Are these the best Australian shares to buy for long term? [2023]

There's no precise formula to always determine the best growth stocks and future results in the market. Many Australian investors seek comfort in the traditional large companies paying dividends and others look for small caps in a growth area. The past year has challenged those focused on share trading and looking beyond the near future with an investment approach targeting growth stocks that might prove valuable. Australian shares have returned 8.33% annually over the past 10 years, and investors will continue to seek the best shares to buy in Australia for those long term results.

Top 10 long term stocks on ASX

*The list of stocks mentioned are ranked by market capitalisation. When deciding what stocks to feature, we analyse the company's financials, recent news, advancement in their timeline, and whether or not they are actively traded on Stake.

Data as of 4 April 2023

👉 Learn more about Stake pricing to discover how seamless investing can be.

Discover these long term Australian stocks to watch

1. Mineral Resources Limited ($MIN)

Market Capitalisation: $15.26b

Stock price (as of 04/04/2023): $79.15

Stake Platform Bought / Sold (1 Jan 2023 - 31 Mar 2023): 64% / 36%

This mining company holds stakes in two of Australia's largest lithium mines - Mount Marion and Wodgina. Mineral Resources is also the nation’s fifth largest iron producer, a holder of gas exploration projects and provider of a range of mining services to other companies. It’s assisted by multiple revenue streams and potential future growth plans.

As the market recognised the great amounts of commodities required to power the energy transition Mineral Resources' share price rose 37.8% in 2022. The increases in lithium production and the addition of a processing plant to produce lithium hydroxide are likely to increase profit margins this year.

🆚 Compare MIN vs CXO→

🆚 Compare MIN vs PLS→

2. CSL Limited ($CSL)

Market Capitalisation: $140.59b

Stock price (as of 04/04/2023): $291.47

Stake Platform Bought / Sold (1 Jan 2023 - 31 Mar 2023): 61% / 39%

CSL is a speciality biotechnology company with expertise in rare and serious diseases, flu vaccines, iron deficiency and kidney diseases. By growing research and development investment by 17% in 2022 this large cap maintains a sustainable growth strategy. The firm presents an unusual healthcare stock option that did not skyrocket during the pandemic years.

It has largely recovered from the disruption caused by Covid-19 on blood plasma collections and this progress should renew sales of core products. FY22 saw a gross profit of $5.7b, its second highest after the previous year's $5.8b. Looking forward from FY2023, analysts are bullish on the company's earning potential, projecting increases in net income for at least the next three years.

CSL also benefits from a diverse revenue base, nearly 50% comes from North America, 24% from Europe, 21% from Asia Pacific and 6% from other areas.

💡Related: Top 10 Dividend ETFs in Australia→

3. Nickel Industries ($NIC)

Market Capitalisation: $2.72b

Stock price (as of 04/04/2023): $0.90

Stake Platform Bought / Sold (1 Jan 2023 - 31 Mar 2023): 55% / 45%

Nickel Industries engages in the mining and production of nickel ore through its mining operations predominantly based in Indonesia. Its main products include nickel, nickel ore, and nickel pig iron. The company was incorporated in 2007 in Australia, and commenced mining operations in Indonesia two years later after acquiring an 80% interest in Hengjaya Mine.

The company IPO’d just in 2018, but despite its short history, Nickel Industries has been able to grow its revenue exponentially in the last few years – from $18.3m in 2018 to $1.2b in FY2022. Not only that, the company has already begun paying out dividends at a yield of 4.4%.

Nickel Industries continues to grow through acquiring majority stakes in a number of projects across Indonesia, and analysts estimate revenues in FY2023 to reach $1.97b, over 50% increase from its FY2022 revenues.

4. Altium Limited ($ALU)

Market Capitalisation: $5.16b

Stock price (as of 04/04/2023): $39.24

Stake Platform Bought / Sold (1 Jan 2023 - 31 Mar 2023): 49% / 51%

Altium Limited is known for its automation software that provides electronic designs to engineers working with printed circuit boards (PCBs). It’s used across a range of industries including automobiles, aerospace and telecommunications. 

