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2 high quality blue chip ASX shares to buy

Are you wanting to buy some blue chip ASX shares for your portfolio? If you are, then I would suggest you check out the ones listed below.

These quality companies could have the potential to grow strongly over the next decade. As a result of this, they have been tipped as blue chips to buy. Here’s why:

REA Group Limited (ASX: REA)

The first ASX blue chip share to look at is property listings company REA Group. Over the last few years it has had to contend with a mini housing market crash and a pandemic. But despite this, the company has shown how resilient its business model is by coming out on top and delivering solid financial results.

The good news is that the housing market is improving, mortgage loan growth is accelerating, and house prices have been tipped to rise strongly in 2021. This is likely to lead to higher listing volumes over the next 12 months and could result in an acceleration in its profit growth. Especially given its new revenue streams, cost cutting, and potential price increases.

This morning Morgan Stanley retained its overweight rating and lifted its price target on the company’s shares to $175.00.

ResMed Inc. (ASX: RMD)

Another blue chip to consider is ResMed. It is a medical device company with a focus on sleep disorders.

Despite the pandemic’s negative impact on sleep disorder diagnoses and referrals, ResMed has continued to grow strongly over the last 12 months. This has continued in FY 2021, with ResMed recently releasing a strong second quarter update.

For the three months ended 31 December, the company delivered a 9% increase in quarterly revenue to US$800 million and a 17% increase in net profit to US$206.4 million.

Pleasingly, it still has a long runway for growth ahead of it. In fact, management has set itself a goal of improving 250 million lives in out-of-hospital healthcare in 2025. Helping it achieve this goal will be its rapidly growing digital health ecosystem, which reached over 12 million cloud connectable medical devices in 2020. This provides ResMed with strong recurring revenues and a material amount of high quality data.

Analysts at Morgans are positive on its future. They currently have an add rating and $30.99 price target on its shares.

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 February 15th 2021

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia has recommended REA Group Limited and ResMed Inc. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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