Are you looking to add some growth shares to your portfolio in 2023?
If you are, two explosive ASX growth shares that could be worth considering are listed below. Here's what you need to know about them:
Aristocrat Leisure Limited (ASX: ALL)
Morgans believes that this gaming technology company is a growth share to buy right now. Its analysts have an add rating and $43.00 price target on its shares. This compares to the current Aristocrat share price of $34.01.
The broker is a fan of the company due to its strong long term growth potential. This is being driven by a number of factors including its ability to invest in design and development and its expansion in real money gaming (RMG). Morgans commented:
We have three key reasons for being positive on ALL. They are: (1) long-term organic growth potential. ALL is better capitalised than many of its competitors and has what we regard as a strong platform to continue investment in design and development in both its land-based gaming and digital businesses; (2) strong cash conversion and ROCE. ALL is a capital-light business despite its ongoing investment in Gaming Operations capex and working capital. It has a high level of cash conversion and ROCE and (3) strong platform for investment. ALL has funding capacity for organic and inorganic investment in online RMG, even after the recent buyback. Its current available liquidity is $3.8bn.
Temple & Webster Group Ltd (ASX: TPW)
Goldman Sachs is a big fan of this online furniture and homewares retailer and has a buy rating and $7.55 price target on its shares. This compares favourably to the latest Temple & Webster share price of $4.55.
Goldman believes that Temple & Webster is well-placed for long term growth thanks to its leadership position in a retail category that is in the early stages of shifting online. It commented:
Our Buy thesis is predicated on the following key drivers: (1) we believe TPW is well positioned in the upcoming cycle to continue to grow market share, despite a weaker macro environment; (2) in our view TPW is best placed to be a winner in a category that favours scale players, requires a specialised approach to e-commerce, and has higher barriers to entry vs. other retail categories; and (3) greater focus on costs is a sensible strategy to balance near-term profitability with growth.
