The S&P/ASX 200 Index (ASX: XJO) and All Ordinaries Index (ASX: XAO) are starting to look firmer following recent weakness in ASX tech shares and a broad-based sell off in the Nasdaq. This could be a window of opportunity to explore some leading names in the tech sector. Here are two ASX tech shares I'd consider buying with $10,000.
2 ASX tech shares I'd buy today
1. Megaport Ltd (ASX: MP1)
Connectivity and network services provider Megaport is one step closer to earnings before interest, taxes, depreciation and amortisation (EBITDA) breakeven following a strong performance in FY20. The company delivered a 66% increase in revenue to $58 million, a 24% increase in customers to 1,842 and a 45% increase in its number of services (ports, connections, routers and internet exchanges) to 16,712.
Megaport previously raised $50 million in April to further strengthen its balance sheet and is using the proceeds of the capital raising to further accelerate sales, product development and platform opportunities in the near and medium term. At 30 June 2020, the company had $166.9 million in cash. Megaport is getting closer to delivering the scale and revenue it needs to reach EBITDA breakeven, which it anticipates achieving in FY21.
Overall, COVID-19 has been a tailwind for many ASX tech shares. I believe Megaport is currently experiencing significant growth with a pathway to profitability. With many ASX tech shares looking stronger after the recent tech sell-off, the Megaport share price might be one to watch.
2. Bigtincan Holdings Ltd (ASX: BTH)
Bigtincan has truly taken off following its strong FY20 results. The Bigtincan share price jumped more than 10% on the day of its FY20 results to close at a near all time record high of $1.00. One month on, and its share price has soared another 35% to currently trade at $1.35 (at the time of writing).
The company is a provider of software that brings together sales content management, customer facing training, coaching, onboarding and document management to help companies increase sales win rates, reduce expenses and improve customer satisfaction. In FY20 the company delivered a 56% increase in revenue to $31 million with a significant $71.9 million cash at hand. It had previously achieved significant contract wins with big names such as DXC Technology Co (NYSE: DXC), Sephora USA and Nike Inc (NYSE: NKE).
The company is clearly building momentum and forecasts FY21 revenue to be in the range of $41 to $44 million. Its $71.9 million cash position also means the company can pursue and accelerate growth opportunities and explore any potential strategic mergers and acquisitions moving forward. I believe Bigtincan could be a leading ASX tech share to watch closely into the future.
