Insights

One ASX tech share to buy today ahead of government cash splash

ASX tech shares have outperformed this year. They could have further to run as the Government unveils its $800 million digital cash splash.
The post One ASX tech share to buy today ahead of government cash splash appeared first on Motley Fool Australia. –

Technology shares on the ASX, and across the globe, have widely outperformed the broader market returns this year. That’s led some analysts to speculate that tech shares have rallied too hard and too fast. And, indeed, over the past few weeks, many technology shares have given back some of their gains, though most of the big names are still well up for the year.

But with new funding pouring in from both the private and public sectors, the recent correction could be short-lived, and tech shares could again run much higher.

What new funding is the Government providing?

Today, Prime Minister Scott Morrison is unveiling the fine print on $800 million of new government spending intended to boost Australia’s technology sector and help lift the economy out of its COVID-19 recession.

Much of the money is earmarked for the Government’s own agencies. According to the Australian Financial Review, $257 million will be used to “improve access to government services by expanding the Digital Identity Program”.

Another $420 million will go towards combining the Australian Business Register and the 31 registers administered by ASIC, “allowing businesses to quickly view, update and maintain their business registry data in one location”.

That leaves some $120 million which “will be allocated across more than a dozen new initiatives designed to help business adapt to technology.”

Foolish takeaway

The rapid adoption of technology by businesses and households since social distancing and lockdowns became a reality just 6 months ago isn’t going to fade away. In fact, as the Government’s new $800 million tech spending program demonstrates, it’s only likely to keep speeding up.

This should benefit most of the well-run tech shares on the ASX.

One that I believe looks particularly well-placed to ride the tech boom, and grab a slice of the government’s latest cash splash (either directly or indirectly), is Appen Ltd (ASX: APX).

Appen develops human-annotated training data for machine learning and artificial intelligence. Though no information has been released, to my knowledge, its Speech and Data Collection business looks well-aligned to assist with the Government’s $257 million improvement package for the Digital Identity Program.

Appen’s share price is up 52% year-to-date.

Though gaining strongly today, Appen’s share price is still down 22% from its 26 August all-time highs, offering a potentially lucrative entry point.

Man who said buy Kogan shares at $3.63 says buy these 3 ASX stocks now

When investing expert Scott Phillips has a stock tip, it can pay to listen. After all, the flagship Motley Fool Share Advisor newsletter he has run for more than eight years has provided thousands of paying members with stock picks that have doubled, tripled or even more.*

In this FREE STOCK REPORT, Scott just revealed what he believes are the 3 ASX stocks for the post COVID world that investors should buy right now while they still can. These stocks are trading at dirt-cheap prices and Scott thinks these could really go gangbusters as we move into ‘the new normal’.

Find out the names of our 3 Post COVID Stocks – For FREE!

*Returns as of 6/8/2020

More reading

Motley Fool contributor Bernd Struben has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of Appen Ltd. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

The post One ASX tech share to buy today ahead of government cash splash appeared first on Motley Fool Australia.

Trade The World Anywhere & Anytime!

Mobile app platform with over 50,000 global listed securities across 12 markets (over 70% global market capitalisation), right from your Android or iOS device.

Integrated with exclusive trading idea and investment analysis tools to help you find actionable insight on virtually every financial instrument across our 12 global markets, to help you optimise your trading strategies.

Refer Your Friends

Tell your friends about Monex and gift them FREE access to our trading tools.

We respect your privacy and will only send this one email notification to your friends. 

Share With Your Friends

Share on facebook
Share on twitter
Share on linkedin

Monex Trading Tools Access and Usage Terms

The Monex Trading Tools (referred to as ‘tools’ hereafter) are available to you inside your client portal;


To activate access to the tools, you must have a verified and approved trading account and have made a deposit of at least AUD $1000.


An active and funded account with a positive trading balance is required to continue to have access to the tools;


Although the tools are available to you indefinitely, Monex Securities may at it’s discretion disable access to the tools in the future;


Monex securities reserves the right to change these terms and conditions from time to time, as it sees fit, without notice.

Important Notice
iOS & Android App - 12 International Markets & Over 70% Global Market Cap. $0 Brokerage On US Trades. Click Here!