Owning the highest-quality ASX shares can deliver excellent returns because of the power of their brands, financials, market share and management.
Over the long-term, I'd expect a high-quality business to deliver more profit growth and share price growth compared to a mediocre company.
Of all of the options that Australians could choose for their portfolios, there are few options as high-quality as the ones below.
Pro Medicus Ltd (ASX: PME)
I believe Pro Medicus is one of, if not the, highest quality ASX shares. It describes itself as a leading healthcare informatics company. The company provides a full range of medical imaging software and services to hospitals, imaging centres and healthcare groups worldwide
Pro Medicus has incredibly high profit margins. In FY25, the company generated revenue of $213 million and it produced net profit after tax (NPAT) of $115.2 million with $157.7 million of underlying operating profit (EBIT). Its underlying EBIT margin of 74% is incredible.
A very large amount of new revenue is turned into profit. FY25 saw 31.9% revenue growth and 39.2% net profit after tax (NPAT) growth, which has helped propel Pro Medicus' share price higher. It continues winning new multi-year contracts, which will translate into significantly larger revenue in the coming years.
It is also successful at renewing contracts at a higher fee rate, as well as selling additional modules to existing customers.
It may still trade on a high price/earnings (P/E) ratio, but it's lower now after falling by more than 20% since mid-July 2025.
According to the forecasts on CMC Markets, the ASX share is trading at 124x FY27's estimated earnings.
VanEck MSCI International Small Cos Quality ETF (ASX: QSML)
I think small companies have tremendous growth potential because they are usually much earlier on with their growth journeys – they can still significantly scale from where they are today.
But, investing in small businesses can come with risk, so I'd want to only own good ones. How do you pick out the best ones to own? The QSML ETF could be an excellent option for a few reasons.
The exchange-traded fund (ETF) implements a few quality screening tests to ensure it just invests in the best of the best.
The QSML ETF only invests in businesses with a high return on equity (ROE), good earnings stability and low financial leverage. In other words, these businesses make high levels of profit on retained shareholder money, profit is usually growing and debt levels are low.
It invests in 150 of these high-quality small companies from across the world, with different sectors represented in the portfolio, so it's a diversified investment. Pleasingly, over the last three years, it has returned an average of 16% per year. I think this could still be a great time to invest in these small global companies for the long-term.
