There are some good ASX share candidates that might be worth considering in July 2021.
We are already halfway through the 2021 calendar year. Share prices are changing all the time, so that can lead to different businesses being potential opportunities at different times.
The two ASX shares in this article are growing quickly and might be worth looking at for the longer-term:
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Pushpay Holdings Ltd (ASX: PPH)
Pushpay is an electronic donation business. It processes electronic payments for large and medium US churches.
It has large long-term goals, but in FY21 it processed approximately US$7 billion (which was up 39%). This led to operating revenue increasing by 40%.
The company deliberately chose the best tools when it first set up its systems. Not only did that mean that clients get the best software to use, but it also meant Pushpay had very scalable technology. This is translating into operating leverage for the business.
In FY21 alone, the earnings before interest, tax, depreciation, amortisation and foreign currency (EBITDAF) increased by 133% to US$58.9 million. As readers will see, that growth was quite a bit more than the operating revenue growth. The EBITDAF margin increased from 22% to 34% over the financial year.
Pushpay is expecting more operating leverage and growth in the future.
It's also pursuing growth in other areas.
The company said that it's investing between US$6 million to US$8 million in FY22 in the Catholic segment. It's focused on establishing relationships and increasing engagement with key stakeholders. Two thirds of that money will be spent on product design and development expense, with the rest spent on sales and marketing.
The ASX share has a goal of acquiring more than 25% of the Catholic church management system and donor management system market over the next five years.
Pushpay also pointed out that the Catholic church is closely associated with many education providers and non-profit organisations, which presents further opportunities within the US and other international jurisdictions.
Adore Beauty Group Ltd (ASX: ABY)
UBS is one of the brokers that likes Adore Beauty at the current share price. It has a price target on Adore Beauty of $5.60, which suggests a potential upside of around 20% over the next 12 months.
The broker points to growth themes and growing market share where the business can grow. Returning customers also helps things.
In May, the company announced its FY21 third quarter highlights, which included revenue growth of 47% to $39.4 million. Adore Beauty also reported "strong" retention and re-engagement rates for new customers acquired during the COVID-19 period. It also launched its loyalty program in March, with signups ahead of expectations.
The ASX share said it's on track to achieve FY21 revenue growth of between 43% to 47%.
Adore Beauty is seeing a structural shift in consumer behaviour towards online retail, based on continued strong retention of customer acquired during the COVID-19 lockdown.
The company is continuing to pursue disciplined investment to drive revenue growth and expand its online position. Its FY21 EBITDA will reflect the company's continued investment, including in marketing and advertising.
Adore Beauty is investing in things like its range, adjacency expansion opportunities and private label development.
