The Best ASX Shares to Buy Now
in Australia in
July 2024

Check out our industry experts’ report and analysis on the
best Australian ASX shares to invest in right now!

The Best ASX Shares to Buy Now in Australia in July 2024

Check out our industry experts’ report and analysis on the best Australian ASX shares to invest in right now!

Why Invest in ASX Shares in 2024

Investing in ASX shares in 2024 might appear to be a good idea, compared to other stock markets and asset classes. Despite global uncertainty, the S&P/ASX 200 Index returned 8% across CY23, demonstrating the advantages of persistent investment in various market environments. Looking ahead to 2024, the possibility of interest rate decreases and the resulting impact on lower financing positions certain sectors, particularly information technology, for ongoing growth.

Although the battery metals sector saw a significant retreat due to falling prices, the long-term outlook appears just as strong as it did a year ago. And many health companies have upcoming catalysts for growth in the months and years ahead, both individual company catalysts, and trends in the population that work in their favour.

Investing in the Australian stock market in 2024 is about capitalising on the growth prospects of individual companies that are positioned to benefit from trends in their industry and the broader economy. ASX shares can be a good investment for investors, but it is important for investors to due their due diligence.

Current Market Trends in Australia

The Australian stock market is characterized by a blend of resilience and growth, with ASX growth stocks outperforming in sectors like technology and healthcare. In the past 12 months, the tech sector recorded an impressive 25% increase in market share, driven by online sales and digital transformation. Similarly, healthcare stocks have surged by 15%, buoyed by innovations and global demand for medical technologies. Mining and resources stocks have been more mixed, gold stocks performing but battery metal stocks underperforming - in both instances due to commodity pricing.

Amidst these gains, interest rates have been influencing investment and spending patterns in the economy. Some stocks have been unaffected, but others have been because of consumers cutting back their spending.

The Australian economy has demonstrated adaptability to global challenges, with GDP growth forecasted at 2.5% for the year ahead and a 'soft landing' appearing to be the reality - that is to say, the economy avoiding recession while adjusting to the new normal of rising interest rates. This economic backdrop supports a thriving share market, offering lucrative opportunities for investors in growth stocks and value stocks alike. Although interest rate cuts are coming, it is unclear whether investors are pricing in the reality that they may not happen until next year and may not be as substantial as interest rate cuts in overseas jurisdictions.

Dividend stocks continue to attract long-term investors with an average payout ratio of 65%, showcasing the market's potential for income generation alongside capital appreciation. Of course, this is skewed by the payouts of the big banks and miners, and even their payouts are ultimately up to the discretion of management.

Get the Latest Stock Market Insights for Free with
Stocks Down Under & Pitt Street Research

Join our newsletter and receive exclusive insights, market trends, investment tips, and updates delivered directly to your inbox. Don't miss out!

How to Identify the Best ASX Shares to Buy Now

To determine the best ASX shares to buy in the present Australian market, there are four factors that need to be considered. First, is the entry point. If you pay too much for a company (even if it is a good one) you blow up your returns. After all, your return is only judged by your entry and exit point. You want to 'buy low and sell high'. Unfortunately, there is no one metric or threshold to use to tell when a stock is overvalued, although investors can look at ratios such as P/E (in isolation and compared to its peers) or use technical tools like the RSI.

The second is the company's customers. Who are they? Do they actually exist? Do they need or vehemently want the company's product? Are they loyal to the company, would they remain so in the event of price rises or tough economic times and if so why? The best stocks have customers where you can easily answer yes to all of the aforementioned questions.

The third is the company's management. Do they make decisions in the long-term interests of the company? Do they have a proven track record, whether at the company or at another? Again, you need to be able to answer yes to all questions. It is also good if they have 'skin in the game' - that is to say equity ownership in the business because this aligns their interest with yours as an investor.

Fourth is the competition in the market. Is there competition or is the company in a monopoly situation? Preferably the latter, although it is a rare situation. And so how does the company stand out from its competitors? What is its competitive advantage? How is its product superior? What is the risk that the company could be overtaken by competitors.

