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2 growth shares to research this weekend

It’s quite hard to find good value growth shares at the moment. Many people believe Altium Limited (ASX: ALU), Afterpay Touch Group Ltd (ASX: APT), Appen Ltd (ASX: APX) and WiseTech Global Ltd (ASX: WTC) are wildly overvalued.

So, where can you find good value growth? Firstly, I think we have to look away from the technology sector – there’s a lot of money in Australia searching for a home and it’s all found its way to a small group of shares.

Here are two shares that look very interesting to me:

MNF Group Ltd (ASX: MNF)

MNF Group is one of Australia’s leading voice over internet protocol (VoIP) businesses. It has large customers including governments, Uber and Skype.

Investors seem very unconvinced of the idea to build a retail mobile telco brand aimed at baby boomers in regional areas called Pennytel. It’s taking up a decent amount of investment in the short-term, but if it works out it could be another good profit avenue.

MNF has good profit margins and a growing revenue stream from its business segments. MNF seems to be a good idea to me to indirectly benefit from the increasingly technological world.

It’s currently trading at 30x FY18’s earnings, but earnings could quickly recover next year if Pennytel pays off.

Paragon Care Ltd (ASX: PGC)

Paragon is a healthcare supplies business with items like beds and devices for clients such as hospitals and aged care facilities.

Management have estimated that Paragon’s target market is roughly $9 billion per annum, yet Paragon’s share is only 3% of this, meaning there is significant organic and inorganic growth potential.

For now the business is targeting organic growth of 10% and an earnings before interest, tax, depreciation and amortisation (EBITDA) margin of 15% – in FY19 management are predicting an EBITDA margin of 13.8%.

The ageing population tailwind should be quite beneficial for Paragon over time.

It’s currently trading at just over 11x FY19’s estimated earnings.

Foolish takeaway

I believe both of these businesses could comfortably be market-beaters due to the low expectations of their business plans succeeding. Out of the two I’m more drawn to Paragon due to its long tailwinds and high dividend yield, but both would make good options.

Another growth stock that you should consider researching is this market-disrupting ASX share.

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Motley Fool contributor Tristan Harrison owns shares of Altium and Paragon Care Limited. The Motley Fool Australia owns shares of and has recommended MNF Group Limited. The Motley Fool Australia owns shares of AFTERPAY T FPO, Altium, Appen Ltd, and WiseTech Global. The Motley Fool Australia has recommended Paragon Care Limited. 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.

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