2 top ASX tech shares to buy that are growing rapidly

There are 2 top ASX tech shares that are growing rapidly which could be a buy, including Kogan.com Ltd (ASX:KGN) and Redbubble Ltd (ASX:RBL).

| More on:
small lights in the form of waves representing swell of asx tech shares

Image source: Getty Images

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

There are some top ASX tech shares that are growing rapidly and could be worth looking into.

Here they are:

Redbubble Ltd (ASX: RBL)

Redbubble is an e-commerce business focused on selling artist-produced products like masks, stationery, wall art, phone cases and masks. It operates two websites: Redbubble.com and TeePublic.com

The Redbubble share price has fallen 7.5% since 13 January 2021, but it is still reporting high levels of growth.

The high-growth ASX tech share said in its FY21 trading update for the first quarter showed normalised marketplace revenue growth of 98% to $139.3 million, gross profit rose by 118% to $59.6 million and the earnings before interest and tax (EBIT) generation amounted to $17.2 million.

Joseph Kim from Montgomery Investment Management said: "While Redbubble has clearly been a "stay-at-home" trade, we believe the business has the opportunity to emerge a longer-term structural winner from COVID-19 should it capitalise in the recent spike in user and customer interest as a result of recent lockdown measures."

Redbubble CEO Martin Hosking is very optimistic about the long-term future of the company. He said: "The strategic priority for the group now is to ensure we extend the market leadership we have established. We intend to invest in the customer experience to improve loyalty and retention and ensure long-term higher levels of growth. The company has the resources to undertake the anticipated investments and margin structure to ensure it can do so while remaining profitable."

Redbubble is focused on four key initiatives. The first is artist acquisition, activation and retention. Second, Redbubble is focused on user acquisition and transaction optimisation. The third focus is customer understanding, loyalty and brand building. Finally, further physical product and fulfilment network expansion is the last focus.

Kogan.com Ltd (ASX: KGN)

Kogan.com is another e-commerce ASX tech share. It sells a large selection of products on its website including TVs, phones, computers, cameras, furniture, clothing, cars, insurance, travel, energy, internet and mobile services.

The company has been reporting continued growth in FY21, following on from FY20's growth. FY20 saw gross sales go up 39.3% to $768.9 million, adjusted earnings before interest, tax, depreciation and amortisation (EBITDA) grew 57.6% to $49.7 million and earnings per share (EPS) went up 61.1%.

In the first four months of FY21, to the end of October, Kogan.com saw 99.8% growth of gross sales, 131.7% growth of gross profit and 268.8% growth of adjusted EBITDA. It saw strong performance from its product divisions and Kogan Marketplace. Active customers grew 61.4% year on year to 2.68 million.

Over the past four years the ASX tech share boasts of rising margins whilst investing into its platform, products and services. The EBITDA margin was 4.3% in FY17, but it had grown to 9.3% in FY20.

Mr Kogan, the founder of the company, has spoken about the benefit to the company of its growing number of people using its loyalty scheme: "The Kogan First community of members grew exceptionally during the second half, and importantly these loyal members on average purchase and save much more often than non-members, demonstrating loyalty to the platform, and also demonstrating the significant savings and other benefits available through the loyalty program."

The ASX tech share also recently announced the acquisition of New Zealand online retailer Mighty Ape, which is a leader in gaming, toys and other entertainment categories.

In FY20, Mighty Ape is expecting to make $137.7 million of revenue, gross profit of $45.7 million and EBITDA of $14.3 million, representing year on year growth of 43.7%, 58.1% and 254.1% respectively.

At the current Kogan.com share price it's valued at 28x FY23's estimated earnings.

Should you invest $1,000 in Betashares Global Cybersecurity Etf right now?

Before you buy Betashares Global Cybersecurity Etf shares, consider this:

Motley Fool investing expert Scott Phillips just revealed what he believes are the 5 best stocks for investors to buy right now... and Betashares Global Cybersecurity Etf wasn't one of them.

The online investing service he’s run for over a decade, Motley Fool Share Advisor, has provided thousands of paying members with stock picks that have doubled, tripled or even more.*

And right now, Scott thinks there are 5 stocks that may be better buys...

See The 5 Stocks *Returns as of 30 April 2025

Tristan Harrison has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. owns shares of Kogan.com ltd. The Motley Fool Australia has recommended Kogan.com ltd. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

More on Growth Shares

Smiling couple looking at a phone at a bargain opportunity.
Growth Shares

Looking for ASX growth shares? I rate these 2 as buys in May

These ASX investments have an exciting future. Here’s why.

Read more »

A young man punches the air in delight as he reacts to great news on his mobile phone.
Growth Shares

The best ASX growth stocks for smart investors to buy with $5,000

Analysts are bullish on these shares. Let's find out why.

Read more »

Happy young couple saving money in piggy bank.
Growth Shares

Where to invest $2,500 into ASX 200 shares today

Analysts think these shares could be top buys for investors with money to invest.

Read more »

Two people having a meeting using a laptop and tablet to discuss Seven West Media's balance sheet
Growth Shares

3 excellent ASX shares to buy for your SMSF

Analysts think these shares could be top picks for SMSF investors. Let's find out why.

Read more »

A woman presenting company news to investors looks back at the camera and smiles.
Growth Shares

2 ASX growth shares to supercharge your portfolio

Analysts think these shares could be in the buy zone for growth investors right now.

Read more »

A group of people gathered around a laptop computer with various expressions of interest, concern and surprise on their faces. All are wearing glasses.
Growth Shares

Turn $300 into significant wealth: 3 explosive ASX opportunities for Aussie investors

Analysts think these shares could be great picks for growth focused investors.

Read more »

A man looking at his laptop and thinking.
Growth Shares

What I'd buy with $2,000 on the ASX right now

Here are three options for investors to look at this month.

Read more »

Silhouette of CEO standing in conference room looking out at cityscape.
Growth Shares

3 founder-led ASX 200 shares with serious long-term upside

Let's see what makes these shares top picks according to analysts.

Read more »