I'm a big fan of growth shares and feel very lucky to have a large number to choose from on the Australian share market.
But with so many to choose from, it can be hard to decide which ones to buy.
To narrow things down, I have picked out three exciting ASX growth shares that I believe could generate outsized returns for investors over the 2020s:
Bubs Australia Ltd (ASX: BUB)
The first growth share to look at is Bubs. It is a goat's milk-focused infant formula and baby food company which has a growing footprint online in China and in supermarkets and pharmacies throughout Australia. The latter in particular has been boosted materially in recent months with increasing shelf space at major supermarkets. I believe this and its expansion into cow's milk infant formula are likely to lead to its sales growth accelerating in FY 2021. Another positive is that the company appears to have now reached a scale which will make its operations more and more profitable over the coming years. As a result, I think the Bubs share price could charge notably higher over the next decade.
Pushpay Holdings Group Ltd (ASX: PPH)
Another ASX growth share that I think has enormous potential is Pushpay. It is a donor management platform provider for the faith sector. It looks well-positioned for growth thanks to the shift to a cashless society and its leadership position in a church market which is rapidly embracing digital transformation. Management appears very confident in its future prospects and has set itself a target to win a 50% share of the medium to large church market in the future. This represents a US$1 billion revenue opportunity and is many times greater than its FY 2020's revenue of US$127.5 million. If it delivers on this, I believe Pushpay's shares could provide market-beating returns for investors in the future.
Xero Limited (ASX: XRO)
A third ASX growth share to consider buying is Xero. Although this cloud accounting software company had a sizeable 2.285 million subscribers at the end of FY 2020, I still believe this figure can rise materially in the future. Especially given how it estimates that less than 20% of the global English-speaking target market is using cloud-based accounting software at present. Combined with price increases, its high retention rate, and the benefits of scale, I expect this to lead to above-average earnings growth over the next decade. In light of this, I'm confident the Xero share price can continue its market-beating form for some time to come.
