The two ASX shares mentioned below are delivering very useful growth right now.
The share prices of both of these businesses have gone up significantly over the last year as they recover from the effects from the COVID-19 crash.
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Pro Medicus Ltd (ASX: PME)
This ASX share describes itself as a leading medical imaging IT provider that provides a full range of radiology IT software and services to hospitals, imaging centres and health care groups worldwide.
Pro Medicus might be one of the most profitable businesses on the ASX with an earnings before interest and tax (EBIT) margin of 59%, though the company doesn't expect this to be maintained due to one-off COVID-19 impacts that lowered expenses.
Despite a large impact of the strengthening of the Australian dollar on its predominately US-based earnings, Pro Medicus recently reported a 7.8% increase in half-year revenue, a 12.4% rise of net profit and a 25.9% increase of underlying profit before tax.
The company is expecting a stronger second half and FY22. Not only are examination levels getting back to pre-COVID levels but the ASX share has won several new large contracts such as Northwestern, NYU Langone and Medstar which will unlock more revenue at a high profit margin. The Intermountain and Californian Hospital contracts will also come online in FY22.
Each new win has the potential to unlock more deals for the company, which means Pro Medicus is more likely to benefit further from expanding data sets, the need for remote reporting and strong network effects.
However, the Pro Medicus share price has risen strongly – it has gone up 150% over the last year. UBS has a neutral rating for Pro Medicus, with a price target of $46.
EML Payments Ltd (ASX: EML)
EML is an ASX share that has a variety of payment services. It says that it develops tailored payment solutions for businesses with options for disbursing payouts, gifts, incentives and rewards. The payments business says that it powers many of the world's top brands and expects to process over $18 billion in GDV in FY21 across 28 countries in Australia, Europe and North America.
Some of its clients include companies like Coca Cola, Intel, Isuzu, NSW Transport, Paddy Power, Laybuy Holdings Ltd (ASX: LBY) and the UK Home Office.
The FY21 half-year result was a period of strong growth for EML with gross debit volume (GDV) growth of 54% to $10.2 billion, revenue growth of 61% to $95.3 million, earnings before interest, tax, depreciation and amortisation (EBITDA) growth of 42% to $28.1 million, underlying net profit (NPATA) growth of 30% to $13.2 million and underlying operating cash inflows went up 68% to $35.1 million.
Its general purpose reloadable business is doing well, the existing non-PFS business growing by 25% year on year, with strong organic growth from salary packaging (up 60%) and gaming (up 42%). However, the gift and incentive division is still struggling due to lockdowns impacting physical gift cards and shopping centres.
For the full FY21 result it's expecting revenue to grow between 48% to 56% and NPATA to increase by 25% to 40% to a range of $30 million to $33.5 million.
