2 excellent ASX tech shares named as buys

These tech shares could be going places…
The post 2 excellent ASX tech shares named as buys appeared first on The Motley Fool Australia. –

There are a number of companies in the tech sector that are expected to grow at a strong rate in the future.

Two that you might want to get better acquainted with are listed below. Here’s what you need to know about them:

Altium Limited (ASX: ALU)

The first ASX tech share to look at is this printed circuit board (PCB) focused electronic design software provider. Although COVID-19 has been weighing on Altium’s performance and could lead to it falling short of guidance in FY 2021, management remains as positive as ever on the future.

This due to its industry-leading platform and a number of tailwinds which are underpinning increasing demand for electronic design software.

These include the rapidly growing artificial intelligence and internet of things markets, which are leading to a proliferation of electronic devices globally. All in all, management is aiming to more than double its revenue to US$500 million in the next five years and appears confident it will get there.

Credit Suisse is bullish on Altium. It recently put an outperform rating and $42.00 price target on its shares.

Hipages Group Holdings Ltd (ASX: HPG)

Another ASX tech share to look at is Hipages. It is a leading Australian-based online platform and software as a service (SaaS) provider that connects tradies with residential and commercial consumers. It has been growing at a strong rate in FY 2021 and looks well-placed to continue this positive form long into the future. This is thanks to the increasing popularity of its platform and its large market opportunity.

Analysts at Goldman Sachs are very positive on its prospects and currently have a buy rating and $3.40 price target on its shares. The broker notes that the company has a clear strategy to further evolve its ecosystem to increase the value it can provide to a tradie. It expects this to help the company grow its market share and total addressable market (TAM).

It explained: “In our view the road-map to build out the ecosystem provides a notable adjacency for HPG to grow its market share and TAM and provides a strong long-term growth driver. For context, HPG captures c.5% of total industry advertising spend. We see scope for this to grow at a meaningful rate as HPG’s service offering addresses a greater proportion of a tradie’s needs, noting that REA/CAR now capture c.40-60% of spending in their respective categories.”

The post 2 excellent ASX tech shares named as buys appeared first on The Motley Fool Australia.

Should you invest $1,000 in Altium right now?

Before you consider Altium, you’ll want to hear this.

Motley Fool Investing expert Scott Phillips just revealed what he believes are the 5 best stocks for investors to buy right now… and Altium wasn’t one of them.

The online investing service he’s run for nearly a decade, Motley Fool Share Advisor, has provided thousands of paying members with stock picks that have doubled, tripled or even more.* And right now, Scott thinks there are 5 stocks that are better buys.

*Returns as of May 24th 2021

More reading

3 stellar ASX growth shares that are highly rated

Here are the 5 worst performing ASX 200 tech shares from FY21

3 stellar ASX growth shares analysts love

Why the Altium (ASX:ALU) share price rocketed 30% higher in June
These were the best performing ASX 200 shares in June

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and has recommended Altium and Hipages Group Holdings Ltd. The Motley Fool Australia owns shares of and has recommended Altium. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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