If you are looking for 2 quality ASX shares to add to your portfolio, I can recommend the following two.
Electronics retailer JB Hi-Fi has been a solid and consistent performer from a financial perspective over the past decade. The company’s full year financial results came in last week, and it has been a particularly strong year for the group.
Total sales grew solidly by 11.6% to $7.9 billion during FY 2020. Meanwhile, underlying EBIT growth was very impressive, up by 30.5% to $486.5 million.
Online sales have been very strong during the last 12 months. They totalled nearly $600 million for the group. That was up a whopping 50% on the prior year. The fourth quarter was a standout quarter for JB Hi-Fi, up with online revenues up 134%, driven by increased interest in online sales during the coronavirus pandemic.
The JB Hi-Fi share price was hit hard in the first wave of the the pandemic. However, since then it has soared and now is well above pre-COVID-19 levels.
I believe that JB Hi-Fi is well-positioned to grow strongly over the next five years, underpinned by an expanding online channel. This makes it a quality ASX share to add to your portfolio.
Fixed broadband provider Vocus also released its full year financial results recently. And like JB Hi-Fi’s, they were very well received by financial markets. The Vocus share price has surged from $2.93 prior the results release, to now be trading at $3.50. That’s an increase of 19.5% in just over a week.
Vocus’ three year turn-around strategy now appears to be well and truly on track. Record sales were recorded across all of the Vocus operating segments. Also, the newly launched Vocus brand has been well-received by the market so far.
Vocus Network Services achieved EBITDA growth of 10% to reach $223 million for FY 2020. Meanwhile, recurring revenue for this division grew solidly by 6%. However, overall recurring revenue for the group fell by 1%. Total revenues were impacted by a 9% decline in the consumer division. This was due to the impact of migration of legacy fixed-line services to lower margin NBN revenues.
Despite overall decline in overall revenue, I believe that there is potential for further growth in the Vocus share price over the next one to two years. This is likely to be be driven by further progress on the telco’s turnaround strategy.
JB HiFi and Vocus are 2 ASX shares that I believe are well-positioned for long-term growth over the next few years. This could lead to above average share price growth during this time.
Man who said buy Kogan shares at $3.63 says buy these 3 ASX stocks now
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In this FREE STOCK REPORT, Scott just revealed what he believes are the 3 ASX stocks for the post COVID world that investors should buy right now while they still can. These stocks are trading at dirt-cheap prices and Scott thinks these could really go gangbusters as we move into ‘the new normal’.
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Motley Fool contributor Phil Harpur has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. 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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