Because I have a high tolerance for risk, I'm a big fan of investing in growth shares.
Luckily for me, there are a large number of companies listed on the Australian share market that have strong long-term growth prospects.
Two which I think are among the best on the local market right now are listed below. Here's why I like them:
A2 Milk Company Ltd (ASX: A2M)
I think A2 Milk Company is one of the best growth shares on the local market. The leading dairy and infant formula company has been an impressive performer over the last few years thanks largely to the strong sales growth of its a2 Platinum infant formula. The main catalyst for this has been demand in China and from daigou shoppers in Australia.
The good news is that this strong demand doesn't appear to be waning and a2 Milk Company's market share in the lucrative market is still a reasonably modest 6.6%. I believe this gives it a long runway for growth over the coming years. And although the a2 Milk share price is trading at 35x estimated FY 2021 earnings, I feel this is a fair multiple given its very positive long term outlook.
ResMed Inc (ASX: RMD)
Another top growth share which I think investors ought to consider buying is ResMed. It is a sleep treatment-focused medical device company which has a portfolio of leading masks and software solutions treating obstructive sleep apnoea.
ResMed has consistently delivered solid earnings growth over the last decade and I expect this positive trend to continue for the foreseeable future. This is thanks to the expected growth of the sleep treatment market, strong demand for ventilators, and its investment in research and development. And while the ResMed share price has just hit an all-time high, I would still be a buyer of its shares if you're planning to make a long term investment.
