2 top ASX shares to buy and hold for the next decade

I love the power of the ASX share market. It can help us grow $100 into multiple hundreds of dollars over the long term. I think the best way to do that is by investing in businesses that could grow significantly in the years ahead.

Companies that can significantly compound their earnings can generate large shareholder returns. Many investors value ASX shares on how much profit they generate today and what earnings are expected to be in the future, so profit growth is a big tailwind.

So, I'm going to highlight two ASX shares that could be significantly larger in 10 years.

L1 Group Ltd (ASX: L1G)

L1 Group is a fund manager that offers a number of investment strategies including ASX shares, international shares, gold, and UK property.

The fund manager recently reported its quarterly funds under management (FUM) update for September 2026, which showed FUM was up 1.3% for the quarter. The long short strategies – its biggest division by far – saw FUM growth of 5% quarter over quarter to $9.3 billion.  

A key reason for my optimism about its performance for the next decade is that its main strategies have performed for a long time, not just one good year. The mentality of not going with the crowd, avoiding hyped-up stocks, and sticking with companies that have lower price-earnings (P/E) ratios has worked well.

The L1 Capital Long Short Fund – monthly class started in September 2014. 12 years later, it has returned an average of 20.1% per year. I'm not expecting that level of investment return going forward, but it has been strong organic growth for L1 Group's FUM and could continue to be.

There are a number of drivers for its FUM and earnings.

It has announced multiple new fund strategies, including PXC Advisors, East Rocky Asset Management, and an Australian small-caps strategy.

It has raised $2.4 billion through L1-managed listed investment companies (LICs), with one raising ongoing.

Also, the integration of Platinum is ahead of expectations, with two upgrades of cost synergies – the current target is $43 million.

Through a combination of good investment returns and ongoing net inflows, I believe this ASX share has a very exciting future.

Temple & Webster Group Ltd (ASX: TPW)

Temple & Webster is an online retailer of hundreds of thousands of homewares and furniture products through its website.

Australians are buying a much bigger percentage of their items online than they did a decade ago, and I believe there will be another large increase in online adoption in ten years from now as younger Australians (who are more digitally savvy) reach their prime spending years.

Online penetration in Australia is currently 20%, while it's 29% in the UK and 35% in the US. There's significant room for growth over the next several years, as Australia has typically lagged global markets by five to seven years.

The Temple & Webster share price has fallen significantly over the past year, so the company has made a number of actions to turn things around, including focusing on the mass mid-market customer and reducing its entry-level ranges over time where most of the profit in the industry is, while also being more disciplined with discounts.

It wants to return to double-digit revenue growth in FY28, while maintaining its improved unit economics. In the short term, after a 7% revenue lift in Brisbane, it's planning to roll out a marketing campaign nationally.

Temple & Webster is working hard on its AI retail strategy to ensure that it's a winner from industry changes, and the shift could help it compete even stronger against traditional retail.

The ASX share also has a growing private label, which is seeing rising revenue and margins. It wants the private label to be more than 35% of revenue in the long term.

I also think there is a lot of growth potential for the company with home improvement products and selling products to New Zealand customers, which could become notable contributors in the coming years.

The post 2 top ASX shares to buy and hold for the next decade appeared first on The Motley Fool Australia.

Motley Fool contributor Tristan Harrison has positions in L1 Group and Temple & Webster Group. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has positions in and has recommended Temple & Webster Group. The Motley Fool Australia has recommended Temple & Webster Group. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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