Looking for some high-growth names? These five shares have delivered rapid revenue growth.
The post These 5 ASX shares grew revenue by more than 70% in the last year appeared first on The Motley Fool Australia. –
There are many investment opportunities in the Australian share market. Though, not many ASX shares with a meaningful market capitalisation can say their revenue grew by more than 70% compared to the previous year.
Usually, achieving low double-digit percentages of revenue growth is impressive. However, a number of companies have enjoyed substantially greater increases in revenue from FY20 to FY21. While this isn’t necessarily an all-encompassing barometer to measure the quality of a company, it does give some colour to a company’s ability to expand.
Another important consideration is the company’s earnings growth. If revenue growth is primarily driven by high expenditure on customer acquisition, there is always the risk that earnings could dry up once the marketing tap is turned off — that’s an article for another day.
Without further ado, let’s look at five ASX shares that grew like crazy in the past year.
ASX shares with fast-growing revenue
Fortescue Metals Group Limited (ASX: FMG)
The iron ore mining giant has taken a tumble since posting its FY21 results back in August. However, that doesn’t take away from the fact that Fortescue Metals grew its revenue by 73.8% from the previous corresponding period. A dramatic surge in iron ore prices helped the company achieve a substantially greater revenue of US$22.284 billion over the year.
This ASX share is currently valued at a price-to-earnings (P/E) ratio of 5.9 times. Despite the revenue growth, the Fortescue Metals share price is down 20% year to date (YTD).
Afterpay Ltd (ASX: APT)
We have all come to know the buy now, pay later (BNPL) payment option and some of the high flying companies in the sector. Sitting atop the industry in Australia is the now synonymous Afterpay, as it looks to be acquired by Block Inc (NYSE: SQ) (formerly Square). Afterpay managed to grow its top-line figure by 75.4% to $836.05 million in FY21.
Due to its current unprofitability, Afterpay does not have a positive P/E ratio. It has been a disappointing year for the Afterpay share price, with shares down 26% YTD.
Mineral Resources Limited (ASX: MIN)
Like Fortescue, this ASX mining share benefitted from an increase in commodity prices in FY21. Mineral Resources revenue increased 75.7% compared to the previous corresponding period to $3.734 billion. Unlike Fortescue, this company’s increased revenue was partly due to the surge in demand for lithium.
The bumper year also delivered record profits for Mineral Resources. As a result, the company currently trades on a P/E ratio of ~7.7 times. Additionally, it appears the miner’s exposure to lithium has insulated it from the weakening iron ore price — shares in the company are up 35% YTD.
Temple & Webster Group Ltd (ASX: TPW)
Switching gears from miners to online homewares and furniture retailing, this ASX share took full advantage of a shift in shopping behaviours as a result of COVID-19. In turn, Temple and Webster’s revenue soared 85% to $326.34 million in FY21.
The company is currently trading on a P/E ratio of 89 times. However, investors have been putting selling pressure on the e-commerce business since August. Consequently, the Temple and Webster share price is down 12% YTD.
Pointsbet Holdings Ltd (ASX: PBH)
We’ve left the ASX share with the highest year-on-year revenue growth for last. Pointsbet is a sports betting company offering a wagering platform with a range of unique betting options. In FY21, the company put its foot on the gas in terms of revenue growth — growing a remarkable 158.9% to $194.66 million.
Despite being the fastest-growing on the top line, the Pointsbet share price has been the worst performing of those on this list this year. Shares have fallen 39% since the beginning of 2021.
The post These 5 ASX shares grew revenue by more than 70% in the last year appeared first on The Motley Fool Australia.
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Motley Fool contributor Mitchell Lawler owns AFTERPAY T FPO. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns and has recommended AFTERPAY T FPO, Block, Inc., Pointsbet Holdings Ltd, and Temple & Webster Group Ltd. The Motley Fool Australia owns and has recommended AFTERPAY T FPO. The Motley Fool Australia has recommended Pointsbet Holdings Ltd and Temple & Webster Group Ltd. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.