Investors should also consider the economic climate and how it may impact their investment. But ideally, investors should own stocks that will be unaffected by economic conditions. Nonetheless, there's nothing wrong with owning a stock that will benefit from certain economic conditions, as long as these eventuate.

 

 

10 Best ASX Shares to Buy Now in 2024


ReadyTech (ASX:RDY)

ReadyTech (ASX: RDY) is in our view one of the best tech stocks on the ASX. It has a track record of growth, serves inflation-proof end markets and is set for good growth in the years ahead. ReadyTech provides SaaS technology in Australia and operates in three segments: Education, Workforce Solutions and Government and Justice.


Xero (ASX:XRO)

Xero (ASX:XRO) is one of the ASX’s best-performing tech stocks over the last decade, offering accounting software helping SMEs do business. Although the company was caught up in the Tech Wreck of 2022-23, shedding half of its value across that calendar year, it has bounced back with a vengeance in recent months, and we think there's more growth to come in FY25.



Infomedia (ASX:IFM)

Infomedia (ASX:IFM) is one tech stock that was unfairly sold off during the tech-wreck, but is gradually rebounding with a vengeance. The company has a long-term track record of growth, has remained profitable and is at the forefront of several trends in the automotive industry. IFM provides cloud-based parts and service software to the global automobile industry.


De Grey Mining (ASX:DEG)

Turning to the mining and resources sector, De Grey is one of our favourites. It is developing a gold project in WA with the aim of starting production in CY26. Its project, the Hemi project, has over 10Moz of gold and could well be a top 5 Australian gold mine. It would deliver $4.5bn in free cash flow after tax, a payback of less than 2 years despite a capital cost of nearly $1.3bn.


Breville (ASX: BRG)

Breville is a premium kitchen appliances business with a presence in Australia, Europe and the Americas. It was founded in 1932 – founded from capital obtained from a successful 4-to-1 bet at the 1932 Melbourne Cup. Breville sells nearly $1.5bn in goods each year in over 100 countries globally and caters to middle to higher income earners. It is headquartered in Sydney, has manufacturing facilities in China and regional offices in key markets.



Reliance Worldwide (ASX:RWC)

Reliance is a plumbing supplies company that is the largest manufacturer of PTC (Push to connect) behind the wall plumbing fittings. Reliance Worldwide’s flagship product is the Sharkbite range of brass push-to-connect fittings (as pictured below). These devices avoid the traditional soldering of parts into place, saving plumbers time.


CSL (ASX:CSL)

CSL (ASX:CSL) is the ASX's largest healthcare companies and one of the very few that is capitalised at over $100bn. It is best known for its flu vaccines and blood plasma businesses but has other products too and undertakes major R&D work. CSL was once a government entity, established in 1916. It was privatised in 1994 at $2.30 a share, although it undertook a three for one


Universal Store (ASX:UNI)

Universal Store is a chain of casual fashion stores aimed at Millennial and Gen Z customers (think 18-35 year olds). Universal Store has 79 stores across Australia, which tend to be in major shopping centres, as well as a further 20 or so stores exclusive for particular brands like Perfect Stranger, and the group makes 14% of its sales online.



Cyclopharm (ASX:CYC)

Cyclopharm (ASX:CYC) is a radiopharmaceutical company that is responsible for Technegas, a proprietary functional lung ventilation imaging agent. Essentially, a patient inhales Technegas before undertaking a Ventilation-Perfusion (VQ) scan and it makes the lungs easier to see. The company makes revenues through Technegas generators


Bellevue Gold (ASX:BGL)

The last stock on our list is Australia's newest gold producer. It bought its namesake project in WA in 2016 that had been an operating mine from 1897 to 1997, had produced nearly 1Moz (million ounces) of gold but had appeared to run out of life. The company began a drilling campaign in the last quarter of 2017 and has never looked back, delivering a return of over 5000% to investors.


