If you're looking for long term options, then the tech sector could be a good place for investors to look. This is because the sector is home to a number of companies that have the potential to grow strongly over the next decade.
Two ASX tech shares that are highly rated are named below. Here's why analysts rate them as buys:
Adore Beauty Group Limited (ASX: ABY)
The first ASX tech share to look at is Adore Beauty. Australia's leading online beauty retailer has been growing strongly in recent years thanks to the structural shift online which accelerated during the pandemic. This is expected to underpin a 43% to 47% increase in full year revenue in FY 2021.
The good news is that with online penetration rates for beauty products still much lower than other categories and in comparison to other Western markets, Adore Beauty appears very well-positioned to continue its growth over the next decade. Particularly given its leadership position in the growing market.
UBS is a fan of Adore Beauty. Its analysts currently have a buy rating and $5.60 price target on the company's shares. UBS believes the company will benefit from structural tailwinds in the coming years.
NEXTDC Ltd (ASX: NXT)
Another ASX tech share to look at is NEXTDC. It also appears well-placed for growth over the long term. This is thanks to the cloud computing boom and NEXTDC's position as one of the region's leading data centre-as-a-service providers.
At present, the company has 11 world class centres in key locations across Australia that are experiencing insatiable demand for capacity. In light of this, it has just announced plans to build a fourth centre in Sydney.
Furthermore, it has plans to expand into the Asian market. If NEXTDC can replicate its Australian success internationally, then it could provide it with a very long runway for growth over the 2020s and beyond.
UBS is also positive on NEXTDC. Last week the broker put a buy rating and $15.40 price target on its shares.
