I believe that Australian investors are spoilt for choice when it comes to growth shares. But with so many high quality and fast-growing shares, it can be hard to decide where to invest.
To give investors a hand, I thought I would pick out five fast-growing companies which I believe could be great investments in December.
Here’s why I would buy these shares:
Altium Limited (ASX: ALU)
Altium is a printed circuit board (PCB) design software company which I believe could provide strong returns over the next decade thanks to its industry-leading software and its exposure to the rapidly growing Internet of Things market. In addition to this, its fledgling Octopart business has a lot of potential and should complement the growth of its core business. Management is very confident on its future. Earlier this year it revealed that it is aiming to grow its revenue to US$500 million by FY 2025. This compares to FY 2019’s revenue of US$171.8 million.
Appen Ltd (ASX: APX)
Appen is a leading provider of high-quality language data and services. It provides its services to major technology companies such as Facebook and Microsoft, and automakers and governments. Demand has been strong for its services again in FY 2019, leading to Appen upgrading its guidance this month. It now expects underlying EBITDA to be in the range of $96 million to $99 million, which implies year on year growth of 34.6% to 38.8%. Due to favourable tailwinds and its leadership position, I believe it can continue this strong form long into the future.
Nearmap Ltd (ASX: NEA)
Nearmap is a leading aerial imagery technology and location data company. It has been growing at a very strong rate over the last few years thanks to increasing demand for its offering in Australia and North America. This month it provided a trading update at its AGM and guided to further strong annualised contract value (ACV) growth in FY 2020. Nearmap expects group ACV in the range of $116 million to $120 million. This represents growth of 28.6% to 33% on FY 2019’s ACV of $90.2 million.
Webjet Limited (ASX: WEB)
Webjet is an online travel booking company which I think growth investors ought to consider buying in December. It has been an impressive performer over the last decade thanks to the shift to online booking, acquisitions, and the growing popularity of its numerous brands. I expect more of the same over the next decade, driving further strong returns for investors. It held its AGM this month and revealed that it expects more strong earnings growth in FY 2020.
Xero Limited (ASX: XRO)
Xero is a leading cloud-based business and accounting software provider. It has caught the eye of investors in recent years thanks to its explosive sales and customer growth. It also enjoys a sky high retention rate, which I believe demonstrates both the quality and stickiness of its platform. It recently reported its half year results and revealed a 32% increase in operating revenue to NZ$338.7 million and a 30% jump in its annualised monthly recurring revenue to NZ$764.1 million. I believe it is well-placed for similarly strong growth in the coming years.
The post 5 explosive ASX growth shares to buy in December appeared first on Motley Fool Australia.
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Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of and has recommended Nearmap Ltd. The Motley Fool Australia owns shares of Altium, Appen Ltd, and Xero. The Motley Fool Australia has recommended Webjet Ltd. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.
The Motley Fool's purpose is to help the world invest, better. Click here now for your free subscription to Take Stock, The Motley Fool's free investing newsletter. Packed with stock ideas and investing advice, it is essential reading for anyone looking to build and grow their wealth in the years ahead. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson. 2019