Leading broker names 2 fantastic ASX growth shares to buy now

These growth shares could be star buys…
The post Leading broker names 2 fantastic ASX growth shares to buy now appeared first on The Motley Fool Australia. –

Investors searching for growth shares, may want to look at the shares named below.

These shares have been tipped to grow strongly over the 2020s and are currently named as buys by a leading broker.

Here’s what you need to know about them:

Hipages Group Holdings Ltd (ASX: HPG)

The first ASX growth 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. The Hipages platform not only helps tradies grow their businesses by providing job leads, but it also allows them to communicate with customers and run general admin duties.

Demand for the platform from both the tradie and consumer side has been strong, underpinning a solid full year result in FY 2021. Hipages reported a 22% jump in revenue to $55.8 million and a 27% increase in monthly recurring revenue (MRR) $5.2 million.

The team at Goldman Sachs are very positive on the company. The broker sees it as a great long term option due to its significant market opportunity. Its analysts estimate that Hipages currently captures around 5% of total industry advertising spend. However, it sees scope for this to increase to 40% to 60% in the future as the company builds out its ecosystem.

Goldman has a buy rating and $4.35 price target on the company’s shares.

Xero Limited (ASX: XRO)

Another ASX growth share that Goldman Sachs is a fan of is Xero. It is a cloud-based accounting solution provider to small and medium sized businesses.

As with Hipages, Xero was on form in FY 2021. It reported a 20% increase in subscribers to 2.74 million, a 38% jump in total subscriber lifetime value (LTV) to NZ$7.65 billion, and a 17% lift in annualised monthly recurring revenue (AMRR) to NZ$963.6 million.

The good news is that the company still has a significant market opportunity to grow into. Xero estimates that it has a total addressable market of 45 million subscribers globally, which means it has only captured a 6.1% share so far.

In addition, Goldman believes the company’s plan to monetise its growing user base via its app store could be a key driver of growth in the future.

Its analysts currently have a buy rating and $165.00 price target on its shares.

The post Leading broker names 2 fantastic ASX growth shares to buy now appeared first on The Motley Fool Australia.

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

Before you consider Xero, 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 Xero 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 August 16th 2021

More reading

Could the Xero (ASX:XRO) share price reach $165 by the end of 2021?

Why ASX 200 tech shares have outperformed today

Why is the Xero (ASX:XRO) share price leaping 5% today?

These ASX tech shares are lighting up the ASX 200 today

Why ASX 200 tech shares are struggling this week

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 Hipages Group Holdings Ltd. and Xero. The Motley Fool Australia owns shares of and has recommended Xero. The Motley Fool Australia has recommended Hipages Group Holdings Ltd. 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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