If you have room in your portfolio for some new ASX tech shares in November, then it could be worth checking out the two listed below.
They have recently been named as buys by brokers and tipped to rise strongly. Here's why they could be great buy and hold investment options:
Megaport Ltd (ASX: MP1)
The first ASX tech share to look at is Megaport. It is a leading global provider of elastic interconnection services that Morgans rates highly. The broker currently has an add rating and $12.50 price target on its shares.
Megaport has grown very strongly in recent years thanks largely to its exposure to the ongoing shift to the cloud, which has been accelerating recently due to the artificial intelligence (AI) megatrend.
Morgans believes this strong form can continue and is forecasting strong earnings growth over the coming years. It said:
Megaport is a global cloud connection network and the leading Network as a Service provider. It operates the largest data centre connection business in the world, connecting to 850 data centres through a fully automated, on-demand telco network. We think it is uniquely placed to help business move data globally and benefit from the growth of data related to both cloud computing and AI.
Readytech Holdings Ltd (ASX: RDY)
The team at Goldman Sachs thinks that Readytech could be an ASX tech share to buy this month. It has a buy rating and $4.25 price target on its shares.
Readytech owns a portfolio of enterprise software businesses across several market verticals such as higher education and local government.
The broker rates Readytech highly due to its growing levels of recurring revenue and low churn levels. In addition, it highlights that its defensive public sector end-markets and mission critical software solutions should protect its earnings in the event of an economic slowdown.
So, with its shares trading at a sharp discount to peers, Goldman believes this could be a great time to invest. It explains:
Further to its defensiveness, we believe the market has given RDY little credit for improving its organic profile since listing while the company has maintained solid margins and cash flow. In our view, RDY will continue to grow mid-teens organically, underpinned by solid software metrics such as low churn at ~3% and high LTV/CAC. RDY trades at a large discount to ASX tech peers, both on an absolute and growth-adjusted basis, which we believe is too wide considering RDY's business quality and growth outlook.
