REA Group Limited (ASX: REA) shares, XERO FPO NZX (ASX: XRO) shares and Class Ltd (ASX: CL1) shares have been rallying in 2017.
Nonetheless, here's why I still have these three companies on my long term investment watchlist.
REA Group
REA Group is the owner of realestate.com.au, Australia's leading property portal. It also has stakes in other property listing businesses, like iProperty Group and Move Inc. The company has grown rapidly thanks to an unwavering focus on user experience, a first mover advantage, industry tailwinds and savvy investment.
The company continues to grow its profit at a healthy clip. However, if investors want to buy shares they'll have to pay up. The REA Group share price trades at 36 times profit with a 1.4% dividend.
Xero
Xero is the New Zealand-based accounting software business. The company is a dominant force, continually growing its network via geographical expansion and a better user experience. Accountants say that although Xero's products are more expensive than others it is worth paying for.
The company is unprofitable and does not pay a dividend. However, it continues to grow its subscriber base fiercely and could make for an ideal ultra-long-term investment, in my opinion.
Class
Class is a small company, with a market capitalisation of just $360 million and a 1% dividend. Like Xero, Class's software can be found in the cloud. Its two products, Class Portfolio and Class Super, are used by accountants and financial advisers to administer investment portfolios and self-managed superannuation funds (SMSFs).
At today's prices, Class shares do not appear cheap but like REA Group and Xero it could be a long-term winner for patient shareholders.
