The two ASX growth shares in this article could be worth looking at in July 2021.
Businesses that are growing have the potential to deliver shareholder returns as the profit number compounds.
Here are two ASX growth shares that could be ideas:
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VanEck Vectors Morningstar Wide Moat ETF (ASX: MOAT)
This is an exchange-traded fund (ETF) that is offered by VanEck, one of the larger ETF providers on the market.
The idea of this investment is that it provides exposure to a diversified portfolio of attractive priced US companies with sustainable competitive advantages according to Morningstar's equity research team.
Morningstar rates businesses on how long it expects that competitive edge to remain for at least a decade and more likely than not be around in 20 years from now.
Investors in this ETF get exposure to a portfolio of around 50 names that are trading at attractive prices relative to Morningstar's estimate of fair value.
The largest six positions, which all have a weighting of less than 2.9% but more than 2.6%, are: Servicenow, Facebook, Microsoft, Alphabet, Guidewire and Salesforce.
Whilst all of the holdings are listed in the US, the underlying earnings are generated from many countries around the world. There are five sectors that have a weighting of more than 10%: healthcare, information technology, industrials, financials and consumer staples.
After the management fees of 0.49% per annum, it has produced an average net return per annum of 20.4% per annum. Past performance is no indicator of future performance.
Temple & Webster Group Ltd (ASX: TPW)
Temple & Webster is one of the largest online retailers of furniture and homewares.
The ASX growth share runs a drop ship model where products are shipped directly to the customers by suppliers. Customers can choose from over 200,000 products. This model enables faster delivery times and reduces the need to hold inventory, allowing for a larger product range. Temple & Webster also has a private label range that is sourced by the company directly.
Since 25 January 2021, the Temple & Webster share price has fallen by 22%. That's despite the business generating more revenue since then.
In the third quarter of FY21, revenue increased by 112%.
The company is focused on growth and it's going to heavily pursue that over the next few years. After that growth phase, it expects to have higher margins than many of its comparable offline peers.
It plans to invest in building brand awareness and achieve national brand status within three years to increase first time and repeat customers. The ASX growth share also plans to use tactical pricing and promotions to increase conversion.
Management want to invest in improving the customer experience with enhanced technology, data and personalisation and delivery experience.
The company also wants to improve the customer shopping journey with 3D and AI capabilities.
It wants to improve the product range with new category additions, private label expansion, new product development and launching exclusive ranges with key drop ship suppliers.
The company wants to grow its business to business sales and operational teams to capitalise on returning demand in the commercial sector.
