Goldman Sachs says these ASX growth shares are market-thumping buys

Looking for some additions to your portfolio? Listed below are two ASX growth shares that have been given buy ratings by Goldman Sachs.

Here’s why its analysts rate them highly:

Breville Group Ltd (ASX: BRG)

The first ASX growth share that is rated as a buy by Goldman is Breville. It is the leading appliance manufacturer behind brands such as Breville, Sage, Kambrook, and Baratza.

Thanks to the success of the company’s global expansion and its consistent in research and development, Breville’s appliances are found in kitchens across the globe. This has underpinned consistently solid earnings growth over the last decade.

Pleasingly, Goldman Sachs believes this can continue and is forecasting double-digit earnings growth through to at least FY 2025. It said:

Looking forward we […] expect BRG will continue to execute on GP margin expansion. We remain supportive of BRG’s characteristics as a high quality name in a secular growth category and believe they will be able to demonstrate revenue and EBIT CAGR of 7.6% and 11.1% over FY22-25.

Goldman has a buy rating and $22.70 price target on the company’s shares.

Life360 Inc (ASX: 360)

Another ASX growth share that Goldman Sachs is bullish on is Life360.

It is a leading player in the digital consumer subscription services market with its popular Life360 app. And when I say popular, I mean popular. At the last count, the company had almost 50 million subscribers on its platform.

Life360’s shares have been hammered over the last 12 months after investors sold down loss-making tech stocks. However, with the company expecting to be profitable soon, Goldman suspects that a major re-rating could be on the cards. It explained:

In our view Life360 is approaching an inflection point as it proves the pricing power of its subscription business model and moves out of the non-profitable tech basket. The full-year impact of price increases drives the majority of CY23 subscription revenue growth, with possible upside to paying subscribers should Tile bundling materially lift payer conversion (expected launch late-1Q23).

Goldman has a buy rating and $7.85 price target on Life360’s shares.

The post Goldman Sachs says these ASX growth shares are market-thumping buys appeared first on The Motley Fool Australia.

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Motley Fool contributor James Mickleboro has positions in Life360. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Life360. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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