Although the ANZ region's tech sector is small in comparison to those in the United States, Europe, and China, it isn't short of quality.
I believe there are a good number of quality tech companies which are worthy of a spot in most portfolios.
Three of my favourites are listed below. Here's why I like them:
Afterpay Ltd (ASX: APT)
The first ASX tech share to consider buying is Afterpay. I think the payments company could be a fantastic long term investment due to the sizeable market opportunity it has in the ANZ, UK, and United States markets. These markets alone have the potential to drive strong sales growth for a long time to come. But I don't expect the company to stop there. It is already plotting an expansion into Canada and I wouldn't be surprised to see it launch in mainland Europe and Asia in the coming years. The latter could be supported by its new substantial shareholder, Tencent Holdings. It is the US$535 billion owner of WeChat.
Nearmap Ltd (ASX: NEA)
Another ASX tech share to look at is Nearmap. It is a leading aerial imagery technology and location data company which also has a sizeable market opportunity. A recent market update reveals that its annualised contract value (ACV) has hit $102 million financial year to date. This means Nearmap is on course to achieve its ACV guidance of $103 million to $107 million in FY 2020. This is still only a fraction of its total addressable market (TAM), which is estimated to be worth $2.9 billion per year. And it is worth noting that this TAM relates to the countries it currently operates in. As with Afterpay, I believe Nearmap could expand into other territories in the future.
Xero Limited (ASX: XRO)
A final tech share to consider buying is Xero. It is a leading cloud-based business and accounting software provider which has been growing at a rapid rate for many years. This has led to the company surpassing 2 million subscriptions for the first time earlier this year. While this may seem like a large number, it still has a long runway for growth over the next decade. Especially given how less than 20% of the global English-speaking target market is believed to be using cloud-based accounting software at present. I expect more businesses to shift to this technology in the coming years, underpinning solid subscription and sales growth.
