2 ASX growth shares to buy that keep delivering wins

This article about two ASX shares that keep delivering wins for the company and shareholders, including Bapcor Ltd (ASX:BAP).

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The two ASX shares in this article keep delivering wins for shareholders and generating growth.

Indeed, these two businesses produced some good news earlier today:

Bapcor Ltd (ASX: BAP)

Bapcor is an auto parts ASX share with a market capitalisation of around $2.5 billion.

Listed investment company WAM Research Limited (ASX: WAX), run by fund manager Wilson Asset Management, is a fan of the business and it’s currently one of the biggest 20 holdings in the portfolio.

Bapcor released a trading update today. It said that its strong growth has continued since the October trading update.

For the five months to the end of November, group revenue was up around 26%. Management said the company was achieving operating leverage from lower expenses in areas such as travel and other areas of discretionary expenditure, as well as lower interest rates and the contribution from Truckline which was not included in the prior corresponding period.

For the first half of FY21 Bapcor is expecting to achieve revenue growth of at least 25% over the prior corresponding period in FY20, with net profit after tax (NPAT) increasing by at least 50% compared to the prior corresponding period.

Bapcor reminded investors that trade businesses, like Burson, typically perform well in difficult conditions, which is what the country is going through at the moment. Bapcor’s trade and wholesale businesses represent over 80% of Bapcor’s overall business with retail making up the rest.

The ASX share also said that its retail revenue was up around 40% over the prior corresponding period. This growth has been supported by changes in the overall retail ‘go to market’ strategy with improvements in its e-commerce capabilities, improved catalogues, expanded and improved product ranges and continued store expansion. All of this is expected to continue to drive market growth from here.

Bapcor also said that the construction of its new Victorian distribution is progressing well with the building expected to be handed over in February 2021 and the automated picking system operational in the following six months. Management said that this is an exciting development that will deliver significant operational benefits.

According to Commsec estimates, at the current Bapcor share price, it’s valued at 19x FY23’s estimated earnings.

Pro Medicus Ltd (ASX: PME)

Pro Medicus describes itself as a leading medical imaging IT provider that was founded in 1983. According to the ASX, it has a market capitalisation of $3.25 billion.

Pro Medicus announced today it had signed a 5-year, $18 million deal with MedStar Health. The company’s Visage technology will replace MedStar’s legacy PACS across 10 hospitals, representing the largest health system in the Maryland and District of Columbia (DC) region.

The contract is for the full suite of Visage 7 modules, including Visage 7 Viewer, Visage 7 Open Archive and Visage 7 Workflow. The Visage 7 platform will be fully deployed in the public cloud using the Google Cloud Platform.

Pro Medicus said this contract is a transaction-based model with potential upside, and it extends Pro Medicus’ rapidly growing footprint North America.

Dr Sam Hupert, Pro Medicus CEO, said: “MedStar went through an extensive evaluation process including a pilot that not only benchmarked Visage 7 compared to on-premise systems from other vendors, it served to verify the speed of Visage 7 in the public cloud.

“Unlike systems from other vendors, Visage has been developed from the ground up for cloud deployment. Traditionally, our clients have deployed Visage in their own “private cloud” where all images are sent to a single, central server and streamed on demand from there. This deal signifies a shift in the way US healthcare providers are now starting to think about public cloud platforms.”

This certainly isn’t the first major deal Pro Medicus has won in 2020. It has renewed with Zwanger-Pesiri for a $8.5 million deal, it has won a $10 million deal with Ludwig-Maximilians University, it won a $25 million contract with NYU Langone Health and it signed a $22 million deal with Northwestern Memorial Healthcare.

At the current Pro Medicus share price it’s valued at 68x FY23’s estimated earnings according to Commsec.

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Tristan Harrison has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. recommends Pro Medicus Ltd. The Motley Fool Australia owns shares of and has recommended Bapcor and Pro Medicus Ltd. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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