At the weekend I looked at how $20,000 investments fared in a number of popular ASX shares over the last five years. You can read about their staggering returns here.
But that was then and this is now. Which shares should you invest $20,000 into today?
I have picked out two ASX shares that I think could be great places to invest these funds:
a2 Milk Company Ltd (ASX: A2M)
The first share to consider investing $20,000 into is a2 Milk Company. I think the fresh milk and infant formula company could be a top option due to its positive long-term outlook. After growing its earnings at a rapid rate over the last few years, I'm confident a2 Milk's strong form can continue for some time to come.
This is due to the long runway for growth it has in the massive China market. Although it is generating significant revenues in the key market, it still only has a very modest market share. Given its strong brand, expanding distribution footprint, and a2-only differentiation, I believe it can increase its share materially in the future. In addition to this, its expanding fresh milk footprint in the United States and its sizeable cash balance should be supportive of future growth. The latter gives a2 Milk Company the option to accelerate its growth in the coming years through potential earnings accretive acquisitions. The recent appointment of a new CEO with M&A experience appears to be a big positive in that regard.
Pushpay Holdings Group Ltd (ASX: PPH)
The majority of companies out there have been negatively impacted in some way by the pandemic. But this donor management platform provider for churches isn't one of them. The pandemic had an immediate impact on churches. From shifting to online services, to ensuring members could safely tithe, church leaders quickly embraced new technologies.
This led to strong customer growth and even stronger recurring revenue and profit growth for Pushpay in FY 2020. The good news is that these positive tailwinds remain strong in FY 2021, with management expecting to double its operating earnings over the 12 months. Pleasingly, even if Pushpay delivers on this bold target, which I expect it will, it will still only be scratching at the surface of its total addressable market. This gives it a significant runway for growth over the next decade.
