Leading broker names 2 ASX growth shares to buy

PointsBet Holdings Ltd (ASX:PBH) and this ASX growth share could be top options for investors according to one leading broker…

| More on:
rising asx share price represented by man drawing growth chart on blackboard

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

Goldman Sachs has been running the ruler over a number of shares that presented at its recent Emerging Leaders Conference.

Two growing ASX tech shares that the broker is particularly positive on are listed below. Here's why it rates them highly:

Hipages Group Holdings Ltd (ASX: HPG)

Hipages is an online platform and software as a service (SaaS) provider that connects tradies with residential and commercial consumers. At the last count, over three million Australians had used its platform, providing work to over 34,000 trade businesses that are subscribed to the platform.

Goldman Sachs is a big fan of the company and believes it has a very long runway for growth. This is due to its belief that it could one day win the same share of advertising spend as Carsales.Com Ltd (ASX: CAR) and REA Group Limited (ASX: REA) do in their respectively industries.

Goldman explained: "We see HPG as an attractive medium-term growth stock – HPG currently captures c.5% of the total industry advertising spend; by contrast REA/CAR capture c.40-60% of spending in their respective categories. As HPG builds out its ecosystem (including the imminent launch of the new "TradieCore" field service software solution), we see scope for HPG to increase its share towards these levels over the long term as the marketplace leader."

The broker has a buy rating and $3.35 price target on its shares.

PointsBet Holdings Ltd (ASX: PBH)

Another growing company that Goldman is a fan of is PointsBet. It likes the sports betting company due to its strong position in a market expected to grow materially in the future.

In fact, the broker estimates that the US sports and iGaming market could be worth upwards of US$53 billion in the future. And thanks to its partnerships with sports teams and broadcasters, it feels it is well-placed to win market share.

Goldman said: "We like PBH due to i) PBH's leverage to the burgeoning US Sports Betting and iGaming market which we forecast to be a US$53 bn TAM opportunity at maturity, ii) our view that PBH is well-placed to achieve 10% share in states it operates in, iii) upside risk to long-run sustainable margins in Aus and the US which was reaffirmed by the strong margin result in 3Q21, iv) Scalability benefits ahead noting positive impacts from the NBCUniversal deal to come and imminent launch of iGaming (which we believe will provide both cost and revenue synergies), and v) strong management team and execution track record."

The broker has a buy rating and $17.20 price target on its shares.

James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. owns shares of and recommends Hipages Group Holdings Ltd. and Pointsbet Holdings Ltd. The Motley Fool Australia has recommended carsales.com Limited, Pointsbet Holdings Ltd, and REA Group Limited. 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

Three happy office workers cheer as they read about good financial news on a laptop.
Growth Shares

5 ASX growth shares to buy and hold

Analysts think these shares could be top picks for investors looking for growth options.

Read more »

Two players on a field pump their fists in the air, indicating two of the best
Growth Shares

The ultimate buy and hold ASX 200 shares for long-term investors

These buy-rated shares could be great options for investors with a long time horizon.

Read more »

A bearded man holds both arms up diagonally and points with his index fingers to the sky with a thrilled look on his face over these rising Tassal share price
Growth Shares

3 unstoppable ASX shares to buy and hold for the next decade

These shares are going places over the remainder of the decade and beyond.

Read more »

Four piles of coins, each getting higher, with trees on them.
Growth Shares

2 high-growth ASX shares to buy today: brokers

These stocks have a strong growth outlook.

Read more »

Two university students in the library, one in a wheelchair, log in for the first time with the help of a lecturer.
Growth Shares

2 top-quality ASX shares to buy for beginner investors

These stocks could be a great place to start investing.

Read more »

A man in full American NFL playing kit crouches over with his arms across his chest in a defensive stance against a dark background.
Growth Shares

Here's why these two ASX 300 shares are great ones to own

These businesses are two of the fastest-growing stocks in the ASX 300 and are liked by fund manager WAM.

Read more »

A smiling businessman in the city looks at his phone and punches the air in celebration of good news.
Growth Shares

3 ASX growth shares you'll wish you bought in June

Analysts think these shares could be destined for big things in the future.

Read more »

Father and daughter with hands on a small plant.
ETFs

Focused on growth? Here are 3 ASX ETFs to consider

Growth investors must ignore the current market noise about tariffs and focus on the long-term horizon.

Read more »