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2 strong ASX shares to buy and hold for a decade

I think that the best way to invest in ASX shares is to buy and hold for the long-term. Owning the below investments for the next decade could prove to be fruitful.

I’m looking for leading businesses that want to keep growing strongly for a long time. The power of compounding could make these ASX shares much bigger in the next decade:

EML Payments Ltd (ASX: EML)

EML Payments is one of the leading ASX companies in the payments space. EML works with companies around the world in a variety of different industries, providing tailored payment solutions to suit their needs. Some use cases include buy now, pay later, insurance claims, compensation payouts, corporate expense cards, salary packaging and payroll.

The EML share price has fallen by around 10% in 2022 and almost 50% over the past 11 months.

However, I don’t think that the ongoing pessimism is justified. The Central Bank of Ireland (CBI) outcome seems much more positive than what the market was worried about.

The ASX share continues to grow at a fast pace. EML’s HY22 revenue rose 20% to $114.4 million and underlying net profit (NPATA) increased 6% to $13.1 million. If it can keep growing revenue at double digits for the long-term, I expect the company to benefit nicely from operating leverage due to the increased scale.

Another growth avenue for EML is the recent partnership with Up Spain, allowing it to enter the European employee benefits market. It could grow into other countries if it can work with the rest of Up Group.

Using CommSec estimates, the EML Payments share price is valued at 19 times the estimated earnings for the 2024 financial year.

Temple & Webster Group Ltd (ASX: TPW)

Temple & Webster is one of the leading e-commerce ASX shares.

It sells a huge variety of homewares, furniture and various other categories. The company’s core offering continues to see growth. In the first half of FY22, revenue grew by 46% to $235.4 million.

One of the growth avenues for the company is the ‘next growth horizons’.

Home improvement revenue went up 95%, representing 4% of the total revenue. Home improvement adds another $16 billion to its addressable market, representing products like tool and equipment, garden and landscaping, painting and supplies, window furnishings, flooring, plumbing fixtures and so on. Less than 5% of this category has moved online.

The ASX share says it’s leveraging its leadership position to realise scale advantages.

Temple & Webster aims to provide a strong consumer proposition, re-invest for growth, achieve better unit economics and generate first-time and repeat orders.

Over the long-term, Temple & Webster is expecting more furniture and homewares shopping to be done online. For example, in the US, the online penetration was 25.3% in 2020, while it was only between 7% to 9% in Australia.

It wants to be the market leader in Australia, online and offline. With the level of re-investment it’s doing, I think it can achieve this goal, though I’m sure there will be some bumps along the way.

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At the time of publishing, Jaz does not have a financial or commercial interest in any of the companies mentioned.