Leading broker names 2 ASX growth shares to buy

PointsBet Holdings Ltd (ASX:PBH) and this ASX growth share could be top options for investors according to one leading broker…

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Goldman Sachs has been running the ruler over a number of shares that presented at its recent Emerging Leaders Conference.

Two growing ASX tech shares that the broker is particularly positive on are listed below. Here’s why it rates them highly:

Hipages Group Holdings Ltd (ASX: HPG)

Hipages is an online platform and software as a service (SaaS) provider that connects tradies with residential and commercial consumers. At the last count, over three million Australians had used its platform, providing work to over 34,000 trade businesses that are subscribed to the platform.

Goldman Sachs is a big fan of the company and believes it has a very long runway for growth. This is due to its belief that it could one day win the same share of advertising spend as Carsales.Com Ltd (ASX: CAR) and REA Group Limited (ASX: REA) do in their respectively industries.

Goldman explained: “We see HPG as an attractive medium-term growth stock – HPG currently captures c.5% of the total industry advertising spend; by contrast REA/CAR capture c.40-60% of spending in their respective categories. As HPG builds out its ecosystem (including the imminent launch of the new “TradieCore” field service software solution), we see scope for HPG to increase its share towards these levels over the long term as the marketplace leader.”

The broker has a buy rating and $3.35 price target on its shares.

PointsBet Holdings Ltd (ASX: PBH)

Another growing company that Goldman is a fan of is PointsBet. It likes the sports betting company due to its strong position in a market expected to grow materially in the future.

In fact, the broker estimates that the US sports and iGaming market could be worth upwards of US$53 billion in the future. And thanks to its partnerships with sports teams and broadcasters, it feels it is well-placed to win market share.

Goldman said: “We like PBH due to i) PBH’s leverage to the burgeoning US Sports Betting and iGaming market which we forecast to be a US$53 bn TAM opportunity at maturity, ii) our view that PBH is well-placed to achieve 10% share in states it operates in, iii) upside risk to long-run sustainable margins in Aus and the US which was reaffirmed by the strong margin result in 3Q21, iv) Scalability benefits ahead noting positive impacts from the NBCUniversal deal to come and imminent launch of iGaming (which we believe will provide both cost and revenue synergies), and v) strong management team and execution track record.”

The broker has a buy rating and $17.20 price target on its shares.

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James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. owns shares of and recommends Hipages Group Holdings Ltd. and Pointsbet Holdings Ltd. The Motley Fool Australia has recommended carsales.com Limited, Pointsbet Holdings Ltd, and REA Group Limited. 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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