There are some great ASX shares available for us to buy before the end of the year. These are two of the best options, in my opinion.
Brickworks Limited (ASX: BKW)
Brickworks has been a holding in my portfolio for a few years already and it looks like an excellent buy to me today.
The business has a few different segments, all of which are appealing.
First, I’ll mention its building products. It’s Australia’s biggest brickmaker, one of the country’s largest roofing businesses, it has a large stone and masonry business, it also offers specialised building systems, timber battens and cement. Brickworks is also a large US brickmaker. I think the weakness in construction activity has hurt the Brickworks share price, but this could be a good time in the cycle to invest.
Secondly, the ASX share owns approximately a quarter of investment house Washington H. Soul Pattinson and Co. Ltd (ASX: SOL), an impressive business itself with a diversified portfolio which is invested across a number of different ASX shares including Brickworks (they have a cross-holding partnership), New Hope Corporation Ltd (ASX: NHC), TPG Telecom Ltd (ASX: TPG), Nexgen Energy (Canada) CDI (ASX: NXG) and Macquarie Group Ltd (ASX: MQG). It also has a private equity portfolio and a credit portfolio. This WHSP investment is providing Brickworks with growing dividends and long-term capital growth.
The last segment is its impressive property portfolio, which includes a property trust which is a joint venture between Brickworks and Goodman Group (ASX: GMG). There is strong demand for industrial properties in Australia’s larger cities thanks to a growing level of online shopping, a bigger population and a rapid rise of demand for data centre space. This is helping Brickworks unlock the value of its excess land and create rental cash flow.
I think Brickworks is trading at attractive value right now following the ASX share’s 10% decline since September.
VanEck Morningstar Wide Moat ETF (ASX: MOAT)
This is one of the most appealing exchange-traded funds (ETFs), in my view. It aims to invest in the best US businesses, ones that have competitive advantages which allow them to make strong profits that are expected to endure for at least 20 years.
We don’t need to do the analysis ourselves to find those leading businesses, instead it’s the analyst team from Morningstar that does the research work. However, pleasingly, the annual management cost is quite low at 0.49%, which is about half of what many fund managers may charge.
Business competitive advantages can come in many forms, such as cost advantages, patents or having a superior brand that customers prefer. A few examples within the fund include Salesforce, Walt Disney, Adobe and The Campbell’s Company (soup).
We shouldn’t rely on past performance as a guide for future returns, but the MOAT ETF has returned an average of 14.4% per year in the last three years, beating the S&P 500’s average return of 14.1% per year.
Depending on how the US share market performs, this could be one of the leading funds for the next few years. It’s not exactly an ASX share, but it can be bought on the ASX.
