While I’m not completely convinced that the market has bottomed just yet, now does seem like a good time to start plotting some investments.
Listed below are two ASX 200 shares that I am seriously considering investing $10,000 in soon. Here’s why I think they could be great long-term investments:
CSL is arguably one of the highest-quality companies that Australia has ever produced. So, when you’re offered the chance to purchase this ASX 200 share at a 14% discount to its 52-week high, it’s hard to say no.
Especially given that plasma collections have improved markedly since the height of the pandemic. Plasma is a key ingredient in CSL’s therapies and had been harder to collect over the last couple of years, which weighed on costs. However, collection levels are now back to normal, which bodes well for CSL’s margins. In addition, the launch of new plasma collection technology looks set to boost yields.
And let’s not forget the acquisition of Vifor Pharma, which has opened the door to new lucrative markets, and CSL’s US$1.1 billion annual spend on research and development activities.
The latter ensures that CSL’s product pipeline is filled to the brim with potential therapies that could provide its sales with a material boost in the coming years.
For example, the company’s Clazakizumab therapy is undergoing phase three trials for the treatment of chronic active antibody mediated rejection in kidney transplant recipients. If successful, Goldman Sachs sees potential for peak sales of US$5.4 billion from the therapy.
All in all, in my opinion, the future looks as bright as ever for CSL.
Another ASX 200 share that I am considering is integrated property company Goodman Group. Its shares have fared even worse than CSL’s and are trading around 37% lower than their 52-week high.
Investors have been selling Goodman and other property companies this year amid rising rates and concerns over economic growth.
The good news is that last week Goodman released its first-quarter update and stated that it was in “a strong position to withstand and respond to the impacts of a slowing economy in different parts of the world”.
This is “due to the demand for our strategic locations, quality of our assets, [and] strength of our development book.” The latter comprises $13.8 billion of development work in progress across 85 projects.
What Goodman said certainly appears true based on its quarterly performance. The company recorded solid rental growth, a 99% overall occupancy rate, and 100% occupancy on new developments.
In light of this, its significant share price weakness, and guidance for 11% earnings growth, I believe its shares are great value at around 19x forward earnings.