I think there are a number of ASX growth share opportunities in September 2020.
The growth delivered by businesses like Afterpay Ltd (ASX: APT) and Zip Co Ltd (ASX: Z1P) is impressive – but who knows if they are worth buying today after the meteoric rise?
There are still plenty of other opportunities that aren't priced to the moon.
Here are four ASX growth shares I'd buy in September:
Citadel Group Ltd (ASX: CGL)
Citadel is a technology business that provides software to help organisations manage data. It serves clients in sectors like education, defence and healthcare.
Its underlying FY20 result was impressive in my opinion. Total revenue grew by 29.4% to $128.4 million and total software revenue increased by 35.7% to $47.5 million.
I expect FY21 to be a bumper year for the ASX growth share with the Wellbeing business under Citadel's ownership for the full year. Wellbeing is a UK healthcare software business with high levels of recurring revenue and an attractively high earnings before interest, tax, depreciation and amortisation (EBITDA) margin.
The world is becoming increasingly reliant on software and I think Citadel is a good ASX growth share to get exposure to this trend.
At the current Citadel share price it's trading at under 14x FY22's estimated earnings.
Pushpay Holdings Ltd (ASX: PPH)
I think Pushpay is one of the most promising ASX growth shares around.
It's an electronic donation payment business that facilitates digital giving to not-for-profits. Its current client base is largely medium and large US churches. This provides exposure to a large (and growing) amount of electronic donations. The opportunity so large that Pushpay is targeting annual revenue of US$1 billion per annum over the long-term.
In FY20 alone it grew its gross margin from 60% to 65%, which shows the business has excellent profit margin improvement potential over the long-term as it scales. As it grows its revenue it should be able to become much more profitable, at the net profit after tax level, as time goes on.
The ASX growth share is looking to double its earnings before interest, tax, depreciation, amortisation and foreign currency (EBITDAF) to at least US$50 million in FY21.
At the current Pushpay share price it's trading at 35x FY22's estimated earnings.
City Chic Collective Ltd (ASX: CCX)
City Chic is steadily becoming a world leader in the retailing of plus-size women's clothes, footwear and accessories. It has a national footprint of City Chic stores across Australia. It also has websites in Australia and the northern hemisphere. The company has partnerships with northern hemisphere partners like ASOS.
I particularly like the ASX growth share's strategy of buying distressed competitors in the US. The United States is a huge market compared to Australia. City Chic aims to turn the acquired US retailers into online-only offerings – which would have lower costs and still have a national footprint. The latest target is a business called Catherines.
In FY20 City Chic grew revenue by 31% to $194.5 million. Around 65% of total sales were online and 42% of global sales were in the northern hemisphere. I think City Chic has plenty of pleasing factors which will help long-term growth.
At the current City Chic share price it's trading at 22x FY22's estimated earnings.
BWX Ltd (ASX: BWX)
BWX is one of the world's leading natural beauty businesses. The ASX growth share sells a number of brands including Sukin, Mineral Fusion and Andalou Naturals.
The company has really turned things around under new management. FY20 was a strong year with revenue growth of 26%, EBITDA growth of 30% and statutory net profit growth of 59% to $15.2 million.
BWX continues to increase its market share and gross profit margin, so I think it's definitely an ASX growth share to watch because increasing profitability as it grows revenue is very attractive for market-beating returns.
It's expecting double digit revenue and EBITDA growth in FY21. At the current BWX share price it's trading at 31x FY22's estimated earnings.
Foolish takeaway
I think each of these ASX growth shares have very good outlooks for the next few years. Their valuations look reasonable for their growth prospects and they have plenty of international avenues for growth. At the current prices I think Citadel and Pushpay looks particularly good value for the long-term.
