The most rewarding investments often come from ASX shares you can buy and hold for a decade or more.
But finding them isn't always easy. Markets change, industries evolve, and not every company has what it takes to compound value over the long term.
So, how do you identify the best ASX shares to hold for 10 years? Here are a few key traits to look for — along with three examples that stand out today.
What to look for
The first thing is a sustainable competitive advantage. Also known as an economic moat, this is what allows a company to protect its market share and profitability from competitors.
Another thing to look for is a large and growing market. A company's growth potential is tied to the size of the opportunity in front of it. Businesses exposed to structural tailwinds are more likely to thrive over the long haul.
Strong financials are also important. You might look for low debt, recurring revenues, and high returns on capital. These signal resilience and quality.
Finally, proven execution is something to consider. A great idea means little without management teams that can deliver consistently.
With that in mind, let's take a look at three ASX shares that tick these boxes and analysts think are buys. They are as follows:
WiseTech Global Ltd (ASX: WTC)
WiseTech is a software company that has become essential to the logistics industry. Its CargoWise platform is used by freight forwarders and transport companies worldwide to manage complex supply chains.
The company benefits from sticky recurring revenue and enormous global scalability. With trade volumes expected to grow in the decades ahead, WiseTech's platform is well positioned to capture an even larger slice of the market.
Morgan Stanley currently has an overweight rating and $130.00 price target on its shares.
Life360 Inc. (ASX: 360)
Life360 has grown into one of the world's leading family safety platforms, offering features like location sharing, driving insights, and emergency alerts to over 80 million users.
Its strong growth highlights the stickiness of its app and is underpinning significant recurring revenue. And with opportunities to expand internationally and monetise free users, Life360 has the makings of a long-term compounder.
Morgan Stanley is also a fan of Life360 and has an overweight rating and $51.00 price target on its shares.
Megaport Ltd (ASX: MP1)
A third ASX share to look at is Megaport. It operates in the fast-growing world of cloud connectivity. Its on-demand software-defined network allows businesses to link into major cloud providers like Amazon Web Services, Microsoft Azure, and Google Cloud in real time.
As more companies adopt hybrid and multi-cloud strategies, Megaport is positioned as a critical enabler of that trend.
Macquarie is bullish on Megaport and has an outperform rating and $16.90 price target on its shares.
