There are a select few businesses on the ASX where each share is trading at over $100 per share.
Four of the most well-known include:
Macquarie Group Ltd (ASX: MQG) shares are trading at almost $115.
Blackmores Limited (ASX: BKL) shares are trading at just over $117.
CSL Limited (ASX: CSL) shares are now just over $188.
Cochlear Limited (ASX: COH) shares are now valued at nearly $187.
Does it matter how much each share is trading at? Not really, but it can make it hard to accumulate shares if they’re trading at such a high price and you only have $500 to invest.
A share price may signal that the business has grown significantly since its initial listing price of, for example, $2. However, it doesn’t say anything for how expensive it is right now.
Telstra Corporation Ltd (ASX: TLS) shares are trading at around $3, yet the telco is many times larger than Blackmores.
The share price is simply a function of the total value of the business divided by the number of shares. The less shares there are the higher each share will be priced, even if the price/earnings ratios and total market capitalisations are the same whether there are 1 million shares or 1 billion shares.
In the US there are examples of much higher prices. Alphabet (Google) Class A shares are trading at over US$1,100 per share and Berkshire Hathaway Class A shares are now at US$308,000 each. Which share is better value: Berkshire Hathaway, Alphabet or CSL? The share price certainly won’t tell you.
You have to have over US$300,000 to buy just one Berkshire Hathaway Class A share, so it does limit who can buy those shares.
Of the four ASX shares I mentioned in this article that are trading above $100 I’d most likely go for CSL. Its main product is still growing at a good rate each year and it has a R&D pipeline of several other products which could easily spur the next stage of growth. However, rising interest rates could hurt it in the short-to-medium-term.
However, I think there are better valued growth shares out there than CSL such as these top stocks – one of which I really want to buy more of for my portfolio.
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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 Blackmores Limited and Telstra Limited. The Motley Fool Australia has recommended Cochlear 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.