Why Domino’s Pizza and these ASX growth shares are on my shopping list

Domino’s Pizza Enterprises Ltd (ASX:DMP) shares are one of three that I think growth investors ought to buy…

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One of the keys to successful long-term investing is being able to identify companies that have the ability to consistently grow their earnings long into the future.

This is important because companies are generally valued on their future earnings and a fast-growing company is typically worth a lot more than a company with declining profits.

With that in mind, here are three shares that I think have exceptionally strong growth prospects:

a2 Milk Company Ltd (ASX: A2M)

I think this New Zealand-based fresh milk and infant formula company could continue its meteoric rise over the coming years, potentially making it a great growth share to own right now. I’m bullish on the company due to its expansion in the United States and the increasing demand for its infant formula products in the lucrative China market. The latter has been a key driver of growth in FY 2019, leading to the company reporting a 42% increase in revenue for the first nine months to NZ$938 million. Despite its strong growth in China, a2 Milk still only has a very small share of the massive market and thus a significant long term opportunity.

Domino’s Pizza Enterprises Ltd (ASX: DMP)

I believe it would be worth looking past this pizza chain operator’s short term challenges due to its bold long-term expansion plans. Domino’s expansion plans will see it almost double its store footprint over the next seven years. If the company executes this successfully, it should underpin strong earnings growth over the next decade and could lead to market-beating returns for investors.

Xero Limited (ASX: XRO)

Another top growth share to consider is Xero. It is a leading cloud-based business and accounting software provider which has been growing its top line at an impressive rate over the last few years thanks to strong growth in subscriber numbers and an increase in the average revenue it is generating from each of its users. Due to its massive global market opportunity and the quality and stickiness of the product (switching accounting software is an arduous affair), I believe this tech star could be a great buy and hold option for investors today.

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Scott just revealed what he believes could be the five best ASX stocks for investors to buy right now. These stocks are trading at near dirt-cheap prices and Scott thinks they could be great buys right now.

*Returns as of August 16th 2021

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of A2 Milk and Xero. The Motley Fool Australia has recommended Domino's Pizza Enterprises 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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