I think there are some ASX 200 (ASX: XJO) shares that are growing and could keep doing well over the long-term.
They have already reached a certain large size, so they’re not going to quadruple in price any time soon, but they could continue to outperform the ASX 200 over the next decade.
Sonic Healthcare Ltd (ASX: SHL)
Sonic Healthcare is one of the biggest and best healthcare ASX 200 shares around.
If you’re wondering what it does, it’s involved in various pathology services.
I really like Sonic as a slow-and-steady defensive idea. The populations where it operates keep growing (and ageing) which is adding to Sonic’s potential customer base. It also continues to benefit from new technology so that it can offer patients better pathology and more accurate results.
Whilst the business had been growing at a decent rate before the coronavirus pandemic, profit has soared higher over the last year. Why? Because it’s one of the main businesses involved with COVID-19 testing.
In the HY21 result, Sonic saw revenue grow 33% and net profit went up 166%. All of the testing is using Sonic’s existing laboratories (it hasn’t had to invest heavily to do this), which is helping profit margins. It plans to use all of those earned cash to make strategic acquisitions.
I also think COVID-19 testing will go on longer than some investors are thinking, particularly if COVID variants continue to spread and change.
Wesfarmers Ltd (ASX: WES)
Wesfarmers is another ASX 200 share that is seeing enormous growth during this strange period of time.
Bunnings saw strong performance a year ago as people looked to buy items to complete projects at home.
Since the initial COVID-19 period, there has been strong demand for home building, renovations and so on, which is helping profit there.
Officeworks is another business that has seen enormous growth as people moved to working and learning at home.
Kmart, Catch and even Target have seen excellent demand as Australians spend their discretionary money at shops rather than on things like holidays.
Wesfarmers is not afraid to make moves to diversify its business into new industries. It tried to buy Lynas Rare Earths Ltd (ASX: LYC) and it ended up acquiring a stake in a lithium mining project.
It may not be the strongest performer over the next few years, but I think it can be a long-term performer thanks to its business diversification.
At the latest Wesfarmers share price, it’s priced at 26 times the estimated earnings for the 2022 financial year according to CommSec.
