In this article, we will take a look at the 10 best ASX stocks to buy now. You can skip our comprehensive analysis of these Australian stocks and go directly to the 5 Best ASX Stocks to Buy Now.

The stock market in Australia is one of the most high performing and active ones in the world. It is estimated that close to 9 million adults in the country hold investments outside their primary dwelling and more than half of these investments are in direct shares. Building onto these solid foundations is the record influx of new investors in the market. Almost a quarter of all adults in Australia started investing in the last two years only. Women investors comprise more than 45% of these new investors and are trailblazing their way through the market highs and lows. 

The fresh perspectives that these new investors bring to the fore have shaped market dynamics in Australia much like the rest of the world. However, due to the nature of the Australian economy, where a handful of sectors like energy and finance dominate the market, the traditional power players seem to have weathered this storm. However, the losses incurred as a result of the COVID-19 pandemic and under the calls for increased urgency in relation to climate change action by global actors, an introspection has led to more focus on diversification. 

One of the top picks in the Australian market, Oil Search Limited (ASX: OSH.AX), has been conducting air quality checks around its exploration facilities to maintain pollution levels to a minimum under government regulations. Oil Search Limited (ASX: OSH.AX) has also put in place a plan to more effectively manage waste, effluents, and spills on these sites. However, big oil companies in Australia have also recently admitted that they are facing issues in getting financing for new projects as climate concerns grow. 

The retail sector has been adapting to market changes better than expected. Wesfarmers Limited (ASX: WES.AX), one of the largest retail firms on the Australian market, recorded more than $20 billion in revenue last year despite the hit in sales due to the pandemic. Wesfarmers Limited (ASX: WES.AX) is also planning to make Kmart, one of three big retail chains it owns and runs, one of the key focus areas for the firm on the back of stellar sales numbers and plans for technology-enabled growth and scaling solutions. 

Some dual-listed stocks, that trade both in Australia and the United States, are also worth a mention in the top ASX stocks. Rio Tinto Group (NYSE: RIO) and BHP Group (NYSE: BHP) are among these options. Rio Tinto Group (NYSE: RIO)  and BHP Group (NYSE: BHP)  both engage in the mining of natural resources. The companies were hit by the lockdowns imposed to contain the COVID-19 pandemic but are now on the rebound trail as the economy slowly reopens and allows for the resumption of business activities.

Things are a little more topsy and turvy for the finance companies in Australia. Westpac Banking Corporation (ASX: WBK) was forced to cancel dividend payments last year as the COVID-19 crisis took a toll on the company. However, with the financial outlook improving in recent weeks, Westpac Banking Corporation (ASX: WBK) announced a semi-annual dividend of AUD 0.58 per share on May 11 that will be payable to shareholders next month. Despite the upside potential, the growth of fintech and crypto still clouds long-term positions on finance. 

Before investing, you should practice caution and do a lot of research, as financial volatility is making things difficult even for the smart investors. The entire hedge fund industry is feeling the reverberations of the changing financial landscape. Its reputation has been tarnished in the last decade, during which its hedged returns couldn’t keep up with the unhedged returns of the market indices. On the other hand, Insider Monkey’s research was able to identify in advance a select group of hedge fund holdings that outperformed the S&P 500 ETFs by more than 124 percentage points since March 2017. Between March 2017 and February 26th 2021 our monthly newsletter’s stock picks returned 197.2%, vs. 72.4% for the SPY. Our stock picks outperformed the market by more than 124 percentage points (see the details here). We were also able to identify in advance a select group of hedge fund holdings that significantly underperformed the market. We have been tracking and sharing the list of these stocks since February 2017 and they lost 13% through November 16th. That’s why we believe hedge fund sentiment is an extremely useful indicator that investors should pay attention to. You can subscribe to our free newsletter on our homepage to receive our stories in your inbox.

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With this context in mind, here is our list of the 10 best ASX stocks to buy now.

Best ASX Stocks to Buy

10. Woolworths Group Limited (ASX: WOW.AX)    

Woolworths Group Limited (ASX: WOW.AX) is a Bella Vista-based retail company. It is placed tenth on our list of 10 best ASX stocks to buy now. It was founded in 1924. The firm runs more than 1,000 supermarkets and food stores across Australia. It has operations in New Zealand as well. The firm also markets branded beverages and runs more than 334 hotels. Woolworths stock has returned more than 16% to investors over the past year. The hotel division of the firm offers leisure and hospitality services, as well as entertainment and gaming.

Woolworths Group Limited (ASX: WOW.AX) is one of the top stocks in the Australian market, mostly due to the core retail business. A bigger name in the retail sector globally is Walmart Inc. (NYSE: WMT), the US-based giant of the industry. 

