I'm a huge fan of quality growth shares and believe the Australian share market is home to a great number of them.
The only problem though is that many of them trade on extraordinarily high earnings multiples.
Take for example Domino's Pizza Enterprises Ltd. (ASX: DMP). Even though its shares are almost 24% lower than their 52-week high, they are still changing hands at 47x trailing earnings.
Thankfully though there are a few that trade on reasonable valuations at present. Here are three which caught my eye:
The Australian Pharmaceutical Industries Ltd (ASX: API) share price may be up 6% year-to-date, but its shares are still changing hands at 18x trailing earnings. I think this is a fair multiple for the company behind the Priceline pharmacy brand to trade at, especially with the company reporting a 15% increase in underlying half-year net profit last week.
The Appen Ltd (ASX: APX) share price has tumbled around 6% this year, meaning its shares are now priced at 25x trailing earnings. Whilst this may still be a premium to the market-average, I believe the company is well placed to profit from the increasing use of machine learning and artificial intelligence. Management expects earnings growth in excess of 20% this year.
The RCG Corporation Ltd (ASX: RCG) share price has fallen a massive 39% so far this year. Whilst there are concerns that retail behemoth Amazon could crush retailers when it launches in Australia later this year, at just under 13x trailing earnings I think this footwear retailer offers a compelling risk/reward. Especially as the company recently delivered a 34% increase in underlying half-year profit.