I'm a big fan of investing in the mid cap side of the market.
This is because it generally offers greater potential returns that the large cap space, but usually comes with less risk than the small cap side of the market.
Three mid cap ASX shares that I would buy this month are listed below:
Collins Foods Ltd (ASX: CKF)
Collins Foods is a quick service restaurant operator which is best-known as an operator of KFC restaurants across Australia, Europe, and New Zealand. It also operates Sizzler restaurants in Asia and is busy rolling out Taco Bell restaurants across several Australian states. Although I think the latter has a lot of promise and could be a driver of growth over the coming years, I still see the rollout of KFC restaurants in Europe as the key to its future success. This market is surprisingly under penetrated and offers Collins Foods a significant runway for growth.
Jumbo Interactive (ASX: JIN)
Jumbo is an online lottery ticket seller, best known as the operator of the Oz Lotteries website. It has been a very strong performer over the last few years and has delivered explosive earnings growth. And whilst its growth is due to slowdown notably this year, it is worth remembering that this is due to the investments it is making in order to achieve its growth targets. In light of this, I believe it is worth sticking with the company during this short term pain for the potential long-term gains. Jumbo is aiming to achieve $1 billion in ticket sales through the Jumbo platform by FY 2022. This will be triple what it achieved in FY 2019.
Kogan.com Ltd (ASX: KGN)
Kogan is a growing ecommerce company and Australia's answer to Amazon. It disappointed the market earlier this year when it revealed a sharp slowdown in its growth during the latter part of the first half. Whilst I can't say I'm surprised that investors headed to the exits, I think the extent of the selling was overdone and has created a buying opportunity for long-term focused investors. After all, it has a strengthening market position, a number of new and potentially lucrative verticals, and favourable tailwinds that look set to underpin very strong sales growth over the next decade. However, if the past is a guide, it may not be the smoothest ride.
