenue came from public hospitals, which means it has a defensive set of earnings.  

Australian healthcare expenditure has roughly doubled over the past 10 years and this could accelerate over the coming years due to the ageing population. New acquisitions means the company can offer its clients more products and this translates to bigger economies of scale over time. It’s currently trading at 14x FY18’s estimated earnings.  

Motley Fool contribu tor Tristan Ha rrison owns shares of Paragon Care Ltd .  

Matthew Breen: Base Resources Limited (ASX: BSE) 

Base Resources is an Australian mineral sands miner operating out of Africa. It is the 100% owner of the Kwale mine in Kenya as well as an 85% owner in the Toliara mine in Madagascar. As a result of the recent Toliara acquisition, Base has pencilled in earnings for the next 40 years. With a relatively low P/E ratio of 5.27, I believe the price is being held back by doubt over the successful development of the Toliara mine. However, Base Resources management has delivered historically and I believe the potential rewards far outweigh the risks.  

Motley Fool contributor Matt Breen has no finanial interest in Base Resources.

James Mickleboro: Aristocrat Leisure Limited (ASX: ALL)

In May this gaming technology company released its half-year results and reported a 24% increase in net profit on the prior corresponding period. The highlight for me was the increase in daily active users of its digital games. They rose 493% to 8.9 million and are currently averaging revenue of 41 U.S. cents per user per day. I believe these recurring revenues are attractive and will support the robust growth of its pokie machines business which has continued to win market share. While its shares aren’t cheap, I’m confident its current growth profile can justify the premium.

Motley Fool contributor James Mickleboro has no financial interest in Aristocrat Leisure Limited.

Simon Proudman: National Storage REIT (ASX: NSR)

National Storage is a more unusual REIT. Moving away from the traditional office, retail or commercial property REITs, National Storage only focuses on self-storage, and mainly for residential customers.

In a fragmented market, the company is becoming a leader in the sector, buying and managing 127 sites across Australia and New Zealand. With an experienced management team following a successful approach to increasing yields across its growing asset base, NSR has seen profit growth of 11% over the last 12 months.

With a dividend yield of 6%, the share offers a nice income stream as well as the potential for capital growth.

Motley Fool contributor Simon Proudman owns shares in National Storage REIT.

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The Motley Fool Australia owns shares of and has recommended Washington H. Soul Pattinson and Company Limited. The Motley Fool Australia has recommended National Storage REIT and Paragon Care 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.

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