MENU

3 mid cap stars I would buy in August

I think in the mid cap side of the Australian share market there are many high-quality shares with strong long-term growth prospects that could make them great options today.

Three in particular that stand out at present are listed below. Here’s why I think they could be stars of the future:

Dicker Data Ltd (ASX: DDR)

This morning this founder-led computer software and hardware wholesale distributor announced yet another distribution deal, this time for the complete range of LG Commercial Display products. While it may not have a material impact on its revenue, I expect it to support the solid growth that the company has been exhibiting this year. This should put it in a position to continue increasing its dividend over the coming years, potentially making it one of the best dividend options in the mid cap space. This year management intends to increase its full-year dividend to a fully franked 18 cents per share, which means that its shares offer a yield of approximately 6% currently.

Kogan.com Ltd (ASX: KGN)

Kogan is an e-commerce company that I think has a bright future ahead of it. It impressive sales growth and expansion into other verticals has really impressed this year and I expect it to build on this in FY 2019. While its growth came in a little slower than expected recently, it was still explosive. So with its shares down by around 50% from their 52-week high, I think that now could be an opportune time to consider snapping them up.

Macquarie Telecom Group Ltd (ASX: MAQ)

If you’d sold your Telstra Corporation Ltd (ASX: TLS) shares a year ago and bought Macquarie Telecom shares you’d not only have saved yourself from a 31% decline, you’d be up 40% as well. The good news is that I don’t think it is too late to do the switch and would suggest investors consider it in August. After all, Macquarie Telecom is a company that stands to benefit greatly from the cloud computing boom thanks to its Hosting (Cloud Services) segment. In the first-half of FY 2018 the segment grew its EBITDA by 38% to $13.4 million, meaning it now accounts for 59.5% of total EBITDA. With the shift to the cloud continuing to accelerate, I expect it to deliver similarly strong full-year growth.

Finally, here are three more mid cap shares I would buy in August as well.

The Disruptors: 3 Revolutionary Aussie Companies to Back for 2018

We're living in one of the most exciting times in investing history. Innovation and a booming culture of entrepreneurship are constantly creating new companies with the potential to make forward-thinking investors very rich. Now more than ever, one small, smart investment could make a huge difference to your wealth.

That's why at The Motley Fool we've been scrutinizing the ASX to uncover the kinds of companies that we believe could turn into the next Atlassian.

We've found three exciting companies that we believe re poised to perform in the new year. Click here to uncover these ideas!

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of and has recommended Dicker Data Limited and Telstra Limited. The Motley Fool Australia has recommended Kogan.com ltd. 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.

Two New Stock Picks Every Month!

Not to alarm you, but you’re about to miss a very important event! Chief Investment Advisor Scott Phillips and his team at Motley Fool Share Advisor are about to reveal their latest official stock recommendation. The premium “buy alert” will be unveiled to members and you can be among the first to act on the tip.

Don’t let this opportunity pass you by – this is your chance to get in early!

Simply enter your email now to find out how you can get instant access.

By clicking this button, you agree to our Terms of Service and Privacy Policy. We will use your email address only to keep you informed about updates to our website and about other products and services we think might interest you. You can unsubscribe from Take Stock at anytime. Please refer to our Financial Services Guide (FSG) for more information.