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Date : 28/07/2022

3 ASX Growth Stocks Investors Should Include In their Portfolio

After the pandemic began, economists hoped that economies would start to revive once things settled down. Things were going to move towards betterment when vaccines arrived, economies were opening, and economic activities restarted. However, everything was once again up in the air when Russia attacked Ukraine, and the world was thrown into another crisis.

This exasperated the already threatening inflation problem. In such an economic turmoil, some sectors showed a negative trend. When investors are unsure what to do, numbers play an essential role in identifying a growth stock in an uncertain situation like this. Even in harsh situations like this, investors should not hesitate to bet on the stock for the long run if a company shows good numbers.

Here are the top 3 growth stocks we have researched for you and would be a good catch in the future.

  1. Altium Limited (ASX: ALU)
  2. NextDC Ltd (ASX: NXT)
  3. TechnologyOne Ltd (ASX: TNE)

Altium Limited (ASX: ALU)

Altium Limited is the first growth stock on our list (ASX: ALU). It is engaged in providing PC-based electronic design software for engineers who design printed circuit boards (PCB).

PCBs are found in almost all electronic devices, so the company’s prospect seems bright. The company’s Altium Designer and Altium 365 software are getting popular, and these industry-leading software are used by top organisations such as NASA and Tesla.

Bell Potter has given the ALU shares a buy rating and is very optimistic about its growth. They have forecasted robust earnings growth in the upcoming years. They gave a price target of $34.00 to ALU shares.

The company’s first half saw an increase of 27% and 24% in revenue and NPAT, respectively. ALU shares are currently trading at $29.63 with a market cap of 3.9 Billion AUD.

Altium Limited ASX

NextDC Ltd (ASX: NXT)

The next stock on our list is NEXTDC Ltd (ASX: NXT), a leading Australian data centre operator. The company operates different data centres across Australia, having facilities in Melbourne, Sydney, Perth, Canberra, and Brisbane.

Data is the new oil, and tech companies now have tons of data that needs to be organised and managed. Here comes NEXTDC, which provides outsourcing solutions, connectivity services, and infrastructure management. So the company seems to have a great prospect in the future.

Financial analysts at Morgans are very optimistic about NXT and believe that the company has a solid position in the long run. During the past decade, the company has grown into a top-notch data centre network strengthening its position. They believe the company’s substantial structural growth, quality management, a significant barrier to entry, and most importantly, improving competitive advantage with regional/edge sites. They see robust growth, increased EBITDA, and solid free cash flows in the future.

They gave the NXT shares a buy rating with a price target of $13.01. NXT shares are currently trading at $11.60, gaining 19% in the past six months to reach a market cap of 5.03 Billion AUD.

NextDC Ltd

TechnologyOne Ltd (ASX: TNE)

The last stock on our list is TechnologyOne Ltd (ASX: TNE), an enterprise software providing company based in Australia.

Financial analysts at Goldman Sachs are giving it a buy rating due to its strong position in defensive end markets such as government, health and social services, and education. Not only that, the company has shifted to the SaaS model and expanded to the UK. Goldman Sachs believes that the company is in the right position to deliver robust earnings growth. They believe the company is becoming an excellent SaaS company with increasing revenue and net profit.

Along with the buy rating, they have given it a price target of $13.00. TNE shares are currently trading at $11.41, gaining 20% in the past year to reach a market cap of 3.69 Billion AUD.

TechnologyOne Ltd

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Top 5 ASX Stocks
to Buy for Capital Growth in 2022

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The hardest part to finding growth stocks is having an ability to understand the finer details of these companies from their valuations through to first mover advantage and having key factors on hand to make informed investment decisions.

Our experts take the guesswork out.

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