While rates are rising at a quick pace in the United States, recent Australian economic data appears to rule out any increases over here any time soon.
Because of this, I continue to believe that investors would be better off skipping savings accounts and term deposits in favour of the share market.
If I had $10,000 to invest I would consider putting it in one of these three ASX shares:
CSL Limited (ASX: CSL)
Although its shares have been on a tear over the last 12 months, I don't believe it is too late to invest in this global biotech company. Thanks largely to a positive shift in its product and geographic sales mix and better than expected sales of Idelvion and Haegarda, the company expects to achieve net profit after tax in the range of US$1,680 and US$1,710 million in FY 2018. At the top end this will mean growth of almost 28% year-on-year. I believe this level of growth, its high-quality operations, fast-growing Seqirus influenza business, and burgeoning pipeline of new products justifies the premium its shares trade at today. Though, it is worth remembering that a failure to live up to the market's lofty expectations could weigh heavily on its share price.
Macquarie Telecom Group Ltd (ASX: MAQ)
One of my favourite mid cap growth shares would have to be Macquarie Telecom. Unlike telco giant Telstra Corporation Ltd (ASX: TLS), Macquarie Telecom has been delivering strong earnings and dividend growth over the last 12 months. This is thanks largely to its fast-growing Cloud Services business. In the first-half of FY 2018 the segment delivered a 30% increase in half-year net profit, making it the company's largest segment now. And with the seismic shift to the cloud accelerating, I remain confident that it can continue growing at a strong rate for the foreseeable future.
Xero Limited (ASX: XRO)
By the end of FY 2018 in March this accounting software provider had added 351,000 new subscribers over the 12 months to take its total subscriber count to just under 1.4 million. This led to annualised monthly recurring revenue (AMRR) growing 33% on the prior corresponding period to NZ$484.4 million. The bulk of these subscribers come from the ANZ markets where Xero enjoys market leadership and has amassed 884,000 subscribers. After which, the next biggest contributor is the UK market which has 312,000 subscribers. At present, the North American market accounts for just 132,000 subscribers after growing 43% year-on-year. It is this market in particular which I think makes Xero a great buy and hold option. Although it will take time, I believe there is potential for significant growth in the U.S. over the coming years, which I expect will lead to above-average long-term earnings and revenue growth.
