I believe one of the best ways to generate market-beating returns and grow your wealth is to make long-term investments in high quality companies with strong business models and positive outlooks.
With that in mind, I have picked out two top ASX 200 shares that I think would be great buy and hold investments:
a2 Milk Company Ltd (ASX: A2M)
I think that a2 Milk Company would be a great buy and hold investment option. It is a rapidly growing a2 protein-only infant formula and fresh milk company. Cow’s milk will traditionally contain two main types of beta casein proteins, A2 protein and A1 protein. As you might guess from its name, a2 Milk Company’s milk comes only from cows selected to naturally produce the A2 protein type. It believes this protein is better for people who experience challenges drinking conventional cow’s milk.
This unique selling point has gone down well with consumers. It has also seemingly created sticky revenues, with consumers reluctant to switch products lest they upset their stomachs. I believe this bodes well for its future growth and expect further market share gains in China and its expanding distribution footprint in North America to drive strong earnings growth over the next decade. This could mean the a2 Milk share price still has plenty of upside over the coming years. In addition to this, there is speculation that the company may soon put its sizeable cash balance to work with new product launches or acquisitions.
Cochlear Limited (ASX: COH)
Another ASX 200 share that I think investors ought to consider buying and holding is Cochlear. I’m a big fan of the hearing solutions company and believe it has a very positive long term outlook. This is thanks to the quality of its products, its sizeable market opportunity, and its high level of investment in research and development.
I think the latter will be key to keeping its products at the front of the pack and growing its market share in the future. And in respect to its market opportunity. The company estimates that less than 10% of people who would benefit from an implantable hearing solution are treated. I feel this gives the company a long runway for growth in the coming years and could be the catalyst to driving the Cochlear share price notably higher over the 2020s.
Where to invest $1,000 right now
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.*
Scott just revealed what he believes are the five best ASX stocks for investors to buy right now. These stocks are trading at dirt-cheap prices and Scott thinks they are great buys right now.
*Returns as of June 30th
James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. owns shares of Cochlear Ltd. The Motley Fool Australia owns shares of A2 Milk. The Motley Fool Australia has recommended Cochlear Ltd. 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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