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I think these are 3 of the best tech shares on the ASX

James Mickleboro
cloud, solutions, communications, technology, tech

I think that the local share market is home to a good number of quality tech shares that are worthy of a spot in most portfolios.

Three of my favourites are listed below. Here’s why I like them:

ELMO Software Ltd (ASX: ELO)

In FY 2017 this cloud-based talent management software solutions company smashed expectations with a full-year result well ahead of its prospectus forecasts. Pleasingly, this strong form has carried over into FY 2018. At the end of last month management advised that first-half cash receipts were up 39% on the prior corresponding period to $10.96 million. As a result, it has reaffirmed its FY 2018 guidance of SaaS revenue of $21.6 million and EBITDA of $2.7 million. If it delivers on this it will mean an impressive 125% increase on FY 2017’s EBITDA.

Nextdc Ltd (ASX: NXT)

I think NEXTDC would be a great investment option for investors willing to hold onto its shares for the long-term. There’s no doubt that demand for data storage is growing fast and I expect it to continue to do so for the foreseeable future as the shift to the cloud gathers pace. I think this puts NEXTDC and its high quality data centres in a great position to profit. While earnings growth may slow this year, it is worth remembering that this is due to costs related to the expansion of its network. I expect earnings growth will accelerate greatly in FY 2019.

Webjet Limited (ASX: WEB)

Due to the ever-increasing number of travel bookings being made online each year, I believe this leading online travel agent is well-positioned to deliver strong long-term earnings growth. The company recently advised that it aims to continue to grow its market share and is targeting annual business-to-consumer bookings growth of over 3x the market average and annual business-to-business bookings growth over 5x the market average over the next three years. I feel confident that Webjet will achieve this thanks to the shift to online booking and the strength of its brands and management team.

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Motley Fool contributor James Mickleboro owns shares of NEXTDC Limited. The Motley Fool Australia owns shares of and has recommended ELMOSFTWRE FPO. 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 Bruce Jackson.