Why I think GetSwift Ltd could be the next big tech share on the ASX

In the last few years a number of high quality tech shares have emerged on the Australian share market such as Aconex Ltd (ASX: ACX) and Altium Limited (ASX: ALU).

Well, I think it is time to add another to the list:  GetSwift Ltd (ASX: GSW).

Year-to-date the GetSwift share price may be up almost 200%, but I believe there is still significant growth ahead for this fledgling company.

Here are four reasons why I think it could be Australia’s next tech superstar:

Its software continues to grow in popularity.

GetSwift provides affordable web-based logistics software to business owners allowing them to manage their local delivery operations without having to invest in logistics dispatch software, courier apps, and real time delivery tracking technology. In just the last few months the company has announced major deals with Commonwealth Bank of Australia (ASX: CBA), Pizza Hut, The Fruit Box, and Hungry Harvest. This led to a 49% increase in quarter-on-quarter deliveries.

The Commonwealth Bank deal.

The deal with the Commonwealth Bank means that the GetSwift platform has been integrated onto its Albert point of sale terminals. Over the next five years management conservatively estimates the deal will result in over 257 million deliveries through its platform. GetSwift charges 29 cents per delivery handled on its platform, though customers that deliver significantly more than average are likely to benefit from discounts. Based on an average of 25 cents per delivery, this deal would be worth upwards of $64 million over the five years.

Significant growth potential.

But the Commonwealth Bank deal is just one of a number of lucrative deals that could provide GetSwift with significant growth potential. For example, Pizza Hut has 320 restaurants in Australia offering delivery, the Fruit Box Group currently delivers more than 1.5 million fruit boxes and milk deliveries each year, and a deal with Quick Service Restaurant Holdings allows its numerous Red Rooster, Oporto, and Chicken Treat restaurants to leverage the GetSwift service.

Small business opportunities.

But it isn’t just national and global chains that stand to benefit from using its services. As well as coordinating deliveries, the software allows idled delivery drivers to pick up jobs from other users of the platform a la UberEATS. This means that even small mom and pop stores could offer speedy home delivery services to their customers. I feel this could be a great way for them to compete against ecommerce giants, like Amazon and I imagine the service will become integral to many small businesses around the world.

Foolish Takeaway.

Overall, I believe this makes GetSwift a great buy and hold investment option today.

While its shares may have rallied strongly in the last few months and means the company now has a market cap of approximately $100 million, if its forecasts prove accurate then I believe this is only the beginning of significantly greater gains.

Though it is worth remembering that due to being a newly-listed small-cap share with a limited track record, it could be considered a high-risk investment. For this reason investors may want to restrict an investment to just a small part of their portfolio.

Finally, if GetSwift is too small for your liking then these fast-growing blue-chip shares could be perfect for you. Thanks to recent volatility I believe these shares are trading at very attractive prices again.

Top 3 ASX Blue Chips To Buy In 2017

For many, blue chip stocks means stability, profitability and regular dividends, often fully franked..

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Motley Fool contributor James Mickleboro owns shares in GetSwift Ltd. The Motley Fool Australia has no position in any of the stocks mentioned. 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 Bruce Jackson.

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