Are you looking to add a growth share or two to your portfolio next month? Then take a look at the two ASX shares listed below.
Here’s why they could be growth shares to buy right now:
ELMO Software Ltd (ASX: ELO)
ELMO is a cloud-based human resources and payroll software company that provides businesses with a unified platform to streamline a wide range of processes.
It has been a strong performer in recent years and pleasingly this continued in FY 2021 despite the pandemic. Last month ELMO released its half year results and revealed that its annualised recurring revenue (ARR) had grown to $74.2 million. This was driven by a combination of organic growth and the benefits of acquisitions that have strengthened its offering and increased its addressable market.
Morgan Stanley was pleased with its half year results and put an overweight rating and $9.70 price target on its shares. It is confident on its second half prospects and appears confident it will achieve its FY 2021 guidance.
Pro Medicus Limited (ASX: PME)
Another growth share to look at is Pro Medicus. It is a healthcare technology company that provides radiology information systems (RIS), picture archiving and communication systems (PACS), and advanced visualisation solutions to healthcare organisations globally.
It has been performing positively during the pandemic and reported strong revenue and profit growth last month. For the six months ended 31 December, Pro Medicus delivered a 7.8% increase in revenue to $31.6 million and a 25.9% jump in underlying profit before tax to $18.76 million.
Pleasingly, since the end of the half the company has won a number of lucrative long term contracts with major healthcare institutions. And thanks to its industry-leading software, its sizeable market opportunity, and the shift away from legacy systems, it wouldn’t be a surprise to see more contract wins in the coming months.
Goldman Sachs is a fan and recently upgraded Pro Medicus’ shares to a buy rating with a $53.80 price target. It believes it is well-positioned to grow its earnings at a rapid rate over the coming years.
Where to invest $1,000 right now
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More reading
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- 2 ASX tech shares growing rapidly to buy
- 2 ASX shares delivering irresistible growth
- ELMO (ASX:ELO)’s disappointing Supreme Court decision revealed
- 3 ASX Healthcare shares feeling a little under the weather
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 Elmo Software and Pro Medicus Ltd. The Motley Fool Australia has recommended Elmo Software and Pro Medicus Ltd. 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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