The Motley Fool

3 ASX shares to buy for investors in their 30s

I think your 30s are the perfect time to start investing in ASX shares because you have many decades of potential compounding to take advantage of.

Last week I looked at some ASX shares that could be good for investors in their 20s, so this time I thought it would be good to look at shares for people in the next decade of their life.

If your 20s are the decade of learning, then the 30s are meant to be the decade of earning. A full-time job with a bit of career progression should provide plenty of financial ammunition to buy ASX shares.

As with investors in their 20s, it’s probably best to go for growth shares that pay a small amount of income (or none at all) so that you pay less income tax along the way.

Here are three ASX shares to consider buying for investors in their 30s:

A2 Milk Company Ltd (ASX: A2M)

The A2 Milk share price has almost recovered to its six-month high at the time of the last reporting season. The dairy business may be described as one of the best growth shares on the ASX right now. It has managed to create a luxury brand for staple food & drink items like milk, ice cream and infant formula.

For investors thinking the Chinese growth story is over, you may be mistaken.

In the first four months of FY19 the company reported revenue growth of 40.5%, earnings before interest, tax, depreciation and amortisation (EBITDA) growth of 58.5% and net profit after tax (NPAT) growth of 64.5%. This was excellent considering it has been growing impressively for years.

China store distribution increased from 10,000 stores to 12,000 stores and in the US its distribution increased from 6,000 stores to 9,000 stores. Both the Asian and US opportunities are huge if A2 can continue to grow its market share.

A2 is trading at 36x FY19’s estimated earnings.

Costa Group Holdings Ltd (ASX: CGC)

Another business that is taking advantage of Asian demand and long-term growth potential is Costa, Australia’s largest horticultural business. It grows berries, tomatoes, citrus fruit, avocados and mushrooms.

Despite a near-term profit downgrade which sent the Costa share price down at the time, it has largely recovered yet still represents good long-term value in my eyes.

The company is targeting double-digit growth of NPAT in the coming years, apart from FY19. If food price inflation returns this year then Costa’s share price could quickly go back above $6 and beyond.

International demand for fresh Australian food could be a useful driver of higher prices over time. I like that it’s growing in China, North Africa and here in Australia.

Costa is trading at 23x FY19’s estimated earnings.

BetaShares Asia Technology Tigers ETF (ASX: ASIA)

One of the best ways to take advantage of the growing Asian economy could be through investing in the leading technology businesses that operate there.

Instead of Amazon, Facebook and Alphabet, you can get access to Alibaba, Baidu and Tecent. Instead of Apple, you can get exposure to Samsung.

All of the Asian ‘BAT’ shares are growing revenue at an impressive rate each year. Although the Chinese economy is growing at a slower pace, it is still forecast to grow at more than 6% in 2019, which is a very useful tailwind for the businesses that operate there.

The constituents in the BetaShares Asia Technology Tigers ETF are trading at cheaper valuations compared to their western counterparts, with potentially better growth prospects due to how large the Asian population is.

According to BetaShares, this Asian Tech ETF has a price/earnings ratio of less than 16.

Foolish takeaway

All three of these shares have strong growth potential with proven underlying growth. At the current prices I’d probably go for Costa, but all three could easily beat the ASX index by a good margin over the next decade.

These 3 stocks could be the next big movers in 2020

When investing expert Scott Phillips has a stock tip, it can pay to listen. After all, the flagship Motley Fool Share Advisor newsletter he has run for more than eight years has provided thousands of paying members with stock picks that have doubled, tripled or even more.*

In this FREE STOCK REPORT, Scott just revealed what he believes are the 3 ASX stocks for the post COVID world that investors should buy right now while they still can. These stocks are trading at dirt-cheap prices and Scott thinks these could really go gangbusters as we move into ‘the new normal’.

*Returns as of 6/8/2020

Motley Fool contributor Tristan Harrison owns shares of COSTA GRP FPO. The Motley Fool Australia owns shares of and has recommended COSTA GRP FPO. The Motley Fool Australia owns shares of A2 Milk and BetaShares Asia Technology Tigers ETF. 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.

Related Articles...

Latest posts by Tristan Harrison (see all)