There has been a lot of damage done to a wide range of ASX shares. But, 2023 could be the year that some names surge higher if things go well.
ASX shares that are hoping to grow substantially in the coming years could get some traction next year.
Of course, just because a business is growing doesn't necessarily mean that investors are going to recognise that potential within a 12-month time period, but I think underlying growth of the ASX share can indicate good things for the potential shareholder returns. That's why I've got my eyes on these three ideas:
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Healthia Ltd (ASX: HLA)
Healthia is a small-cap ASX share with over 300 clinics. This healthcare share has three segments that are aimed at helping people across 'bodies and minds', 'feet and ankles' and 'eyes and ears'.
I think that, over time, scale can greatly add to this business' profitability as it grows the number of clinics through acquisitions and organic growth.
If the business can execute a steady pipeline of bolt-on acquisitions, it will naturally become a larger business over time.
The business already has a small presence in markets outside of Australia, in New Zealand and the USA, which gives it a longer growth runway.
According to Commsec, the business is valued at just 10 times FY23's estimated earnings with a potential grossed-up dividend yield of 5.7%.
Monash IVF Group Ltd (ASX: MVF)
This ASX share is about providing IVF services to help families have children. The company says that the maternal birth age has increased by two years over the last 20 years and is expected to further increase.
The IVF industry saw a 5% compound annual growth rate (CAGR) of volume between FY17 to FY22. After a disrupted period of COVID, 2023 could be a good year. It managed to slightly increase its market share in FY22.
It's gaining "momentum" in south east Asia with five IVF clinics across the region. It is planning to open two or three new clinics each year. By FY26, Asia could be contributing 25% of the group's stimulated cycles.
FY23 has started strongly – market share was up another 1.4% to 23.8%. According to Commsec numbers, it's priced at under 16 times FY23's estimated earnings.
Volpara Health Technologies Ltd (ASX: VHT)
Volpara is a leading provider of software relating to screening for breast cancer and lung cancer.
It has built an impressive market share in the US. Of the women that are screened for breast cancer, at least one of Volpara's products is used on 40.5% of women's images.
The ASX share has an impressive gross profit of more than 90%, so extra revenue can help it power towards profitability. Its FY23 first-half result showed total revenue growth of 22% in constant currency terms.
I think a big step towards breakeven in 2023 will go some distance to quell investor concerns about potentially needing to do a capital raising.
Growth of average revenue per user (ARPU), geographic expansion and large client wins could be good tailwinds for the Volpara share price next year.
The US Food and Drug Administration (FDA) is expected to release breast density legislation, which could also be a boost for Volpara if it means more dialogue with patients about cancer risk.
