The tech sector has underperformed recently because of a rotation out of growth and into value stocks.
But as far as some experts are concerned, this rotation has only dragged the shares of some quality companies down to more attractive levels. Which could make now an opportune time to invest in the tech sector with a long term view.
Three ASX tech shares which are highly rated are listed below:
Altium Limited (ASX: ALU)
Altium is an award-winning printed circuit board (PCB) design software provider. Over the last decade it has carved out a leading position in this growing market. Which is a big positive given the proliferation of electronic devices. This is likely to lead to increasing demand for its software over the next decade. Analysts at Credit Suisse are positive on its prospects. They have an outperform rating and $42.00 price target on its shares.
Audinate Group Limited (ASX: AD8)
At the smaller end of the market is Audinate. It is a digital audio-visual networking technologies provider which has been delivering impressive sales growth over the last few years. This is thanks to its Dante product, which is the clear market leader. And while FY 2020 was a tough year because of the pandemic, the company looks well-placed to bounce back strongly when the pandemic passes. UBS has been pleased with its recovery and particularly its strong performance in the first quarter. It put a buy rating and $8.00 price target on its shares.
Xero Limited (ASX: XRO)
Xero is a leading cloud-based business and accounting software provider. Thanks to its evolution into a full service small business solution over the last few years, the company has been growing its customer numbers and recurring revenues at a rapid rate. The good news is that due to the quality of its offering, the shift to the cloud, its global market opportunity, and burgeoning app ecosystem, Xero has been tipped for more of the same in the future. Goldman Sachs is very positive on its prospects and recently put a buy rating and $157.00 price target on its shares.
Where to invest $1,000 right now
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Scott just revealed what he believes are the five best ASX stocks for investors to buy right now. These stocks are trading at dirt-cheap prices and Scott thinks they are great buys right now.
*Returns as of June 30th
More reading
- Why the ASX tech share rally can run well into 2021
- 3 quality SaaS ASX shares to buy
- 3 reasons why Xero (ASX:XRO) shares are doing so well
- Why Creso Pharma and these ASX shares just hit 52-week highs or better
- 2 exciting small cap ASX shares to watch
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 recommends Altium. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of AUDINATEGL FPO and Xero. The Motley Fool Australia has recommended AUDINATEGL FPO. 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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