FY22 saw group revenues increase 23% to $220.8m. The cloud platform has proved a popular addition to the Altium Design software, growing its share of total revenue from 16% to 30% in the past year. While its momentum is expected to slow down in the next few years, analysts still expect positive growth in both revenues and net income.

The company is likely to benefit over time from chip shortages, geopolitics pushing manufacturing into more varied locations and general growth of electronic devices.

5. Wisetech Global Limited ($WTC)

Market Capitalisation: $22.28b

Stock price (as of 04/04/2023): $67.76

Stake Platform Bought / Sold (1 Jan 2023 - 31 Mar 2023): 63% / 37%

Wisetech provides software solutions to logistics companies, helping to keep global trade running smoothly. The company now serves the world's top 25 freight forwarders and its Cargowise platform helps 41 out of the top 50 global third party logistics providers have instant access to the same information across the company's databases. 

The supply chain crisis demonstrated that businesses need to protect themselves against a frail system and stay ahead of the competition in terms of logistics. FY22 total revenue was up 25% to $632m, despite the headwinds of a lower Australian Dollar. The business has an enviable gross profit margin of, on average, 87%. Although the company's clients are impacted by general economic conditions, the ASX performance has shown resilience after earlier falls in 2022. With supply chain issues slowly getting resolved, Wisetech's performance is expected to improve, with the revenues from the first half of FY2023 already at $423m.

6. Sonic Healthcare Limited ($SHL)

Market Capitalisation: $16.83b

Stock price (as of 04/04/2023): $35.87

Stake Platform Bought / Sold (1 Jan 2023 - 31 Mar 2023): 62% / 38%

Sonic Health's consistent growth since its establishment in 1987 has shaped the company into the world's third largest pathology medicine provider. Alongside operations in eight countries, Sonic Health is a leading provider of various medical services across metropolitan and rural Australia. 

The past few years have highlighted the importance of a strong healthcare sector and the impressive real world impact of medical research. FY22 saw an increase in revenue by 7% to $9.3b and achieved a record net profit of $1.5b. Sonic has noted the challenge ahead as Australia's need for Covid-19 testing slows down. The companies has invested $628m in acquisitions and joint ventures to spur future growth.

7. Amcor PLC ($AMC)

Market Capitalisation: $24.78b

Stock price (as of 04/04/2023): $16.75

Stake Platform Bought / Sold (1 Jan 2023 - 31 Mar 2023): 69% / 31%

Amcor PLC is an Australia-American corporation that produces packaging solutions for food, beverage and other industries. The company traces its history back to an 1860 paper mill in Melbourne. In the 1980s, Amcor expanded into a range of packaging types through partnerships and acquisitions to serve global markets.

Amcor increased net sales by 3% to $3.7b in the last quarter (ending March) and benefits from being able to pass on higher raw material costs to its buyers. It's in a coveted position, having the ability to reduce risk of inflation against profit margins. Amcor's growth path targets sustainability and it’s working on more recyclable designs. Investors benefit from an average 4% dividend yield.

8. Infratil Limited ($IFT)

Market Capitalisation: $6.24b

Stock price (as of 04/04/2023): $8.63

Stake Platform Bought / Sold (1 Jan 2023 - 31 Mar 2023): 74% / 26%

Infratil is an infrastructure investor that holds a diversified portfolio of renewable energy, digital infrastructure, healthcare and airport assets. These are industries with strong growth prospects and provide investors with exposure to unlisted companies. The firm has an extensive investing track record of 29 years that covers global markets. 

In September 2022, they held stakes in 12 companies. While the company hasn't made any significant M&A transactions since then, analysts still expect Infratil to grow from a net loss in FY2022 to an income in FY2023. With a sizeable NZ$522m in cash available as at September, Infratil is ready to support existing and enter into new investments.

9. Core Lithium Ltd ($CXO)

Market Capitalisation: $1.49b

Stock price (as of 04/04/2023): $0.80

Stake Platform Bought / Sold (1 Jan 2023 - 31 Mar 2023): 68% / 32%

Core Lithium's Finniss Project is expected to bring new lithium concentrate supplies onto the market in the first half of 2023. It benefits from being located near Darwin in the Northern Territory, Australia's nearest port to key export partners in Asia. The completion of a $100m equity raising in October 2022 means near term activities are funded. This includes further exploration of additional prospects nearby. 

