Are you looking for ASX tech shares to buy? Well, if you are, you might want to read on!
That's because listed below are two ASX tech shares that have recently been named as buys. Here's what you need to know about them:
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Objective Corporation Limited (ASX: OCL)
Goldman Sachs has tipped Objective Corp as an ASX tech share to buy.
The broker believes the public sector software provider is well-placed for growth in the coming years. This is due to its belief that demand will remain strong for its software thanks to the defensive nature of the sector.
In fact, Goldman expects demand to remain so strong that it is forecasting earnings per share growth above 20% in both FY 2024 and FY 2025. 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.
Xero Limited (ASX: XRO)
Another ASX tech share that has been named as a buy is Xero.
It is of course a leading platform provider for online accounting and business services to small businesses across the globe.
Citi has been very pleased with Xero's performance in recent years and believes it is well-placed to build on this in the future. The broker recently commented:
We see Xero's focus (under the new CEO) on efficient growth as a step in the right direction. We upgrade our EBITDA forecasts by +7% to +8%, increase target price by +14% to $120, maintain our Buy rating, and see upside risk to consensus forecasts if Xero is able to deliver on 'Rule of 40'. We see FY24e as a year of re-basing and reassessing strategy. We also see delivery of 20%+ revenue growth while meeting the 'Rule of 40' threshold (something Xero has not done to date) as key for a further re-rate.
Citi currently has a buy rating and $120.00 price target on Xero's shares.
