The 3 best-performing ASX tech shares of 2022

One ASX tech share stood head and shoulders above the rest in 2022.

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It was a brutal year for ASX tech shares as concerns over soaring inflation and rising interest rates ran rampant in 2022.

The ASX tech sector felt the brunt of the impact, faring far worse than other sectors due to its sensitivity to interest rates.

The S&P/ASX 200 Index (ASX: XJO) slid 5.5% across the year to finish at 7,039 points. 

As I covered recently, the S&P/ASX 200 Health Care Index (ASX: XHJ) slightly lagged behind, dropping 8.4%.

But these falls pale in comparison to that of the ASX tech sector. The S&P/ASX All Technology Index (ASX: XTX), an index designed to be a comprehensive measure of technology-oriented companies on the ASX, suffered a painful 32.8% fall. 

As it stands, there are currently 47 companies in the ASX All Tech index. 

Of these, only 10 companies managed to outperform the ASX 200 index in 2022. You can see the performance of these shares in the table below.

Company2022 share price performance
Silex Systems Ltd (ASX: SLX)140.6%
Nearmap Ltd (ASX: NEA)35.9%
Computershare Limited (ASX: CPU)31.0%
Data#3 Limited (ASX: DTL)15.1%
Weebit Nano Ltd (ASX: WBT)13.6%
BrainChip Holdings Ltd (ASX: BRN)10.3%
ELMO Software Ltd (ASX: ELO)6.9%
TechnologyOne Ltd (ASX: TNE)2.6%
Pushpay Holdings Ltd (ASX: PPH)-1.6%
Hansen Technologies Limited (ASX: HSN)-3.9%

Let's take a closer look at the top three.

Fuelling up

In terms of annual share price performance, there was daylight between Silex and the rest of its ASX All Tech peers in 2022.

The Silex share price soared to lofty heights, propelled by a resurgence in nuclear energy during the year. 

There's been a growing acceptance that nuclear energy will be a key pillar in the fight against climate change. What's more, Russia's invasion of Ukraine has added another catalyst to the mix as energy markets have gone into a tailspin.

So how does Silex fit into this? Well, it's a company focused on commercialising its laser technology to enrich uranium, the fuel most widely used to produce nuclear energy.

The company believes it has the only third-generation laser-based uranium enrichment technology that is currently under commercial development.

According to Silex, uranium production and enrichment are the two largest value drivers of the nuclear fuel cycle, accounting for nearly 80% of the value of a reactor fuel bundle.

In August, Silex announced it had successfully completed extensive testing of its first full-scale laser system module. The company is aiming to complete the pilot demonstration program by 2025.

It's also trying to commercialise its technology for silicon enrichment, which is currently in stage three testing.

Gliding off the ASX

After first joining the ASX ranks in 2008, Nearmap's publicly-listed life reached the end of the road in 2022.

In August, software investment firm Thoma Bravo launched a takeover bid, proposing to acquire the aerial imagery company for $2.10 per share. At the time, this represented a 39% premium to Nearmap's last closing price of $1.51.

Around 78% of shareholders voted in favour of the deal; enough to narrowly satisfy the 75% hurdle. After receiving all the ticks of approval, the takeover went through and Nearmap was delisted from the ASX last month.

Cashing in on higher interest rates

Last but not least, Computershare took out the bronze medal as the third best-performing company in the ASX All Tech index in 2022.

The Computershare share price defied the tech downturn, finishing the year 31% higher than where it started.

This is because Computershare is in a unique position of benefitting from higher interest rates, in a big way at that. 

Computershare's core operations require it to hold large amounts of cash on behalf of its clients. For example, the cash for dividends before it's divvied out to shareholders.

In FY22, total client balances averaged roughly US$34 billion. Computershare earns interest income – also known as margin income – on these balances, which effectively falls straight to the bottom line.

This income came in at US$187 million in FY22, reflecting a yield of 0.56% which was steady year on year. But on the back of recent interest rate hikes, FY23 is where the benefits will start to kick into gear.

The company was initially expecting its FY23 margin income to land at around US$520 million, representing growth of nearly 180%. 

But in November, on the back of global interest rate rises being faster and larger than expected, Computershare cranked up this guidance to a mighty US$800 million. The company is expecting to earn an average weighted yield of 2.19%.

While it's still early days, as it stands, Computershare is forecasting its margin income in FY24 to reach the US$1 billion mark.

Motley Fool contributor Cathryn Goh has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has positions in and has recommended Elmo Software, Hansen Technologies, and Pushpay. The Motley Fool Australia has positions in and has recommended Pushpay. The Motley Fool Australia has recommended Technology One. 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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