Curious to know which ASX shares some of Australia's top investors are backing? Read on to find out.
We can learn a lot about potentially exciting stocks by looking at larger holdings in the portfolios of 30 high-performing funds.
Of course, being chosen by the experts doesn't mean they're guaranteed to perform well. Having said that disclaimer, let's look at which stocks have been hand-picked.
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Aristocrat Leisure Limited (ASX: ALL)
This ASX stock is a global leader in poker machines and casino management systems. It also claims to be a leading global gaming content and technology company and a top-tier mobile games publisher.
According to reporting by the Australian Financial Review, Aristocrat was the only company outside of the most significant 20 businesses to be among the most widely-held stock pickers. This includes DNR Capital's High Conviction Strategy.
In terms of the outlook, it expects to deliver underlying net profit after tax (NPATA) growth in FY24 on a constant currency basis. The ASX share expects "strong segment profit growth" from its gaming division and a "market-leading margin result."
According to Commsec, the Aristocrat Leisure share price is valued at 19x FY24's estimated earnings and 17x FY25's estimated earnings.
Goodman Group (ASX: GMG)
Goodman is a huge property business and another ASX share widely held by fund managers. It is best known for owning and developing large industrial warehouses. Investors appear excited by Goodman's plans to benefit from increasing demand for AI as it increases its exposure to data centres.
As Totus Capital portfolio manager Ben McGarry recently said, according to the AFR:
Goodman is a world leader with Grade A industrial property in tier one cities in Australia, the US and Europe. The company has a large and growing data centre pipeline and, while not cheap versus other listed REITs, Goodman is very cheap relative to other listed data centre landlords.
Tribeca Alpha Plus fund manager Jun Bei Liu agreed that data centres were a positive for the ASX share's long-term growth potential. She said:
Goodman had decades of execution and a good track record, they were going to be able to re-innovate and grow their business.
ResMed CDI (ASX: RMD)
This ASX healthcare share offers digital health technologies and cloud-connected medical devices for people with sleep apnea, chronic obstructive pulmonary disease (COPD), and other chronic diseases.
ResMed is the fifth most-held stock out of the high-performing funds, even though it's number 16 in size on the index list.
A recent investor survey by JPMorgan found that ResMed was the stock in the ASX 20 that fund managers "most loved", according to the AFR.
The ASX share continues to report growth despite concerns about the possible impact of weight loss drugs on ResMed. In the second quarter of 2024, revenue rose 12% to US$1.2 billion, and the underlying gross margin increased 10 basis points to 56.9%. The underlying operating profit increased by 20%.
The company's operating cash flow was US$272.8 million, and fund managers seem optimistic about it.
