The four leading ASX growth shares in this article could be worth watching for the long-term.
Here are those interesting stocks:
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Pushpay Holdings Ltd (ASX: PPH)
Pushpay is a payments business which facilitates electronic donations, mostly to large and medium US churches.
Ben Griffiths from fund manager Eley Griffiths said: "Over the last 12 months it has become clear Pushpay is at an inflection point for both cashflow and earnings. Under the stewardship of CEO Bruce Gordon, Pushpay has transitioned from a founder-led investment phase into an optimize/monetization phase. What is more surprising is the very conservative nature of the accounts (a rarity in small cap tech, outside Iress Ltd (ASX: IRE). We believe the next few years for Pushpay will be rewarding and that COVID-19 will accelerate the already entrenched trend to digital giving/engagement from cash."
Pushpay recently reported in its FY21 half year result that its earnings before interest, tax, depreciation, amortisation and foreign currency (EBITDAF) margin increased from 17% to 31%. Pushpay expects "significant operating leverage to accrue as operating revenue continues to increase, while growth in total operating expenses remains low."
In FY21 the ASX growth share is guiding that it can deliver EBITDAF in the range of US$54 million to US$58 million, which would represent growth of more than 100%. Over the long-term it's aiming for annual revenue of US$1 billion as it gains market share.
At the current Pushpay share price it's valued at 25x FY23's estimated earnings.
Redbubble Ltd (ASX: RBL)
Redbubble is an online marketplace for products created by artists. It sells a wide array of items like wall art, phone cases, clothes and masks.
In FY20 Redbubble grew its marketplace revenue by 36% to $349 million and operating EBITDA surged 141% to $15.3 million. It generated $38 million of total free cashflow in FY20. During the locked-down fourth quarter of FY20, the ASX tech share's marketplace revenue grew 73%, gross profit rose 88% and it made $8.4 million of operating EBITDA.
The ASX share said growth in the first quarter of FY21 has continued strongly – marketplace revenue was up 116% to $147.5 million, gross profit grew 149% to $64.5 million, it made $22.1 million of earnings before interest and tax (EBIT) and Redbubble generated $27.1 million of operating cashflow.
VanEck Vectors Morningstar Wide Moat ETF (ASX: MOAT)
This is an exchange-traded fund (ETF) that invests in a diversified portfolio of attractively priced US companies with sustainable competitive advantages according to Morningstar's equity research team.
The ASX share has produced growth over the last five years with a total return of an average of 16% per annum. It has an annual management fee per annum of 0.49%.
At the moment the largest 10 holdings are: Applied Materials, Corteva, Charles Schwab, Microchip Technology, Boeing, Compass Minerals International, Aspen Technology, Yum! Brands, Cheniere Energy and American Express.
EML Payments Ltd (ASX: EML)
This ASX growth share has a number of different payment services for clients to use. EML Payments has general purpose reloadable offerings such as gaming payouts with white label gaming cards, salary packaging cards, commission payouts and rewards programs. EML Payments also offers physical gift cards, shopping centre gift cards and digital gift cards. Finally, it offers virtual account numbers.
EML Payments shares have gone up 51% since the start of November 2020, which is since the COVID-19 vaccine development news came out. Physical gift cards and shopping centre gift cards generated higher earnings before COVID-19 came along.
In the first quarter of FY21, EML revenue grew 75% to $40.6 million compared to the prior corresponding period and that was 20% higher than the fourth quarter of FY20. It generated $10 million of EBITDA in the first quarter, which was up 215% compared to the prior corresponding period and up 69% compared to the FY20 fourth quarter.
