The Australian tech sector is small and immature when compared to the much larger United States tech market. However, a broad range of exciting ASX tech shares is now emerging. Some have a fast growing international presence.
Here, we look at two ASX tech shares I believe would make worthy additions to your ASX share portfolio.
Image source: Getty Images
2 ASX tech shares to buy and hold
Nearmap Ltd (ASX: NEA)
Nearmap is an Australian aerial imagery and location data company. It provides geospatial map technology for businesses and government customers across Australia, New Zealand, the US, and Canada.
The Nearmap share price was hit harshly during late January and during the early phase of the coronavirus pandemic. It fell from $2.71`in mid January to 86 cents in late March. That's a massive decline of 68%. The Nearmap share price has, however, risen fairly strongly since then, helped by two positive business updates during April and May. In late May, Nearmap revealed that its customer base has been growing strongly over the prior few months. Also, average subscription revenue continues to climb higher, which is lifting Nearmap's operating margins.
I believe that this ASX tech share is well placed for strong growth over the next five years, driven in particular by its US operations.
Bigtincan Holdings Ltd (ASX: BTH)
Bigtincan operates in a fast-growing niche in the IT software market that is known as 'sales enablement'. Organisations and their sales teams are provided with a platform to customise and collaborate on content and improve customer engagement. Bigtincan's customers are located in over 50 countries. It operates in diverse industries and market segments. An aspect of its product that I find particularly appealing is that it leverages artificial intelligence through features such as the ability for users to personalise and recommend content.
Despite a temporary decline during the early phase of the coronavirus pandemic, the Bigtincan share price has risen very strongly from 27 cents in late March to now be trading at 92 cents. That's an increase of over 240%.
Although Bigtincan is yet to achieve profitability, I believe it is well placed to achieve this goal over the next few years. Its customer base is growing quickly. Also, it operates under a software-as-a-service (SaaS) business model that is highly scaleable. Therefore, the addition of each new customer improves the company's overall operating margin.
Foolish takeaway
Nearmap and Bigtincan are two small-cap ASX tech shares that are in my buy zone right now. I believe both have strong growth potential over the next five years, driven by expanding international markets.
