But there are plenty of spotlight-worthy tech shares that aren’t part of the WAAAX group. Here are 3 ASX tech opportunities that could be a better way to get rich.
1. EML Payments Ltd (ASX: EML)
EML has traditionally provided payment technology solutions for payouts, gift incentives and rewards. However, the company has recently made a game changing $423 million acquisition of Irish firm Prepaid Financial Services that diversifies the business to include prepaid payments, digital banking capabilities and other flexible software solutions to financial and non-financial institutions.
In EML’s Q1FY20 update, the company forecasts an FY20 earnings before interest, tax, depreciation and amortisation (EBITDA) between $38.5–42.5 million, which would represent a growth of 29–42% (excluding its acquisition). Prepaid had an EBITDA of $17 million and a forecasted EBITDA of $24 million in FY20. The combined group would have an FY20 EBITDA growth of at least 50% or greater.
The EML share price is up more than 15% since the announcement of its acquisition and capital raising. I believe the capital raising discount and dilution will cap any further potential share price gains in the short-term. However, EML has now enhanced its growth capabilities, product suite and geographical footprint. It is worth watching closely.
2. Dubber Corp Ltd (ASX: DUB)
The Dubber share price has struggled to reflect the optimism of the general market and is down 10% in the past four weeks. The company aims to disrupt the call recording industry – traditionally a fixed capacity, with expensive capital upkeep and a lengthy deployment. By contrast, with its innovative cloud recording software, Dubber’s implementation is rapid with zero capital expenditure and unlimited scale.
The company has shown some early signs of adoption and growth with FY19 revenues increasing by 132% to $7.3 million, while losses decreased to $9.6 million from $11.3 million in FY18. Dubber has identified some key growth areas, including partnering up with more telecommunication service providers globally, extending opportunities via Cisco/BroadCloud and a continued commercial partnership with IBM. In FY19, Dubber increased its client base to 43 telecommunication carriers, compared to 23 in FY18.
3. Serko Ltd (ASX: SKO)
Serko is an online travel booking and expense management company. The company has recently entered into an agreement with booking.com that will offer and promote its Serko Zeno platform. To accelerate the global rollout of Serko Zeno, the company announced a NZ$45 million capital raising. Bookings Inc will cornerstone the capital raising, resulting in an approximate 4.7% shareholding in Serko. This is a significant partnership and investment that could be the next leg up for Serko.
The company provided a H1FY20 update that cited a 29% increase in operating revenue and a 38% increase in recurring revenue, with recurring revenue representing 91% of its operating revenue. The support and partnership with booking.com could be what the company needs to boost its growth potential.
5 stocks under $5
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Lina Lim has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. owns shares of Emerchants Limited and Serko Ltd. The Motley Fool Australia has recommended Emerchants Limited and Serko 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.