10 Best ASX Shares to Buy Now in 2024

ReadyTech (ASX:RDY)

ReadyTech (ASX: RDY) is in our view one of the best tech stocks on the ASX. It has a track record of growth, serves inflation-proof end markets and is set for good growth in the years ahead.

ReadyTech provides SaaS technology in Australia and operates in three segments: Education, Workforce Solutions and Government and Justice. It offers various cloud-based solutions that help their clients with administration and management. ReadyTech was founded in 1998 and listed on the ASX in 2019 at $1.50 per share. Although it is off its all time highs, it is still well ahead of its IPO price.

Organisations in all three segments of ReadyTech’s business – Education, Workforce and Government – are experiencing a growing and ongoing migration to cloud and SaaS. This digital transformation across all industries is nothing new, but what is news that this transformation has been accelerating in the wake of COVID-19 shutdowns as demand soared for technology-driven initiatives to enable remote work, distance learning, new customer experiences and new online sales channels. We think the trend is still in early days and that ReadyTech is poised to derive a benefit.

In FY23, the 12 months to June 30 2023, ReadyTech recorded $130.3m in revenue, up 31.9% overall and 13.3% on a like for like basis (excluding the impact of M&A). EBITDA rose over 22% to $34.8m – representing a 35.6% margin – while NPAT rose 7% to $9.1m. The company boasted a highly sticky customer base that is willing to pay a premium for its services.

For FY24, ReadyTech has advised shareholders to expect organic revenue growth to be in the mid-teens and a 34-35% EBITDA margin. It is aiming to achieve over $160m in organic revenue in FY26 and says its high conviction pipeline of $28m gives it confidence that this can be achieved.

Xero (ASX:XRO)

Xero (ASX:XRO) is one of the ASX’s best-performing tech stocks over the last decade, offering accounting software helping SMEs do business. Although the company was caught up in the Tech Wreck of 2022-23, shedding half of its value across that calendar year, it has bounced back with a vengeance in recent months, and we think there's more growth to come in FY25.

Xero is all about helping small & medium sized businesses do business. The company, which has over 3 million subscribers, primarily sells accounting software that helps businesses keep books, pay bills and send invoices. But it has gradually developed features useful beyond book-keeping, such as storing files, converting currencies, keeping track of inventories and creating professional quotes.

Clearly, Xero is an essential service to its customers….it’s very hard to switch it off just to save a few bucks. And what incentive is there to switch to another solution like an MYOB? Very little. Whatever few bucks would be saved, would be lost in the long-run. Xero’s tools are estimated to save its customers on average 5.5 hours of manual work per week. We guess that is why its churn is less than 1%.

As if that wasn't good enough, the company continues to innovate over time, is growing faster outside Australia and New Zealand than outside, is expected to record its first profit in FY24 and still has some room for growth. The company believes the TAM (Total Addressable Market) is NZ$100bn and that is just the top 3 jobs its software is used for – Accounting, Payroll and Payments. Adjacent Tasks, including other tasks such as inventory, CRM and project management, could be another $39bn. The company has the explicit goal of doubling revenues by the end of FY27.

n FY24 – the 12 months to March 31, 2024 – the company recorded:

  • NZ$1.7bn in revenue (up 22%),
  • 4.16m subscribers (up 11% and 419,000 from 12 months prior),
  • $39.29 in average revenue per user (up 14%)
  • An 88% gross margin
  • A $174.6m profit (compared to a $113m loss in the year before).

Infomedia (ASX:IFM)


Infomedia (ASX:IFM) is one tech stock that was unfairly sold off during the tech-wreck, but is gradually rebounding with a vengeance. The company has a long-term track record of growth, has remained profitable and is at the forefront of several trends in the automotive industry.

IFM provides cloud-based parts and service software to the global automobile industry. It has over 250,000 active users in 186 countries and it has a healthy geographical mix of revenue (37% from the Americas, 32% from the Asia-Pacific and 31% from Europe). Infomedia can help its customers capture data, provide more personalised service to existing and would-be customers and monitor supply chains.

