Analysts rate these ASX growth shares as buys in May

These growth shares could be buys in May…

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Looking for growth shares to buy in May? Well, here’s some good news! Listed below are two growth shares that have recently been named as buys with major upside potential.

Here’s what you need to know about them:

Allkem Limited (ASX: AKE)

Allkem could be a growth share to buy in May. It is the top five global lithium mining company that was created with the merger of Galaxy Resources and Orocobre.

The company owns a collection of high-quality assets including Olaroz, Mt Cattlin, and the Sal de Vida brine project. This gives Allkem geographic diversity and also lithium type diversity.

Unlike the many explorers on the Australian share market that are some way off producing lithium, Allkem is already shipping it in large quantities. This is allowing the company to benefit from the sky high lithium prices being underpinned by the clean energy transition and the rapid adoption of electric vehicles.

Morgans is a big fan of Allkem and has an add rating and $16.98 price target on its shares. Based on the current Allkem share price, this implies potential upside of over 40%.

Xero Limited (ASX: XRO)

Another ASX growth share that has been tipped as a buy is Xero.

It is a leading cloud-based business and accounting software provider which had over 3 million subscribers globally at the last count.

As you may have noticed in 2022, tech shares are not performing very positively. And Xero is certainly no exception, with its shares down 38% since the start of the year.

While this is disappointing, it could be a buying opportunity for long term focused investors. In fact, Goldman Sachs believes Xero is a “compelling global growth story” and has recently reiterated its buy rating on its shares with a $133.00 price target.

Based on the current Xero share price, this implies potential upside of almost 48%.

Motley Fool contributor James Mickleboro has positions in Allkem Limited. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has positions in and has recommended Xero. The Motley Fool Australia has positions in and has recommended Xero. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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