There are great ASX growth shares for investors to choose from on the stock market. Some names with international potential are particularly compelling because of how much stronger that makes their potential growth. In this article, I'm going to talk about the ASX shares that I'd buy with $10,000.
In fact, I recently invested in two of them for my own portfolio so, be assured, I've backed the stocks I'm about to outline with my own money.
Volpara Health Technologies Ltd (ASX: VHT)
Volpara is an ASX healthcare share that provides software used in breast screening for cancer. After screening, it also analyses the images, provides risk analysis for patients, and includes software for healthcare professionals to work more efficiently.
The company has a great product which is resonating with customers. More than a third of US women who have a breast screen have at least one of Volpara's software modules used on their images.
Revenue and profitability are increasing at very strong rates. In the FY24 first half, the company saw revenue rise by 17% to NZ$19.8 million, while the normalised earnings before interest, tax, depreciation and amortisation (EBITDA) improved 68% to a loss of NZ$1.4 million.
Despite that loss, the company is in a cash flow positive position, which is a significantly positive step. Its high gross profit margin of 91.6% suggests most of the new revenue it generates can turn into gross profit. Certainly, scaling is very beneficial for the company.
In five years, I think this ASX share could be a much more profitable company.
Temple & Webster Group Ltd (ASX: TPW)
Temple & Webster is an online-only retailer of homewares and furniture. It has the goal of being the number one player in the space compared to both traditional retail and online competitors.
In the first few weeks of FY24, it registered revenue growth of 16%. This is an impressive rate considering the economic challenges plenty of households are facing.
I like that the company is trying to expand into both home improvement products and with commercial customers because these are both large categories that a digital retailer could do well by disrupting.
Over the long term, I believe more people are going to shop online more often. It helps that the most digital-savvy generations are entering the workforce and approaching the higher-spending ages.
As the company scales, the ASX share is expecting to grow margins. Growth can help lower its fixed costs as a percentage of revenue, but it's also investing in areas that can help margins such as an AI-powered chatbot. It's also working on an AI interior design service.
In five years, I think the business will be generating much more annual revenue – it's aiming for at least $1 billion of annual sales in three to five years.
Johns Lyng Group Ltd (ASX: JLG)
This company specialises in providing repairs and restoration services after properties and contents are damaged by insured events including impact, weather, and fire events. Its core markets are Australia and the US, though it has recently expanded into New Zealand as well.
Its client base includes major insurance companies, commercial enterprises, local and state governments, body corporates and owners' corporations, and retail customers.
The ASX share is significantly expanding in the catastrophe recovery industry. This division saw revenue growth of 125.3% to $371.3 million.
Its strata services division is promising because, as management has said, there is "immense opportunity for both cross-selling and restoration works and consolidation within the highly fragmented sector". Acquisitions could significantly increase its scale here. Its market share is currently less than 4%.
Plus, it has another growth avenue called "essential home services" after the acquisitions of Smoke Alarms Australia and Lifefire Services. There are an increasing number of regulatory mandates of "essential prevention and monitoring services" delivered by "reputable and registered service providers", according to the company.
The essential home services and strata services offer the company growth and defensive potential.