It has had some difficulties during the pandemic including the difficulty of business development during pandemic restrictions, the volatility in car sales and potential takeover bids falling through.

Turning to FY23, Infomedia’s total revenue was $129.9m (up 8%) and its NPAT was up 16% to $9.6m, even with an acquisition earnout expense. It paid a total dividend of 4cps, representing a 2.8% yield. Looking ahead to FY24, it is expecting revenue of $135-142m but has not given any other guidance besides that. Analysts covering the company expect $140.4m in revenue (up 8%), $59.4m in EBITDA (also up 8%) and 5c EPS, equating to a ~$18.8m profit (nearly double the year before).

We think the company can capitalise on several trends being adopted in the automotive industry including electric vehicles, the dealer agency business model and data-driven marketing.

De Grey Mining (ASX:DEG)

Turning to the mining and resources sector, De Grey is one of our favourites. It is developing a gold project in WA with the aim of starting production in CY26. Its project, the Hemi project, has over 10Moz of gold and could well be a top 5 Australian gold mine.

It would deliver $4.5bn in free cash flow after tax, a payback of less than 2 years despite a capital cost of nearly $1.3bn. And it is set to begin production in the second half of CY26. Chalice will have barely made an Final Investment Decision (FID) by then.

The DFS showed an NPV of $2.9bn post-tax, representing an IRR of 36% at an AISC of $1,295/oz over the first 10 years. The total evaluation period economic contribution is a staggering $10.8bn.

The company's share price has benefited from the rally in gold stocks, not to mention continued exploration work from the company showing there could be more upside. Full construction will start later this year.

Breville (ASX: BRG)

Breville is a premium kitchen appliances business with a presence in Australia, Europe and the Americas. It was founded in 1932 – founded from capital obtained from a successful 4-to-1 bet at the 1932 Melbourne Cup. 

Breville sells nearly $1.5bn in goods each year in over 100 countries globally and caters to middle to higher income earners. It is headquartered in Sydney, has manufacturing facilities in China and regional offices in key markets.

Breville listed in 1999 and has achieved growth of over 2000% since. In the last 10 years, it has gained 200%. In FY23, it generated $1.48bn in revenue (up 4%), $172m in EBIT (up 10%) and a $110.2m NPAT (up 4.2%). It recorded a 35% gross margin. The 4% revenue growth is hardly earth shattering, but follows 3 years of revenue growth of 19-25%. In 1HY24, it achieved $906m in revenue (up 2%), $131m in EBIT (up 8.2%) and a $84m NPAT (up 6.7%).

The company was impacted in the past two years due to fears that inflation would impact consumer demand and the company's costs, not to mention the company's inventory uplift. Neither of the former two came to pass, while the latter issue has been resolved.

We think there are four reasons why Breville can grow. First, it’s track record of sales growth with 14.6% CAGR in EBIT over the last seven years. While this isn’t a guarantee it can achieve the same results, it does inspire confidence. Second, the company’s experience in successfully entering new markets. The company estimates 70% of its revenue potential is unaddressed and it could ultimately achieve $9.7bn in revenue.

The third reason is the market the company is in. Breville offers premium and functional goods, targeted at consumers with higher disposable income. It is therefore less likely to be hit by a slowdown in consumer spending, at least to the extent of companies targeting lower incomes. Consumers feeling the pinch might view upfront investments in Breville’s products – coffee machines, ovens and juicers – as saving money in the long run. And consumers already with appliances and needing new ones won’t put off purchasing a new one for too long. Fourth, we observe that Breville has not had the same supply chain issues other companies have had. Unlike Kogan (ASX:KGN), Breville did not over-invest in new inventories predicting the boom would go on indefinitely.

Reliance Worldwide (ASX:RWC)

Reliance is a plumbing supplies company that is the largest manufacturer of PTC (Push to connect) behind the wall plumbing fittings. Reliance Worldwide’s flagship product is the Sharkbite range of brass push-to-connect fittings (as pictured below). These devices avoid the traditional soldering of parts into place, saving plumbers time.

