There are a large number of blue chips for investors to choose from on the Australian share market.
But three blue chips which I believe are among the highest quality options are listed below. Here’s why I think they would be top long term investments:
CSL Limited (ASX: CSL)
I think this biotherapeutics company is one of the best blue chip shares you can buy. This is due to my belief that it is well-positioned to continue growing its earnings at a solid rate long into the future once the pandemic passes. I expect this to be driven by its world class portfolio of therapies and vaccines, its growing plasma collection network, and its research and development (R&D) pipeline. In respect to the latter, in FY 2020 the company invested ~US$900 million into its R&D activities. It expects to invest somewhere in the region of US$1 billion more this year. Following its recent R&D update, I’m confident this money is being invested extremely well and will generate a compelling return for shareholders over the 2020s.
Goodman Group (ASX: GMG)
Another blue chip ASX share I would buy is Goodman Group. I think the integrated commercial and industrial property group is the highest quality option in the property sector. This is due to its outstanding portfolio of assets, which has exposure to structural tailwinds such as ecommerce. This is achieved through relationships with companies such as Amazon, DHL, Showpo, Walmart, and Zalando. All in all, I believe these assets will be in demand for a long time and are likely to drive strong rental income growth over the next decade.
Telstra Corporation Ltd (ASX: TLS)
Finally, I think this telco giant would be a great blue chip to buy right now. Especially after a recent poor run led to its shares dropping to a multi-year low this month. Times were hard for Telstra during the 2010s, but I’m confident the 2020s will be materially better. This is thanks to the return of rational competition in the telco industry, its cost-cutting plans, the easing NBN headwinds, and its leadership position in 5G. The latter should be a big boost to its mobile revenues in the coming years and could underpin a return to growth in the near future.
Where to invest $1,000 right now
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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.
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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 CSL Ltd. The Motley Fool Australia owns shares of and has recommended Telstra Limited. 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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