Experts say these ASX tech shares would be excellent buys

A young female investor sits in her home office looking at her ipad and smiling as she sees the QBE share price rising

A young female investor sits in her home office looking at her ipad and smiling as she sees the QBE share price rising

If you’re looking to invest in the tech sector, then check out the two tech shares listed below.

Both of these ASX tech shares have been named as buys and tipped for strong growth in the future. Here’s what you need to know:

Aristocrat Leisure Limited (ASX: ALL)

The first ASX tech share to look at is Aristocrat. It is a leading gaming technology company with a portfolio of popular poker machines and mobile games.

The team at Morgans is very positive on the company’s outlook. This is due to its high quality gaming portfolio, its strong balance sheet, and its plans to move into real money gaming.

The broker summarised its bullish view. It said:

We expect ALL to continue to take market share in all its product segments. Demand for its gaming machines and digital games is resilient to economic cycles. […] With $3.3bn of currently available liquidity, ALL has significant funding capacity for growth, even after the buyback. It has a stated ambition to build a meaningful presence in the rapidly growing online real money gaming segment, which we believe may be achieved both through organic investment and inorganic acquisitions.

Morgans currently has an add rating and $43.00 price target on Aristocrat’s shares. Based on the current Aristocrat share price of $35.74, this implies potential upside of 20% for investors.

Readytech Holdings Ltd (ASX: RDY)

Another ASX tech share that could be worth considering is Readytech. It is a growing provider of enterprise software to defensive market verticals such as higher education, human resources, work pathways, and local government.

Analysts at Goldman Sachs are fans of the company due to its high recurring revenue and strong position in defensive areas of the market that are under-served by large enterprise software competitors. Morgans feels that this bodes well for the company’s performance in the current environment.

The broker commented:

In our view, RDY will continue to grow mid-teens organically while making accretive acquisitions (such as IT Vision), with profitability underpinned by solid software metrics including low churn at ~3% and high LTV/CAC. RDY serves defensive end markets (e.g. higher education, local government) and has high recurring revenue (>85%) which should protect the company’s earnings profile in an economic downturn.

Goldman has a buy rating and $4.60 price target on Readytech’s shares. Based on the current Readytech share price of $3.02, this suggests potential upside of 52% for investors.

The post Experts say these ASX tech shares would be excellent buys appeared first on The Motley Fool Australia.

Wondering where you should invest $1,000 right 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 over ten years has provided thousands of paying members with stock picks that have doubled, tripled or even more.* Scott just revealed what he believes could be the “five best ASX stocks” for investors to buy right now. These stocks are trading at near dirt-cheap prices and Scott thinks they could be great buys right now

See The 5 Stocks
*Returns as of July 7 2022

(function() {
function setButtonColorDefaults(param, property, defaultValue) {
if( !param || !param.includes(‘#’)) {
var button = document.getElementsByClassName(“pitch-snippet”)[0].getElementsByClassName(“pitch-button”)[0];
button.style[property] = defaultValue;
}
}

setButtonColorDefaults(“#0095C8”, ‘background’, ‘#5FA85D’);
setButtonColorDefaults(“#0095C8”, ‘border-color’, ‘#43A24A’);
setButtonColorDefaults(“#fff”, ‘color’, ‘#fff’);
})()

More reading

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Readytech Holdings Ltd. The Motley Fool Australia has recommended Readytech Holdings Ltd. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

from The Motley Fool Australia https://ift.tt/408STPb

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s