It has proven resilient to inflation because of its ability to pass increases onto its customers. In FY23, Reliance Worldwide increased its net sales by 6% to $1.24bn. The Americas has been a strong contributor with sales growing 13% in that region, compared to a 4% decline in the Asia-Pacific and 3% growth in EMEA.  Although its NPAT came in at $155.7m (down 4%), its cash from operations more than doubled to $292.7m. It paid a dividend of 9.5 cents per share.

For 1HY24, its net sales were down 2% to $589m, although this was in line with guidance. Its NPAT was flat, at US$67.7m, but cash flow from operations was up 61% at US$151.6m. The company reduced its net debt by US$142m within 12 months.

In investors looking for a growth stock in the industrial sector that will be immune from the worst of inflation will find it tough to find a better company (at least in the industrials sector).

CSL (ASX:CSL)

CSL (ASX:CSL) is the ASX's largest healthcare companies and one of the very few that is capitalised at over $100bn. It is best known for its flu vaccines and blood plasma businesses but has other products too and undertakes major R&D work.

CSL was once a government entity, established in 1916. It was privatised in 1994 at $2.30 a share, although it undertook a three for one share split in 2007 making its IPO price 76.7c in real terms, meaning it has been more than a 300-bagger since listing!

The company's most recent gamble has been to pay US$11.7bn for Swiss company Vifor Pharma. CSL is evidently looking to profit from kidney disease, which affects 850m people globally – a figure expected to grow given the global obesity epidemic. It has faced challenges in justifying this price tag to investors, especially given the rise of Ozempic.

CSL has faced an uncertain outlook given the threat of Ozempic, falling margins and skepticism about Vifor. We, however, are confident in the company.

Even if Ozempic could indeed reduce obesity, and with it reduce people developing kidney disease in the future, it would not help people who already have the disease. The cooling of inflation should help its vaccines and blood plasma businesses. And we are also confident in the company's future products. The biggest catalyst in the latter regard is potential FDA approval of Hemgenix (the world’s first gene therapy for haemophilia B).

Universal Store (ASX:UNI)

Universal Store is a chain of casual fashion stores aimed at Millennial and Gen Z customers (think 18-35 year olds). Universal Store has 79 stores across Australia, which tend to be in major shopping centres, as well as a further 20 or so stores exclusive for particular brands like Perfect Stranger, and the group makes 14% of its sales online. Both curated third-party products and private brand products are sold in-house, although the former dominates.

It is a good business, but has been hit by perceptions that its customers will cut back their spending because they feel the brunt of the cost of living crisis. We think the recent Taylor Swift shows and the merchandise spent by them (estimated to be over $60m at the concerts alone) show that they will still spend when they perceive value.

In FY23, total Sales were up $263.1m, up 26.5% overall, although like for like sales were only up 1.2%. It made underlying EBIT of $40.4m, up 24%) and an NPAT of $23.6m, up 15%. Not bad in the rising interest rate environment. This was because the company was better able to manage inventory and offset costs of doing business. We are optimistic for further growth in the next 12 months as the Stage 3 Tax cuts come into effect. The revised package will put more money into the pockets of Universal Store's customer base.

Cyclopharm (ASX:CYC)

Cyclopharm (ASX:CYC) is a radiopharmaceutical company that is responsible for Technegas, a proprietary functional lung ventilation imaging agent.

Essentially, a patient inhales Technegas before undertaking a Ventilation-Perfusion (VQ) scan and it makes the lungs easier to see. The company makes revenues through Technegas generators, but also through consumables and after-sales services of the devices. Technegas is not only less damaging than alternative agents but is highly accurate, is quick and simple to administer and has minimal exclusion criteria (in other words, it can be administered to almost all patients including those with chronic lung obstruction disease).

Technegas is approved and/or sold in over 60 countries globally, a list that has only included the USA since October 2023. 2024 is set to be a key year for the company as it enters the world's largest healthcare market.

