MENU

Are these the best mid cap shares on the ASX?

I think the Australian share market is home to some high quality mid cap shares with strong long-term growth potential.

Three that I think are among the best on offer right now are listed below. Here’s why I like them:

Helloworld Travel Ltd (ASX: HLO)

The shares of this integrated travel company have recently dropped back a touch after its CEO and Qantas Airways Limited (ASX: QAN) sold down their respective stakes. However, I feel it is important to understand the reason for this sell down. Which was to increase liquidity to improve the chances of its shares being included in the ASX 300 at the next rebalance. I expect the inclusion into the index would bring the company’s shares onto the radar of fund managers and potentially lead to a positive rerating to an earnings multiple more in line with its rivals.

Kathmandu Holdings Ltd (ASX: KMD)

One of my favourite options in the retail sector right now would have to be this outdoor and adventure retailer. Last month the company released its full year results and revealed an 11.7% lift in sales to NZ$497.4 million and a 32% increase in net profit after tax to NZ$50.5 million. I expect more of the same in FY 2019 and beyond thanks to its plans to accelerate the international growth of its Kathmandu and Obōz brands.

Kogan.com Ltd (ASX: KGN)

Despite the arrival of Amazon in Australia this ecommerce company continued its remarkable growth in FY 2018. It posted gross transaction value of $492.6 million, revenue of $412.3 million, and a net profit after tax of $14.1 million. This was a year-on-year increase of 47.3%, 42.4%, and 110.4%, respectively. Pleasingly, thanks to its fast-growing online retail business and expansion into countless other verticals, I believe Kogan.com can continue growing at an above-average rate for some time to come.

Don't miss these mid cap stars: 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 Helloworld 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.