2 quality ASX growth shares that could be buys in July

These growth shares might make investors smile in July…

| More on:
Surge in ASX share price represented by happy woman pointing to her big smile

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 a lot of growth shares out there for investors to choose from. To narrow things down, I have picked out two that analysts love.

Here's why analysts rate these growth shares highly:

Domino's Pizza Enterprises Ltd (ASX: DMP)

This pizza chain operator has been growing at a consistently solid rate for over a decade. This has been driven by the popularity of its offering (who doesn't like pizza?) and the ongoing expansion of its footprint.

That expansion saw the company's store network reach 2,800 stores by the end of the first half of FY 2021. Pleasingly, it doesn't expect to stop there and is aiming to double its presence in existing markets over the next decade.

In addition to this, the company has just announced its entry into Taiwan via the acquisition of Domino's Taiwan. It sees opportunities to increase its network to 400+ stores in the country in the future.

A recent note reveals that Bell Potter currently has a buy rating and $122.00 price target on the company's shares. It highlights that Domino's still has significant capacity to make further acquisitions following the Domino's Taiwan transaction.

Nitro Software Ltd (ASX: NTO)

Another ASX growth share to look at is Nitro. It is a global document productivity company helping businesses of all sizes eliminate paper, accelerate business processes, and drive digital transformation.

Nitro lets more than 11,000 businesses globally achieve this through its PDF productivity and eSigning solutions. This includes 68% of the Fortune 500 and three of the Fortune 10.

Demand for its offering continues to grow and is driving significant annualised recurring revenue (ARR) growth. For example, in FY 2020, the company reported a 64% increase in ARR to $27.7 million. And more of the same is expected in FY 2021, with management guiding to ARR of $39 million to $42 million. This will mean year on year growth of 41% to 51.6%.

Positively, this is still well short of a PDF document productivity and eSigning total addressable market (TAM) estimated to be worth $28 billion.

Helping it win further market share will be its recent acquisition of PDFpen. This gives Nitro access to the Apple ecosystem, which it previously did not have. And given how enterprise usage of iOS devices is forecast to increase from around 5% to 20% in the future, this bodes well for Nitro's growth.

Morgan Stanley is positive on the company and last week retained its overweight rating and $3.70 price target on its shares.

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has recommended Dominos Pizza Enterprises Limited and Nitro Software 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

Overjoyed man celebrating success with yes gesture after getting some good news on mobile.
Growth Shares

These ASX growth shares could rise 18% to 30%

Let's see which shares are being tipped to rocket.

Read more »

Ecstatic woman looking at her phone outside with her fist pumped.
Growth Shares

Goldman Sachs tips this ASX 200 growth stock to rise 35%

Let's see what the broker is saying about this growing company.

Read more »

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

The ultimate ASX growth shares to buy with $5,000

Brokers are very bullish on these names. But why? Let's find out.

Read more »

Australian dollar notes in the pocket of a man's jeans, symbolising dividends.
Growth Shares

Where to invest $1,000 into ASX shares in June

These shares could be buys according to analysts.

Read more »

Young female investor smiling and speaking on mobile phone while sitting in front of laptop
Growth Shares

Looking for ASX growth shares? I rate these 2 as top buys for June

I’m very excited about the growth potential of these stocks…

Read more »

Two smiling work colleagues discuss an investment or business plan at their office.
Growth Shares

3 high-conviction ASX growth shares to buy

Analysts have good things to say about these stocks.

Read more »

happy investor, share price rise, increase, up
Growth Shares

Where to invest $5,000 into ASX growth shares now

These shares could be destined for big things according to analysts.

Read more »

ETF spelt out with a piggybank.
ETFs

Want to buy ASX growth shares? Consider these ETFs instead

Growth ETFs can be easier to invest in than shares.

Read more »