With the S&P/ASX 200 Index (ASX: XJO) down over the past few weeks and steep share price falls across many sectors, this has understandably made a lot of people hesitant about investing right now.
It is important to keep in mind that share markets factor in the impact of negative events fairly quickly, and although we don't know if we have hit the bottom of the market yet, I believe that the worst of the share market falls are probably behind us.
The ASX tech sector in particular has seen heavy falls recently, however the underlying fundamentals of most of these companies still remain strong, and most remain well positioned for long term growth.
Here are 2 of my top ASX tech share picks right now.
Altium Limited (ASX: ALU)
Altium writes software to help design printed circuit boards for a broad range of electronic devices, from computers to cars, and an increasing number of devices that that make up the 'Internet of Things'. All these devices will play an increasingly important role in our lives over the next decade.
Altium has operations in the US, Europe, China, the Middle East and Africa. During the first half of FY20, Altium reported revenue of US$92.9 million, a 19% increase over the prior corresponding period. The company has a very solid balance sheet with no debt on its books.
I believe that the growing need for electronics through the rise of smart connected devices will see continued demand for Altium's products over the next 5–10 years. Altium does have a relatively high price-to-earnings (P/E) ratio of 47, however I feel that this figure is still reasonable for a tech share with strong long term growth potential.
Nearmap Ltd (ASX: NEA)
Nearmap provides geospatial map technology for businesses, enterprises and government, with a customer base that spans across Australia, New Zealand, the US, and Canada.
The sharp recent correction to the Nearmap share price has offered investors a good opportunity to purchase this ASX tech share at a more favourable price, in my view.
Nearmap's recent investments in sales and marketing in North America appear to be on track and are delivering some positive results. Nearmap recently commented that it will look to other geographies in the future, possibly next year, however its current strategy outside of Australia still remains very much in North America.
Additionally, while there are other competitors out there in the market such as Aerometrex Ltd (ASX: AMX), no company globally has yet been able to replicate Nearmap's subscription-based business model.
