Some excellent ASX shares could be worth buying in July 2023, in my opinion.
Over the long-term, I think that the businesses that generate capital growth for investors will be the ones that make the biggest total returns thanks to the power of compound interest.
It’s impossible to say for sure that an investment will go up in value, but there are a few building blocks that could push companies higher. I’m going to talk about two of my favourite ASX shares.
VanEck Morningstar International Wide Moat ETF (ASX: GOAT)
This exchange-traded fund (ETF) is an exciting pick to me because of the investment style of how a portfolio of quality businesses are put together.
It’s a portfolio of companies from around the world that investment research house Morningstar believes have “sustainable competitive advantages”, or have wide economic moats. This means they have some sort of strength that makes it hard for competitors to overtake them.
Businesses like Boeing
and Microsoft have extremely strong market positions that could be almost impossible to displace.
The GOAT ETF only considers businesses that have some sort of advantage that is expected to last for at least a decade or two.
Businesses only enter the portfolio if those potential businesses are at a good price compared to how much the Morningstar team think the share price is worth.
Over the last ten years, the index that the GOAT ETF tracks has returned an average of 14.7% per year, though it’s hard to say what is going to happen next.
Temple & Webster Group Ltd (ASX: TPW)
This ASX share sells hundreds of thousands products through its website. There is a long-term trend of e-commerce adoption, particularly is more digital-savvy Aussies move into the higher-spending years of their lives (eg 30s and 40s).
I think this business is exposed to strong tailwinds which will help revenue and profit in the coming years.
Scaling up can help the business with operating leverage. It doesn’t cost much for a website to handle additional volume. A lot of the products sold are shipped by third party suppliers.
The business is utilising a number of different technologies to help boost its margins, including ChatGPT to power its product enquiry live chats, and an AI-based interior design service.
In the long-term, the ASX share thinks margins are going to improve, which I think will help the business become much more valuable in the future.
