I think that one of the most exciting areas to invest in at the moment is the tech sector.
In this part of the market there are a large number of companies with the potential to grow strongly over the next decade and generate outsized returns for shareholders.
Three ASX tech shares that I would buy in July are listed below. Here’s why I like them:
Afterpay Ltd (ASX: APT)
I think this payments company could be a great long term option. In FY 2020, Afterpay has continued to smash expectations thanks to the increasing popularity of its buy now pay later platform with both consumers and retailers. The uptake of its platform has been especially strong with younger demographics, which are turning away from credit cards and looking for better ways to budget. I expect this trend to continue for the foreseeable future and be boosted by further geographic expansion in the coming years. This could make Afterpay shares long term market beaters.
Nearmap Ltd (ASX: NEA)
Another tech share to consider buying is this aerial imagery technology and location data company. Thanks to the increasing demand for its services in both Australia and North America, Nearmap has been growing its sales at a very strong rate over the last few years. The good news is that I believe the company can continue this impressive growth for a long time to come thanks to its massive opportunity in a highly fragmented market, the launch of several exciting new products, and its potential expansion into new geographies.
Xero Limited (ASX: XRO)
A final tech share to consider buying is Xero. It is one of the world’s leading cloud-based business and accounting software providers. Xero recently reported its FY 2020 results and revealed further impressive growth in sales and operating earnings. This was driven by strong customer growth and its sky high retention rate. I believe the latter demonstrates both the quality and stickiness of its platform. Another positive is its modest market share in North America. At present it has just 241,000 subscribers in the key market. This compares to 914,000 subscribers in a materially smaller ANZ market.
We hear it over and over from investors, “I wish I had bought Altium or Afterpay when they were first recommended by The Motley Fool. I’d be sitting on a gold mine!” And it’s true.
And while Altium and Afterpay have had a good run, we think these 5 other stocks are screaming buys. And you can buy them now for less than $5 a share!
*Extreme Opportunities returns as of June 5th 2020
More reading
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- Zip and Openpay were among the most traded shares on the ASX last week
- 5 of the worst performing ASX shares from last week
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 Nearmap Ltd. and Xero. The Motley Fool Australia owns shares of AFTERPAY T FPO. The Motley Fool Australia has recommended Nearmap Ltd. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.
The post Why I would buy Afterpay and these exciting ASX tech shares appeared first on Motley Fool Australia.
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