With the tech sector rebounding this month, now could be a good time to add some exposure to your portfolio if you don't already have any.
Two ASX tech shares that have recently been named as buys by Goldman Sachs are listed below. Here's why they could be top options:
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Nextdc Ltd (ASX: NXT)
The first ASX tech share that Goldman is bullish on is data centre operator NextDC.
Its analysts believe the company is well-placed to benefit from the rapid growth in cloud adoption, which is underpinning significant demand from both public and private markets. It commented:
NextDC is an Australian based Data Centre operator. We are particularly positive on NXT and are Buy rated given the rapid growth in cloud adoption, which has been supported by the continued evolution of the enterprise telecommunications market, and the significant demand by both public and private investors for digital infrastructure assets. We believe the company has a compelling growth profile and a proven and profitable business model, noting it trades on a growth-adjusted discount vs. peers, which we view as unjustified.
The broker has a buy rating and $14.96 price target on NextDC's shares.
Objective Corporation Limited (ASX: OCL)
Goldman Sachs has also named Objective Corp as an ASX tech share to buy.
The broker believes the public sector software provider is well-positioned to deliver strong growth in the coming years thanks to its defensive earnings and growing demand. It said:
In our view OCL is well placed to deliver robust and defensive earnings growth driven by (1) R&D and new product cycles accelerating the contribution from newer products including Nexus, Build and RegWorks; (2) cycling of revenue/earnings headwinds from model transition away from perpetual / services revenue and towards subscriptions; and (3) cost management into FY24, with +350/+250bps margin expansion driving +23%/+32% FY24/25 EPS growth when comping trough FY23E earnings.
Goldman has a buy rating and $14.90 price target on Objective Corp's shares.
