The S&P/ASX 200 Index (ASX: XJO) is, for better or for worse, dominated by the big banks and giant mining companies.
In fact, according to the creator of the ASX 200, the finance (27.1%) and materials (25.6%) sectors combined take up the majority index weight.
This means that the Australian market is skewed towards dividend stocks.
The trouble with ASX dividend shares is that, generally, they don't have as much potential for capital growth as other equities.
The logic is that, if the business was expanding at a rapid rate, management would not be giving excess cash back to investors. The company would, instead, put the money back into the business to fuel growth.
Following in the footsteps of giants
Betashares manager Libby Hopper recently said that, while they may not attract as much attention as the banks and miners, there are actually plenty of ASX 200 growth shares to choose from.
They come from varied fields, such as healthcare, retail and technology.
"Australia boasts a number of under the radar success[es]… including Pro Medicus Limited (ASX: PME), Lovisa Holdings Ltd (ASX: LOV) and Altium Limited (ASX: ALU)," Hopper said on the Betashares blog.
She reckons Pro Medicus is following in the footsteps of CSL Limited (ASX: CSL) and Cochlear Limited (ASX: COH) as "an Australian healthcare success story".
"In its 2022 annual report, Pro Medicus' after tax profits and revenue jumped more than 44% and 37% respectively compared to the previous period," said Hopper.
"Looking ahead, the company expects adoption of its technologies to increase – particularly as the use of artificial intelligence in the industry accelerates."
International expansion and technology themes
The Lovisa share price has more than doubled since June last year, which is incredible enough, but even more so considering the market has remained depressed in that time.
It seems like another lifetime ago when the jewellery retailer was forced to shut stores due to the COVID-19 pandemic.
"Since then the business has seen year on year revenue growth – increasing almost 60% in 2022 to more than $458 million," said Hopper.
"Lovisa's success to date has left it with a healthy balance sheet which it is using to continue its international expansion and better its digital platforms."
Altium, as a maker of software for designing printed circuit boards, cashes in on from multiple global themes in technology.
"Altium stands to benefit from increased advancements in and adoption of key technologies such as robotics, artificial intelligence as well as electric and autonomous vehicles," said Hopper.
"Altium has subsequently reaffirmed its guidance for the 2023 financial year, with total revenue anticipated to rise between 15% to 20% to approximately US$255 to 265 million."
