Not sure about small caps? Take a look at these mid caps instead…
The post 2 highly rated mid cap ASX shares tipped as buys appeared first on The Motley Fool Australia. –
If small caps are too high on the risk scale for your investment tastes, then you might be better off looking at the mid cap space.
These companies are lower down the risk scale but still have the potential to generate outsized returns for investors in the future.
With that in mind, I have picked out two mid cap ASX shares that are highly rated right now. Here’s what you need to know about them:
Bravura Solutions Ltd (ASX: BVS)
The first mid cap ASX share to look at is Bravura Solutions. It is a leading provider of software solutions for the wealth management and funds administration industries.
Bravura owns a portfolio of solutions that are both high quality and have significant market opportunities. Chief among them is the key Sonata wealth management platform, which allows financial advisers to connect and engage with clients via computers or smart devices.
But it doesn’t stop there. Bravura has been on an acquisition spree over the last few years, strengthening its offering. As a result, it also has the FinoCamp, Midwinter, and Delta Financial Systems solutions. FinoCamp builds unique and highly flexible software that supports the UK wealth market, Midwinter is a financial planning software provider, and Delta Financial Systems provides technology to power complex pensions administration in the UK market.
Times have been hard over the last couple of years because of Brexit and COVID-19. However, it appears as though the company has finally moved on and is ready to resume its growth again.
It is for this reason that Goldman Sachs is a fan of the company. It currently has a buy rating and $3.90 price target on its shares. Goldman believes Bravura has a massive growth opportunity in the UK and ANZ markets.
Another mid cap ASX share to look at is Nearmap. It is an aerial imagery technology and location data company.
Thanks to its technology, every day the company helps thousands of users conduct virtual site visits for deep, data-driven insights. It notes that this enables informed decisions, streamlined operations, and significant cost savings.
Demand for its offering has been growing strongly in the ANZ and North American markets over the last few years and has continued in FY 2021. Earlier this week, Nearmap released its full year update and revealed a record performance in the United States. This led to Nearmap outperforming its guidance in FY 2021.
It expects to report a 26% increase in annual contract value (ACV) to $133.8 million on a constant currency basis. This compares to its previously upgraded ACV guidance of $128 million to $132 million.
Looking ahead, management appears confident in its growth trajectory. It continues to target annualised contract value (ACV) growth of 20% to 40% per annum over the long term, with underlying churn of less than 10%.
Morgan Stanley remains bullish. This week the broker retained its overweight rating and $3.20 price target on its shares.
Should you invest $1,000 in Nearmap right now?
Before you consider Nearmap, 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 Nearmap 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
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 Bravura Solutions Ltd and Nearmap Ltd. The Motley Fool Australia owns shares of and has recommended Bravura Solutions Ltd and Nearmap Ltd. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.