At the end of the fourth quarter of 2020, 70 hedge funds in the database of Insider Monkey held stakes worth $6.1 billion in Walmart Inc. (NYSE: WMT), up from 69 the preceding quarter worth $5.4 billion.

9. Sonic Healthcare Limited (ASX: SHL.AX)   

Sonic Healthcare Limited (ASX: SHL.AX) is a Sydney-based medical firm founded in 1934. It is placed ninth on our list of 10 best ASX stocks to buy now. Sonic stock has returned more than 27% to investors in the past year. The firm markets laboratory, pathology, and radiology services. It runs more than 200 primary care clinics and has operations in the US and Germany in addition to Australia. It has a market cap of more than $13 billion and posted more than $4.7 billion in annual revenue in the past fiscal year. 

Sonic Healthcare Limited (ASX: SHL.AX) has managed to sustain itself through the pandemic crisis and all the signs bode for its future. AbbVie Inc. (NYSE: ABBV), an American pharma firm, has done remarkably well through the economic crisis too. 

Out of the hedge funds being tracked by Insider Monkey, Nebraska-based investment firm Berkshire Hathaway is a leading shareholder in AbbVie Inc. (NYSE: ABBV) with 25 million shares worth more than $2.7 billion.

8. Woodside Petroleum Ltd (ASX: WPL.AX)     

Woodside Petroleum Ltd (ASX: WPL.AX) is a Perth-based oil company founded in 1954. It is ranked eighth on our list of 10 best ASX stocks to buy now. The firm markets liquefied natural gas, pipeline natural gas, condensate, liquefied petroleum gas, and crude oil. It has stakes in several notable oil exploration and production projects, including the Greater Browse, Greater Sunrise, Greater Pluto, Greater Exmouth, North West Shelf, Wheatstone, Canada, Senegal, Greater Scarborough, and Myanmar project, among others. 

Like Rio Tinto Group (NYSE: RIO) and BHP Group (NYSE: BHP), Woodside is one of the best Australian companies.

The profits of Woodside Petroleum Ltd (ASX: WPL.AX) have taken a hit in recent months as oil prices plunged due to the virus crisis as well as a production war. Exxon Mobil Corporation (NYSE: XOM), a US-based oil firm, has undergone a lean spell as well. 

At the end of the fourth quarter of 2020, 63 hedge funds in the database of Insider Monkey held stakes worth $2.2 billion in Exxon Mobil Corporation (NYSE: XOM), up from 52 in the preceding quarter worth $1.3 billion.

7. APA Group (ASX: APA.AX)

APA Group (ASX: APA.AX) is a New South Wales-based firm that owns natural gas and electricity generation assets. It is placed seventh on our list of 10 best ASX stocks to buy now. The firm also owns and operates solar and wind farms. It has a market cap of close to $9 billion and pays a healthy dividend regularly. The firm has stakes in almost 15,000 kilometers of gas transmission pipelines, almost 29,500 kilometers of gas mains and pipelines, as well as 1.4 million gas consumer connections. Like Rio Tinto Group (NYSE: RIO) and BHP Group (NYSE: BHP), APA is one of the best Australian companies.

A top play in the energy sector along the lines of APA Group (ASX: APA.AX) would be Plains All American Pipeline, L.P. (NASDAQ: PAA), a Texas-based energy transportation company primarily operating in the US and Canada. 

Out of the hedge funds being tracked by Insider Monkey, investment firm Arrowstreet Capital is a leading shareholder in Plains All American Pipeline, L.P. (NASDAQ: PAA) with 5.1 million shares worth more than $42 million. 

6. Telstra Corporation Limited (ASX: TLS.AX) 

Telstra Corporation Limited (ASX: TLS.AX) is a Melbourne-based telecommunications firm. It was founded in 1975 and is ranked sixth on our list of 10 best ASX stocks to buy now. It is one of the largest firms in Australia and markets voice, mobile, internet access, pay television and other products in addition to the telecom services. Telstra stock has returned close to 12% to investors over the past twelve months. The company has been expanding reach into the tech sector in recent years with forays into the cloud storage business. Like Rio Tinto Group (NYSE: RIO) and BHP Group (NYSE: BHP), Telstra is one of the best Australian companies.

Telstra Corporation Limited (ASX: TLS.AX) is a telecom giant in Australia, just like Verizon Communications Inc. (NYSE: VZ) in the US. Income investors should definitely consider investing in them as they pay regular dividends. 

At the end of the fourth quarter of 2020, 67 hedge funds in the database of Insider Monkey held stakes worth $10.5 billion in Verizon Communications Inc. (NYSE: VZ), up from 65 in the previous quarter worth $2.7 billion.

Click to continue reading and see 5 Best ASX Stocks to Buy Now.

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Disclosure: None. 10 Best ASX Stocks to Buy Now is originally published on Insider Monkey.

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