I think there are some top ASX growth shares that you should never sell.
There are some businesses that have long-term growth potential and are likely to be integral parts of our society for a very long time.
When you hold a quality business that offers important products or services then they're more likely to deliver solid returns over the long-term.
Here are three ideas:
Growth share 1: CSL Limited (ASX: CSL)
CSL is Australia's biggest business, but I believe it still has plenty of growth potential for years to come.
If you don't know what CSL does, it's a biotech company that develops biotherapies and influenza vaccines. Its products are used around the world to treat immunodeficiencies, bleeding disorders, hereditary angioedema, alpha 1 antitrypsin deficiency and neurological disorders. It's one of the biggest plasma collection businesses. These services are going to be important for a very long time – human biology isn't likely to change much over time. The ASX growth share could continue to develop new treatments to diversify its earnings – it invests heavily in research and development.
At the moment it's also involved in trying to find a healthcare treatment for COVID-19.
After many years of strong growth, CSL is predicting that FY20 profit will be between US$2.11 billion to US$2.17 billion – this would be growth of 10% to 13% compared to FY19. The company could continue to generate decent compound growth of its profit over the long-term, meaning the shareholder returns should also be pretty good for the long-term too.
It's trading at 34x FY22's estimated earnings at the current CSL share price.
Growth share 2: Altium Limited (ASX: ALU)
Altium is one of the most promising ASX growth shares in my opinion. It's an electronic PCB software business that helps engineers design the items, devices and vehicles of the future.
The software business has quite sticky revenue. It would take a large amount of training to change to another software business. As long as Altium keeps giving its clients a good, regularly-updated product then I think it has a good chance of achieving its goal of becoming the clear global leader in its industry. It's aiming for 100,000 Altium Designer subscribers by 2025. This will help it achieve US$500 million revenue by 2025.
Its client base features many of the world's most important technology businesses. Altium has effectively embedded itself into our society by providing its services to clients. Some of its most recognisable clients are: Amazon, Apple, Disney, Google, Boeing, Lockheed Martin, Tesla, Space X, NASA, Microsoft, Bosch, Honeywell and Fitbit.
The ASX growth share has plenty of attributes you'd want from a business. It's debt free. It has a growing cash balance, it has a growing profit margin and Altium is increasing its market share. Altium has aligned and focused management. It has a global revenue base. It's regularly growing its dividend.
Altium is an important business for helping the world's development of new technology. At the current Altium share price it's trading at 50x FY22's estimated earnings and I think it could be a solid growth company over the next decade.
Growth share 3: A2 Milk Company Ltd (ASX: A2M)
A2 Milk has been a great ASX growth share over the past five years. I think that could continue as the business is steadily building its market share in China. It's rapidly increasing its distribution footprint in the US.
The infant formula and other dairy products that A2 Milk sells is important. We all need nutrition.
I think A2 Milk offers an attractive combination of defensive earnings and growth. For me, one of the most exciting aspects about A2 Milk is how many more countries that the company can expand into – it has a very long growth runway for this reason. It will soon be generating earnings in Canada after a licensing agreement with Agrifoods.
The ASX growth share has no debt and a large cash balance which could be used for shareholder returns or acquisitions.
At the current A2 Milk share price it's trading at 29x FY22's estimated earnings.
Foolish takeaway
I think each of these ASX growth shares have great long-term growth potential. I think A2 Milk could produce the strongest returns over the next five years as it's priced the cheapest and has a lot of regions it can still grow in. I'd buy A2 Milk first for my portfolio.
