Analysts say these exciting ASX growth shares are buys this month

A man sees some good news on his phone and gives a little cheer.

A man sees some good news on his phone and gives a little cheer.

Looking for a growth share or maybe two to buy? If you are, you may want to look at the two listed below.

Here’s why these ASX growth shares are rated highly right now:

Temple & Webster Group Ltd (ASX: TPW)

The first ASX growth share that analysts are bullish on is Temple & Webster.

It is Australia’s leading online retailer of furniture and homewares. It operates largely through a drop-shipping model, which is complemented by a private label range sourced directly by management.

While a weaker than expected trading update with its half-year results spooked the market last month, Goldman Sachs believes the selloff that ensued has created a buying opportunity. Particularly given its belief that the soft update reflects “the lapping of omicron rather than a deterioration in underlying trends.”

In light of this, the broker has put a buy rating and $6.50 price target on the company’s shares. It adds:

The long term structural growth opportunity is unchanged: we forecast a 21% 10-yr EBITDA CAGR driven by consolidation of market share and growing online penetration.

Xero Limited (ASX: XRO)

Another ASX growth that has been named as a buy is Xero. Xero is a global small business platform which provides its 3.3 million global subscribers with a core accounting solution, as well as payroll, workforce management, expenses and projects solutions.

In addition, Xero provides access to financial services, an ecosystem of more than 1,000 connected apps, and more than 300 connections to banks and other financial institutions.

Citi is a fan of the company and is forecasting very strong growth over the coming years. And while the current operating environment is not ideal, the broker believes that things are actually better than expected. It commented:

Our analysis of company insolvency and formation data points to normalising trends, with insolvency increasing and new business formation slowing in the Dec quarter across most markets except for the UK. However, except for NZ, the increase in insolvencies in 2H23e to date is tracking below our 2H23e churn assumptions. Website visits and app downloads are slowing across most markets; however, we see this as less correlated with subscriber growth but do note that add-on app downloads (Xero Me, Planday) are seeing good growth, which is positive for ARPU.

Citi has a buy rating and $92.40 price target on the company’s shares.

The post Analysts say these exciting ASX growth shares are buys this month 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 March 1 2023

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

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

More reading

Motley Fool contributor James Mickleboro has positions in Xero. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Temple & Webster Group and Xero. The Motley Fool Australia has positions in and has recommended Xero. The Motley Fool Australia has recommended Temple & Webster Group. 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

Leave a Reply

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

You are commenting using your 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