If you’re wanting to add some growth shares to your portfolio in September, then you may want to check out the two listed below.
Here’s why analysts are tipping these ASX shares as buys:
IDP Education Ltd (ASX: IEL)
The first ASX growth share to look at is IDP Education. It is a provider of international student placement and English language testing services.
While trading conditions have been difficult because of the pandemic, the company appears well-positioned for growth once trading conditions normalise. Particularly given its recent acquisition of the British Council’s Indian International English Language Testing System for A$240 million. This transaction is expected to be approximately 13% earnings per share accretive (pre-synergies) on a pro forma calendar year 2019 basis.
Goldman Sachs is very positive on the company and believes it has strong long term growth potential.
It commented: “The long term growth opportunity for IEL is compelling. The company is reinvesting in digital capability that will increase its competitive advantage and strengthen its relationship with tertiary education institution clients. We estimate IEL to have <5% market share of the Canada and UK markets, with significant opportunity to gain share in a highly fragmented and under-penetrated market.”
The broker currently has a buy rating and $34.00 price target on its shares.
Nitro Software Ltd (ASX: NTO)
Another ASX growth share to look at is Nitro Software. It is a software company that is aiming to drive digital transformation in organisations around the world via its Nitro Productivity Suite. This product provides integrated PDF productivity and electronic signature tools to customers.
Demand for its offering continues to grow thanks to its quality and a number of positive industry tailwinds. This includes the global shift to remote and digital work, which is being accelerated by the pandemic.
During the first half of FY 2021, the company delivered a 56% increase in its annualised recurring revenue (ARR) to US$33.8 million. This puts it on track to achieve its FY 2021 guidance for ARR of between US$39 million and US$42 million.
Bell Potter is very positive on the company. It is the broker’s “number one pick given the slight pullback in share price following the 1H2021 result – which was good but not great – and our expectation the next few results (i.e. 2H2021, 1H2022 and 2H2022) will all show strong top line growth on the back of the increase in sales staff in 1H2021 and also the recent commencement of charging for eSigning.”
Bell Potter has a buy rating and $4.00 price target on its shares.