The company estimates that there is a market opportunity of US$90m or 600,000 procedures. Cyclopharm is targeting 80% of these, or 480,000 of these and believes it can achieve a 50% market share in 2-3 years and 90% in 5-7 years.

Cyclopharm is also seeking to expand the use of Technegas against other indications that could be larger markets - including COPD, asthma and Long COVID.

Bellevue Gold (ASX:BGL)

The last stock on our list is Australia's newest gold producer. It bought its namesake project in WA in 2016 that had been an operating mine from 1897 to 1997, had produced nearly 1Moz (million ounces) of gold but had appeared to run out of life.

The company began a drilling campaign in the last quarter of 2017 and has never looked back, delivering a return of over 5000% to investors.

It has Total Mineral Resources of 9.8Mt at 9.9 g/t for 3.1Moz of gold. 1.7Moz of this is Indicated with the balance inferred.  This makes it one of Australia’s highest-grade gold mines. The company forecasts a 10 year mine life and for $2.1bn of free cash flow, assuming a gold price of A$2,500/oz. This is the stuff dreams are made of.

BGL has issued guidance of 75,000-85,000oz production for the first six months of CY24, along with positive free cash flow, and confirmed earlier this week that it is on track to achieve this.

The Risks of Investing in ASX Stocks

Investing in the ASX stock market entails navigating a spectrum of risks, from market volatility to sector-specific challenges. In the past year, the ASX 200 experienced significant fluctuations, highlighting the importance of risk management.

Interest rate adjustments, can impact borrowing costs and economic growth, influencing stock prices and investor returns. Australia has 12 consecutive rate increases from 0.1% to 4.35% from May 2022 to November 2023. Although investors anticipate rate cuts and have sent stocks rallying, these may not be coming for some months - maybe even not until 2025.

Looking specifically at the tech sector, despite its high growth potential, carries risks of overvaluation, with average P/E ratios nearing 30. This necessitates a cautious approach, emphasizing the value of a diversified portfolio—spanning across value stocks, growth stocks, and dividend stocks—to mitigate exposure to market downturns.

Global economic uncertainties also pose significant risks, affecting commodity-dependent sectors such as mining, where commodity prices have seen a 10% variability in response to geopolitical tensions. Understanding these dynamics and incorporating a long-term perspective can help investors navigate the complexities of the ASX market, optimizing for both growth and stability in their investment decisions.

FAQs on Investing in Best Shares to Buy in Australia

The best shares to buy in Australia for 2024 include ReadyTech, Xero, Infomedia, De Grey Mining, Breville, Reliance Worldwide, CSL, and Universal Store. These stocks are recommended due to their strong performance, growth potential, and resilience in the current market conditions. Always research and consider your investment goals before investing.

Our Analysis on ASX Stocks

Nuix

Nuix (ASX:NXL) has quadrupled in 12 months! But is more growth to come?

July 15, 2024

Nuix (ASX:NXL) has been one of the most controversial companies on the ASX since it listed, but has it turned…

ASX Biotechs

Here are 3 ASX biotechs with major milestones coming right up!

July 15, 2024

Investing in ASX biotechs is a risky business, even more than most other companies on the market. Unless you own…

buy the dip

When do you know it’s time to ‘buy the dip’? You could be catching a falling knife

July 12, 2024

‘Buy the dip’ – have you ever heard that term? It implies that when a company’s share price ‘dips’ or decreases,…

What are bonds

What are bonds and are they preferable to investing in stocks?

July 12, 2024

We’re taking a look at what are bonds and what else investors should know about them. Even if investors prefer…

international student crackdown

The international student crackdown will get worse before it gets better and these 3 stocks could lose

July 11, 2024

Just when companies relying in international students as customers thought things were settling into a ‘new normal’, the international student…

How to Build a Stock Portfolio

How to Build a Stock Portfolio: Here are 5 essential steps

July 11, 2024

Here is Stocks Down Under’s 5-step guide on How to Build a Stock Portfolio!   1. Define Your Investment Goals…