The S&P/ASX 200 Index (ASX: XJO) has slumped lower in March, but some of the ASX tech shares have bounced back strongly. The current bear market could provide some good value buys, but which of the WAAAX group are in the buy zone?
Afterpay Ltd (ASX: APT)
Despite bouncing back 53.54% last week, I still think the Afterpay share price has further to go. Shares in the buy now, pay later group plummeted from $41.14 to $8.01 in the space of a few weeks. That bargain wasn't going to last long, however, and investors pushed the ASX 200 share back up to $19.10 by Friday.
Fears over coronavirus crisis were what sparked the Afterpay share price crash and it's still down 42.42% in March (at the time of writing). But from what I've seen, the government restrictions may not impact the group too heavily – retailers are shutting their doors but keeping their online stores while consumers might want to space out their expenditure as times get tough.
Altium Limited (ASX: ALU)
Altium is one of those ASX 200 tech shares that could provide PC-based design software for engineers who create printed circuit boards. The Altium share price has been on fire in recent years and is down just 15.58% since the start of March. That could be a bargain given Altium shares were trading as high as $42.76 prior to the recent crash.
If you're looking for ASX 200 tech shares to buy, Altium might be undervalued at $26.00 per share.
Xero Limited (ASX: XRO)
Xero is arguably the best ASX 200 tech share to buy right now. Unlike many of the other WAAAX shares, the Xero share price wasn't smashed in February and March. After gaining 5.59% last week, the Xero share price is down just 11.47% in March. Compared to the benchmark index, that's a relative outperformance of 13.35%.
By my calculations, the ASX 200 tech share has a 0.45 correlation with the index over the last 12 months. That could be a coincidence or could represent good defensive qualities. Despite the shutdown, companies still need to do their books and that requires accounting software. I would expect to see Xero's earnings stay relatively stable, even if we see a short-term decline.
Xero's half-year results showed a strong balance sheet, with cash and short-term deposits making up 47% of total assets. I think that could leave the ASX 200 tech share well-placed to weather any storm from COVID-19.
