If you're wanting to add some growth shares to your portfolio in March, then you might want to consider the ones listed below.
Here's why they have been tipped as the shares to buy:
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Nearmap Ltd (ASX: NEA)
Nearmap is an aerial imagery technology and location data company with operations in both the ANZ and North American markets. It provides businesses with instant access to high resolution aerial imagery, city-scale 3D datasets, and integrated geospatial tools.
Although it was targeted by a short seller earlier this year, the market doesn't appear concerned by this report following a stronger than expected half year update in February. Not only did Nearmap outperform expectations, the part of the business that was heavily criticised by the short seller did the heavy lifting.
This went down well with analysts at Goldman Sachs. In response to its results, it put a buy rating and $2.95 price target on Nearmap's shares.
It believes the headwinds Nearmap has been facing will ease in 2021, which should have a positive impact on demand. Looking further ahead, the broker believes the company's balance sheet is strong enough to see it through to profitability in FY 2023.
Xero Limited (ASX: XRO)
Another ASX growth share that Goldman is a fan of is Xero. It is a provider of a cloud-based business and accounting solution to small and medium sized businesses around the world.
Despite the pressures that small businesses have been under during the pandemic, Xero has continued to perform strongly over the last 12 months.
In fact, it has even continued to add subscribers at an impressive rate. For example, at the end of the first half of FY 2021, Xero had grown its subscribers by 19% year on year to 2.45 million. This supported a 21% increase in half year operating revenue to NZ$409.8 million and a 15% lift in total subscriber lifetime value to NZ$6.2 billion.
Since then, the company has announced the acquisition of Planday for a total potential consideration of ~A$285 million.
Goldman Sachs believes this acquisition will provide it with a meaningful step into Europe. In addition, it expects it to help Xero build out its app ecosystem. This is a big positive as the broker believes that monetising its app ecosystem has the potential to be a key driver of growth in the future.
At present, Goldman Sachs has a buy rating and $157.00 price target on its shares. It believes Xero is capable of delivering strong revenue growth over multiple decades.
