The tech sector has come under pressure this week following the market weakness caused by trade war tensions and weak economic data out of both the United States and China.
I think this has pulled the shares of a number of quality tech companies to very attractive levels for a long term investment.
Here’s why I would be a buyer of these ASX tech shares today:
Altium Limited (ASX: ALU)
The Altium share price is trading around 17% lower than its 52-week high at present. Whilst this still means its shares are trading at a notable premium to the market average, I believe it is a very attractive level for a company with such outstanding growth potential. I remain confident the printed circuit board (PCB) design software company is well-positioned to deliver exceptionally strong earnings growth over the next decade thanks to its industry-leading software platform and its exposure to the fast-growing Internet of Things market.
Appen Ltd (ASX: APX)
The shares of this leading developer of high-quality, human annotated datasets for machine learning and artificial intelligence have shed almost 36% of their value since peaking at $32.00 in July. This has left Appen’s shares changing hands at ~32x estimated FY 2020, which I think is great value given its outstanding long-term growth potential thanks to increasing demand for its services due to the proliferation of machine learning and artificial intelligence.
Nearmap Ltd (ASX: NEA)
Another high quality tech share that has come under pressure recently is Nearmap. The shares of the leading aerial imagery technology and location data company are down almost 44% from their 52-week high. I think this selloff has pulled its shares down to a very attractive level based on its current growth profile. Due to the quality of its platform, increasing demand, and new product launches, I believe Nearmap is well-placed for further strong growth in FY 2020 and beyond
As well as Nearmap, I think that these shares look dirt cheap right now.
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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 Altium and Nearmap Ltd. The Motley Fool Australia owns shares of Appen Ltd. 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.