There are at least two ASX shares I'd buy if the ASX crashes again.
I'm not expecting that the ASX will crash again. But I think it's a good idea to have your investment targets lined up so you know what you'd do if the opportunity presented itself.
Some of the smaller-to-medium sized shares on the ASX have performed very well since the coronavirus low in March. If the share market pulls back, I know I'd love to jump on these two long-term winners:
Share 1: Altium Limited (ASX: ALU)
Altium is a leading electronic software business which is aiming for global market leadership by 2025. The ASX share is aiming to achieve this with 100,000 Altium designer subscribers.
The Altium share price has been a strong performer since the initial crash started in February 2020. It has risen by 38% since 23 March 2020. It was up even more before the Aussie dollar strengthened compared to the US dollar. Altium reports in US dollars, so its earnings are worth less in Australian dollar terms as the US dollar weakens.
I'd like to buy more Altium shares because I think it's one of the best ASX growth shares around.
The company has attractive and growing profit margins as it scales. It has excellent management with a long-term focus. The ASX share has a good amount of cash on the balance sheet with no debt. It even has a growing dividend.
There is a lot to like about Altium. But with the company warning of tougher conditions in the short-term, I'd prefer to buy more shares at a lower price than today. However, at a share price of $34 I think investors could still do quite well over the next five years.
Share 2: A2 Milk Company Ltd (ASX: A2M)
A2 Milk is another ASX share that has done very well since its March low. The A2 Milk share price is up 25.8% since 16 March 2020.
I have been very impressed with A2 Milk's performance since it listed on the ASX five years ago. It has already generated big returns for long-term investors.
It's one of the few ASX shares that is seeing even faster growth during this unfortunate period. People are looking to stock up on quality products to ensure their family's needs are met.
A2 Milk is one of those quality businesses that is able to invest for growth, keep building its cash balance and maintain an attractive earnings before interest, tax, depreciation and amortisation (EBITDA) margin. It can be hard to balance those things.
I think it would be a costly mistake to assume A2 Milk has already achieved most of its growth. I'm not expecting returns of over 1,000% over the next five years. But A2 Milk still has a long growth runway. It has barely begun growing in the US and it's planning to start generating earnings in Canada.
There are plenty of other countries for A2 Milk to keep growing its market share.
Foolish takeaway
I think both of these ASX shares are among the best quality businesses we can buy. Sadly, the market is pricing them highly. I wouldn't mind buying a small parcel of each today. But it would be even better to buy them if their prices were at least 15% lower. Who knows if that will happen though?
