The tech sector has been having a tough couple of months. While this is disappointing, it may have created a few buying opportunities for long term focused investors.
For example, the two buy-rated ASX tech shares listed below are trading significantly lower than their 52-week highs. Here's what you need to know about them:
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Megaport Ltd (ASX: MP1)
Megaport is the global leading provider of elastic interconnection services. Using software defined networking (SDN), its global platform allows customers to rapidly connect their network to other services across its network. These services can be directly controlled by customers via mobile devices, their computer, or its open API.
The Megaport share price is currently trading at $18.41, down 16% from its 52-week high. Citi appears to see this as a buying opportunity and has recently put a buy rating and $21.30 price target on its shares.
Citi commented: "The key positive from Megaport's 1Q update was the solid growth in MRR, with 1Q22 being a record in terms of MRR added. […] We remain Buy-rated as we expect strong growth going forward reflecting structural tailwinds as well as the partner channel kicking in from 2Q22e onwards (both MVE as well as PartnerVantage)," it added.
Nitro Software Ltd (ASX: NTO)
The Nitro share price could be an even bigger bargain if the team at Bell Potter is on the money. Its analysts have a buy rating and $4.50 price target on the growing global document productivity software company's shares. This implies more than 100% upside based on the current Nitro share price of $2.13.
Bell Potter is a big fan of the company's Nitro Productivity Platform and believes it has a huge market opportunity to grow into. This has been further boosted by the recent acquisition of Connective NV, which it described as a "game-changer".
The broker commented: "Nitro announced it has entered into a binding agreement to acquire Connective NV for an EV of €70m (~US$81m). Connective is Belgium's leading eSign SaaS business with fast growing market share in France and customers in 11 other European countries."
"The rationale for the acquisition is it will accelerate and enhance Nitro's eSign, eID (electronic identity) and document workflow capabilities. It will also position Nitro to become the third global player in the enterprise eSign market along with DocuSign and Adobe," it added.
