2 high quality ASX shares for your retirement portfolio

Here's why Coles Group Ltd (ASX:COL) and this ASX share could be quality options for a retirement portfolio…

| More on:
Older couple enjoying the backyard

Image Source: Getty Images

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

One of the best ways to set yourself up for a comfortable retirement is by having a passive income stream that is both reliable and has the potential to grow over time. Investing in companies that share their profits through dividend payments is arguably the most efficient way of achieving this, particularly in the current low interest rate environment.

But which ASX shares could you buy for a retirement portfolio? Two highly rated ASX shares to consider are listed below:

Coles Group Ltd (ASX: COL)

The first option to consider for a retirement portfolio is this supermarket giant.

It has been a particularly strong performer over the last 12 months thanks to favourable tailwinds brought about by the COVID-19 pandemic.

And while its growth will inevitably moderate now as trading conditions return to relatively normal, the company remains well-positioned over the long term. This is due to its strong market position, focus on automation, and cost reductions.

Combined with its track record of delivering like for like sales growth, this should underpin solid earnings and dividend growth over the 2020s.

Goldman Sachs is positive on Coles and has a buy rating and $20.50 price target on its shares. The broker is also forecasting a fully franked dividend of 62 cents per share in FY 2021. Based on the current Coles share price of $16.40, this will mean a yield of 3.8%.

Goodman Group (ASX: GMG)

Another option to consider for a retirement portfolio is Goodman Group. It is an integrated commercial and industrial property group that owns, develops, and manages industrial real estate in 17 countries.

Goodman has been growing at a solid rate over the last decade thanks to the diversity of its operations and its exposure to quick growing markets such as ecommerce.

Pleasingly, the latter market has resulted in strong demand from blue chip customers such as Amazon, Coles, and Walmart. This appears to have positioned Goodman for sustainable growth over the 2020s.

One broker that is very positive on Goodman is Citi. It currently has a buy rating and $22.10 price target on its shares. It is also forecasting a distribution of 30 cents per share in FY 2021. Based on the current Goodman share price of $18.55, this represents a 1.6% yield. 

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of COLESGROUP DEF SET. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

More on Retirement

A happy elderly woman smiles and cheers as she looks at good investment news on her laptop.
Retirement

3 ASX dividend shares paying more than the pension in retirement

How much money would you need to have invested to receive more in ASX dividends than the pension?

Read more »

An older woman gazes over the top of her glasses with a quizzical expression as if she is considering some information.
Retirement

Government warning to retirees over Centrelink age pension misinformation

We reveal an example of what the Centrelink age pension misinformation circulating online looks like.

Read more »

A young couple in the back of a convertible car each raise a single arm in the air whilst enjoying a drive along the road.
Retirement

How to invest your first $10,000 in ASX shares towards an early retirement

Your first move could be an important one when it comes to building a retirement portfollio.

Read more »

Superannuation written on a jar with Australian dollar notes.
Superannuation

3 essential tips to maximise a superannuation fund at any age

Some simple changes can make a big difference...

Read more »

A couple sit on the deck of a yacht with a beautiful mountain and lake backdrop enjoying the fruits of their long-term ASX shares and dividend income.
Retirement

How to retire early using ASX shares

Want to retire early? Take a look at this guide.

Read more »

Smiling elderly couple looking at their superannuation account, symbolising retirement.
Retirement

If I were a retiree, I'd buy these 2 ASX shares straightaway

Retirees may do well with these investments in their portfolio.

Read more »

Couple holding a piggy bank, symbolising superannuation.
Retirement

The best ASX 200 retirement shares to buy in May

Bell Potter thinks these shares could be top options for retirees. Let's find out why.

Read more »

Retired couple hugging and laughing.
Retirement

2 wonderful ASX 200 retirement shares I'd buy in May

I’m very positive on these stocks for retirees.

Read more »