Should you buy these fast-growing food shares?

Due to growing populations at home and in Asia, there is an increasing number of mouths that need feeding.

I believe that this has positioned many of Australia’s food companies perfectly to profit over the long-term.

With that in mind, should you buy these fast-growing food shares?

A2 Milk Company Ltd (ASX: A2M)

One of my favourite shares in the space would have to be a2 Milk Company. I’ve been very impressed at the way the company has grown its share of the Chinese infant formula market despite increasing competition. I believe a lot of this comes down to the quality of its products and its positive brand image. So with its shares down significantly from their 52-week high, I feel now could be a good time to consider snapping up some with a long-term view.

Costa Group Holdings Ltd (ASX: CGC)

Last week this horticulture company held its annual general meeting and released a trading update. At the meeting the company reaffirmed its guidance for low double digit NPAT-S growth for the 12 months ending June 30. In addition to this, it reconfirmed its long-term guidance for an average trajectory of low double digit annual average NPAT-S growth over a three to five year horizon. I believe Costa is more than capable of delivering on this, especially given its expansion plans. This could make it worth considering a long-term investment in its shares.

Freedom Foods Group Ltd (ASX: FNP)

Freedom Foods is a healthy food and UHT producer which I think is well-positioned to grow strongly over the next few years. In an update released this morning, management confirmed that it continues to experience strong demand across its business activities in Australia, China and SE Asia. As a result, it is on course to achieve net sales revenue in the range of $500 million to $530 million in FY 2019. Furthermore, it expects new product revenue streams from major capital expenditure projects to have a materially positive impact on sales and earnings into FY 2020 and beyond. While its shares are expensive, I feel its long term growth potential could justify the premium.

Finally, if you like growth shares like a2 Milk Company then check out these top mid cap tech shares that have been tipped for big things.

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Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of and has recommended COSTA GRP FPO. The Motley Fool Australia owns shares of A2 Milk. The Motley Fool Australia has recommended Freedom Foods Group 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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