I've got my eyes on a few S&P/ASX 200 Index (ASX: XJO) shares that have strong growth prospects. Businesses that are compounding revenue and earnings at a fast pace have a great chance of delivering pleasing shareholder returns for investors.
Some ASX growth shares are certainly priced for a lot of future growth, such as Pro Medicus Ltd (ASX: PME) and WiseTech Global Ltd (ASX: WTC).
There are other names that I think have great growth potential but aren't trading on as high of a price/earnings (P/E) ratio. Let's get into these exciting names.
Premier Investments Ltd (ASX: PMV)
There are three elements of the Premier Investments business – nightwear retailer Peter Alexander, school accessories retailer Smiggle and a minority stake in Breville Group Ltd (ASX: BRG).
I think Peter Alexander is a compelling business which has grown sales significantly over the last several years and it still has impressive growth plans.
In the FY25 half-year result, the business said it had confirmed two new stores and four relocations/expansions for Peter Alexander into larger formats for the second half of FY25 across Australia and New Zealand. More than 15 further opportunities had been identified for new and/or larger format stores in ANZ in the near-term.
Even more excitingly, in the first half of FY25, Peter Alexander launched in the UK, with the first three stores being in prime London shopping centres.
Smiggle has a presence in over 20 countries. It is exploring future offshore markets as both owned stores and the wholesale channel (through store-in-store and standalone stores). The business also reported "improving sales momentum" early in 2025.
I'm also excited about what Breville can achieve, with a good chance of delivering net profit growth and providing higher dividends to the ASX 200 share.
TechnologyOne Ltd (ASX: TNE)
This company provides software to more than 1,300 businesses, government agencies, local councils and universities. Its goal is to provide a global software as a service (SaaS) enterprise resource planning (ERP) solution that makes life simple for customers.
It has blue-chip customers which aren't likely to abandon using software, even during a recession. The ASX 200 share invests significantly in research and development to ensure that its offering is the best it can be, enabling it to attract and retain subscribers, while also unlocking more revenue for the company.
The company has a net revenue retention (NRR) target of 115%, meaning its existing customers pay 15% more revenue each year. At that pace, the company's revenue doubles in five years. In the HY25 result, it reported NRR of 118%, which is even stronger than management anticipated.
The business is also aiming for $1 billion of annual recurring revenue (ARR) by FY30, up from $511.1 million in the first half of FY25. The ASX 200 share is also expecting economics of scale with its software to help its profit before tax margin reach at least 35% in the long-term.
With how defensive its earnings are, plus the growth it's delivering, I think this company has a very strong outlook.
