These ASX shares have long runways for growth…
The post Why analysts love Zip (ASX:Z1P) and these fantastic ASX growth shares appeared first on The Motley Fool Australia. –
Looking for growth shares to buy? Then you might want to consider the three listed below.
Here’s why they have been tipped as growth shares to buy:
NEXTDC Ltd (ASX: NXT)
The first ASX growth share to look at is NEXTDC. It is a leading data centre operator benefiting greatly from the structural shift to the cloud. This shift has led to growing demand for data centre capacity over the last few years, which has resulted in strong revenue and operating earnings growth.
Positively, this shift still has a long way to go, which should be supportive of further strong growth over the remainder of the 2020s. This could be boosted further by its plans to expand into the Asian market in the near future.
Morgan Stanley is positive on the company. It currently has an overweight rating and $14.60 price target on its shares.
PointsBet Holdings Ltd (ASX: PBH)
Another ASX growth share to look at is PointsBet. It is a leading sports betting company with operations in both the ANZ and US market. From these markets, the company is currently generating significant revenue. This is being driven by the growing popularity of mobile sports betting and innovative products like same game multis.
The good news is that the company is only scratching at the surface of its massive US market opportunity. For example, Goldman Sachs notes that the US sports betting market is forecast to grow at a compound annual growth rate of 40% out to 2033. It estimates that it will be worth US$39 billion a year at that point.
In light of this and its strong market position, the broker currently has a buy rating and $17.20 price target on its shares.
Zip Co Ltd (ASX: Z1P)
A final ASX growth share to look at is Zip. As with the others, this buy now pay later (BNPL) provider has been growing at a strong rate in recent years. This is being driven by its international expansion and the increasing popularity of the payment method with consumers and merchants.
And while its sales have been growing materially again in FY 2021, they are still only a tiny fraction of a $5 trillion market opportunity in just the United States. Add in the European and Asian markets, and Zip clearly has an extremely long runway for growth over the next decade.
Last week Citi put a buy rating and $10.90 price target on the company’s shares.
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James Mickleboro owns NextDC shares. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and has recommended Pointsbet Holdings Ltd and ZIPCOLTD FPO. The Motley Fool Australia has recommended Pointsbet Holdings Ltd. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.