The best time to buy ASX growth shares is when there's a bit of negativity surrounding them, but the long-term thesis still remains.
If I had $20,000 to invest into ASX growth shares, these are the ones I would choose:
REA Group Limited (ASX: REA) – $6,000
REA Group is the country's leading property portal businesses with its realestate.com.au website and an assortment of other Australian property sites.
Despite the negative housing market, REA Group's earnings and price increases has continued to be impressive. These are the types of businesses you want to own in your portfolio.
Over the long-term I believe its international website investments in Asia and the US could become as important and as strong earners as the group of Australian sites.
REA Group is currently trading at 26x FY20's estimated earnings.
Challenger Ltd (ASX: CGF) – $5,500
Challenger is the country's leading annuity business that turns a retiree's capital into a guaranteed source of income.
As Australia's retiree population grows the number of potential customers also grows – the number of people over 65 is projected to grow by 40% over the next decade. The growing pool of superannuation money also helps the potential capital inflows to Challenger.
I think now is a good time to consider Challenger at this share price whilst there is negativity surrounding asset prices, which affects Challenger's earnings and balance sheet.
Challenger is trading at 12x FY20's estimated earnings.
Costa Group Holdings Ltd (ASX: CGC) – $4,000
Costa is Australia's largest horticultural business and has plans to keep growing strongly for a number of years. It grows tomatoes, mushrooms, citrus fruit, berries and avocados.
Expanded plantings, bolt-on acquisitions and better efficiencies make Costa an interesting business to consider.
I think now is a particularly good time to consider shares after it has fallen 22% over the past six months due to what management say are short-term issues relating to food prices and supply.
Costa is trading at 20x FY20's estimated earnings.
Citadel Group Ltd (ASX: CGL) – $4,500
Citadel is one of the leading software suppliers to local and federal government departments. It specialises in providing software in defence, health, education and security. It allows management to make real-time decisions in complex environments with secure information. At least, that's how the company promotes itself.
The point is that Citadel has a number of high-quality customers where it receives regular, contracted cashflow. Its software gives it a lot of flexibility to try to attract new customers in slightly different industries and management are considering expanding overseas, which would significantly increase Citadel's total addressable market.
Citadel is currently trading at 20x FY20's estimated earnings.
Foolish takeaway
I think each of these companies is trading at attractive long-term value, which is why I found it hard to pick one particular winner. In my opinion, each of them have the capability of beating the ASX market over the next three years.
