Top 5 Asx Stocks Next 10 Years
From a long-term perspective, Australia’s economic growth remains subtle given its large area, relatively low population, and proximity to major Asian economies. Australian trade is already oriented towards Asia’s economies, particularly in minerals, energy, services, and agriculture. Economic diversity and productivity are resilient against economic debacles. The real GDP growth of Australia is estimated to slow from 1.9% in 2023 to 1.4% in 2024 before recovering to 2.1% in 2025. The cumulative impact of interest rates and cost of living pressures will drive a cut in spending by households and businesses over the upcoming period. The spending cut will be partially offset by continued strong working-age population growth and the ongoing recovery in education and tourism exports. The unemployment rate is projected to rise moderately, reaching 4.4% by mid-2025. Inflation is expected to moderate; however, inflation of some service components is estimated to remain elevated throughout 2024.
During the September quarter, Australia’s GDP increased by 0.2% on account of rising government consumption levels and capital investment. Nominal GDP rose 1.2%. The GDP implicit price deflator (IPD) was increased by 1.0% due to continued strength in domestic prices. The domestic final demand for IPD rose 1.3% and remained elevated near 30-year highs throughout the year (+5.2%). Prices for essential household consumption drove the rise, particularly in housing rent, fuel, and communications. The government expenditure contributed 0.2%, driven by social benefits to households. Capital investment contributed 0.2% to GDP, led by new investment by public corporations. Health care and social assistance rose 1.8% with strength from the National Disability Insurance Scheme (NDIS) and the Medicare Benefits Schedule (MBS). Transport, postal, and warehousing reported, increased by 1.4%, reflecting the introduction of next-day mail services along with the continued growth momentum in international travel. Mining (-1.0%) activity detracted from growth as planned and unplanned maintenance disrupted production across a number of mine sites. Agriculture (-3.5%) declined due to dryer conditions. Electricity, gas, water, and waste services fell 2.6%, with warmer than usual conditions reducing demand for heating in the quarter.
Reference: Australian Bureau of Statistics.
We expect some of the ASX-based shares may have the potential to outperform the index multiple times in the next 10 years’ time period. Let's take a look at these identified ASX gems that could turn fortune for investors' fates:
Medibank Private Limited (ASX: MPL)
Medibank Private Limited (ASX: MPL) has a market capitalization of $9.60 billion and a share price of $3.485 as of 7 December 2023.
The company managed to record a revenue growth of 3.2%, from $7,128.5 million in 2022 to $7,355.3 million in 2023. The corresponding net profit after tax (NPAT) increased by 29.8%, from $393 million in 2022 to $511.1 million in 2023. The group operating profit increased 9.0% to $647.5 million, driven by strong growth in health insurance operating profit of 9.8%, partly offset by a decline in Medibank Health segment profit of 2.9%. There was a significant increase in net investment income of $163.4 million, which supported an increase in NPAT growth in 2023. The underlying NPAT, which adjusts for the normalization of investment returns, increased 14.8% to $499.6 million. The company is targeting $20 million in productivity savings across FY2024 and FY2025.
PharmAust Limited (ASX: PAA)
PharmAust Limited (ASX: PAA) has a market cap of $34.88 million and a share price of $0.10 as of 7 December 2023.
harmAust continued to report progress in its research and development, an aspect constituting a majority of the company’s operations with a single drug in focus, MPL. The trials continue to report positive results. The data for MND/ALS will commence to be analyzed soon. A 12-month Open Label Extension (OLE) study is further being finalized for ethics approval.
The progress with canine B-cell lymphoma was also positive, and the development can significantly ramp up given the recent ideal results in the performance of the drug towards increasing life expectancy and quality.
Dimerix Limited (ASX: DXB)
Dimerix Limited (ASX: DXB) has a market cap of $60.72 million and a share price of $0.143 as of 6 December 2023. Dimerix signing an exclusive agreement with ADVANZ PHARMA has the potential to result in it receiving up to ~AU$230 million in upfront and milestone payments, plus royalties of €6.5 million (~AU$10.8 million) in upfront payments and up to €132 million (~AU$219 million) in potential milestones. Dimerix will also receive tiered royalties on net sales.
Spartan Resources Ltd. (ASX: SPR)
Spartan Resources Ltd. (ASX: SPR) has a market cap of $457.95 million and a share price of $0.48 as of 6 December 2023. The company has significant new high-grade “look-alike” targets confirmed along strike to the south of 721 koz Never Never Gold Deposit at an exceptional head grade of 5.85 grams per tonne. A new 25,000-m surface drilling campaign is underway, targeting the next leg of rapid growth of high-grade gold resources on the granted mining lease of <2km of the 2.5 Mtpa Dalgaranga Process Plant.
Nuix Limited (ASX: NXL)
Nuix Limited (ASX: NXL) has a market cap of $594.90 million and a share price of $1.85 as of 6 December 2023. The most transformational initiatives that underpin the company’s strategy refresh work have progressed, notably the Nuix NEO unified platform, the launch of XLR8 to reset Nuix messaging to facilitate customer involvement, and the Rampiva acquisition. Nuix, through its successful rollout of its ‘Nuix Neo platform’ to early adopters and associated solutions like data privacy, will underpin significant growth momentum in the medium term.
The company has a predetermined strategic target set for FY2024 that aims at around 10% ACV and statutory revenue growth on a constant currency basis. The newly launched platform offerings will add significant value for existing customers and open up new customer opportunities.
*All Data has been sourced from Company announcements and Refinitiv, Thomson Reuters
Frequently Asked Questions (F.A.Q)
What are the top financial services companies on the ASX?
The ASX market has multiple financial services companies that range from banking, insurance, asset management, and share brokerage businesses. The leading bank shares constitute a significant component of the ASX financial sector. Some of the prominent names are Commonwealth Bank of Australia (CBA), Westpac Banking Corporation (WBC), ANZ Group Holdings Ltd. (ANZ), and National Australia Bank Ltd. (NAB), etc.
Which stocks should I buy for the next 10 years?
Taking into consideration various developments and the company’s fundamentals, we assume a few companies could have strong future prospects, such as PharmAust Limited (ASX:PAA), Nuix Limited (ASX:NXL), and Dimerix Limited (ASX:DXB).
What are the best ASX shares to buy?
In our opinion, PharmAust Limited (ASX: PAA) and Nuix Limited (ASX: NXL) may be the best ASX shares to look at. These companies may have the potential to face the headwinds and continue to perform well; however, investors need to incur more risk and should do due diligence before investing in the following companies. When investing in ASX companies, one will be responsible for their own investments.
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