Low production costs and a healthy amount of working capital as of December 2022 should also help insulate the business in the case of a market downturn. Although past performance is no guarantee and trying to time commodity booms can be a high risk choice, the c in a relatively secure position compared to earlier stage ventures. Core Lithium was one of the top lithium stocks for Stake investors in 2022 and continues to be one of the most traded Australian shares on our platform.

10. Elders Limited ($ELD)

Market Capitalisation: $1.34b

Stock price (as of 04/04/2023): $8.58

Stake Platform Bought / Sold (1 Jan 2023 - 31 Mar 2023): 83% / 17%

Elders Limited has almost 180 years of agribusiness knowledge and provides services to primary producers across the production cycle. The company also has real estate, insurance and home loan units. Along with a top-tier beef cattle feedlot in NSW and a premium food distribution model in China, this could be the best stock for access to local farming.

During FY22 sales were up 35% to $3.4b, supported by high fertiliser price growth. Although news of the CEO's departure bruised the stock market performance for a while, strong growth fundamentals are likely to support future improvements. There is consistent demand for food from the now 8 billion humans and increasingly unstable weather patterns mean added pressure on producers.

Long term ASX stocks FAQs

What have been the best long term stocks over the last 10 years?

The Australian stock market has revealed a few surprises amongst the best performing ASX shares in terms of share price over the last decade.

Lithium miner Pilbara Minerals ($PLS) was the winner with an astonishing 17,700% share price gain over this period. The battery theme continued with fellow mining and chemical business Allkem also showing an astounding return of 853%.

Pro Medicus, Altium, Zero, Technology One and Wisetech represented Australia's emerging software success. Aside from the small cap bias, larger quality performers included gaming company Aristocrat and medical device maker Fisher & Paykel.

However, overall top returns doesn't mean a company's financial situation was always stable. Things paid off for those held on for A2 Milk's wild ride, while big dividends may have been better for others.

🎓 Learn more: Long-term investing tips: 10 Things to remember→

What are some popular long term stocks on the U.S. market?

One simple way of gaining exposure to growth stocks in the USA is investing in Warren Buffet's Berkshire Hathaway ($BRK). After all, his favourite holding period is forever.

Other popular options are large companies with everyday basics such as Dover ($DOV) and Johnson & Johnson ($JNJ). They are on their way to becoming truly international shares and are likely to hold strong against changing interest rates.

Even downturns can provide opportunities. It could be a convenient time to catch tech giants Google ($GOOGL) and Amazon ($AMZN) at a lower price.

Which Australian ETFs had the best returns over the last 10 years?

The majority of products in the Australian ETF market are relatively new and most past performances often don't even extend to 10 years. The locally focused ETFs with the best-annualised returns tend to mirror the general Australian stock market and sector gains. Learn more here about the best performing ETFs.

The Vanguard MSCI Australian Large Companies ($VLC) had a return of 7.44% per annum from Australia's 20 largest companies and the small caps in Vanguard MSCI Australian Small Companies ($VSO) held strong at 6.94%.

Popular ASX-300 products such as the Vanguard Australian Shares Index ($VAS) returned 7.83% annually over the last 10 years. High yield ETFs were also popular and achieved similar returns to general ASX options, as they tend to contain the same stocks.

Property proved the best sector ETF with Vanguard Australian Property Securities ($VAP) achieving 8.29%, ahead of financials with SPDR S&P/ASX 200 Financials EX A-REIT ($OZF) at 5.52%. Resources have been strong with top performer BetaShares Australian Resources Sector ($QRE) at just 8.95%.

💡Check out the top Vanguard ETFs in Australia for a bigger list of funds with positive returns.

This does not constitute financial product advice nor a recommendation to invest in the securities listed. Past performance is not a reliable indicator of future performance. As always, do your own research and consider seeking appropriate financial or taxation advice before investing.