The ASX share market continues to be volatile, which gives investors the opportunity to buy ASX growth shares at cheaper prices.
Businesses that are still growing revenue while the share price falls could be an idea for investors to look at. The experts have identified two ASX businesses that have loads of growth potential for the long term.
After a heavy sell-off since the start of the year, these two ASX growth shares have been picked by analysts:
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Temple & Webster Group Ltd (ASX: TPW)
Temple & Webster is the leader of Australia's online homewares and furniture retailing industry. It has a long-term goal of becoming the largest, online or offline.
It sells hundreds of thousands of products. Plenty of those are shipped directly by the supplier, which decreases inventory risk for the ASX growth shares and also allows it to offer customers a wider range on the website. Temple & Webster also has a growing private label range, which typically comes with a higher profit margin.
Despite all of the impacts of COVID-19 on the supply chain and other effects, Temple & Webster has managed to keep growing revenue very quickly. The FY22 first-half revenue was up 46% year on year. It was a 218% increase in revenue over two years.
The growing scale increases the operating leverage, allowing the company to accelerate investment in future growth and take market share. Some areas for re-investment include marketing, technology development, product range, and the overall customer experience.
The increased scale provides cost advantages in product sourcing, logistics, and marketing.
The ASX growth share is working on growing its presence in 'trade and commercial' as well as 'home improvement'. The company says that the home improvement category adds another $16 billion to its addressable market.
Temple & Webster is currently rated as a buy by the broker UBS with a price target of $11.80.
Volpara Health Technologies Ltd (ASX: VHT)
Volpara is a leading breast screening medical technology business. It is growing its focus and abilities with 'risk' for the patient to maximise the chance of finding breast cancer early.
It is utilising its 49 million images, which is one of the world's biggest data sets of breast x-rays, to change from screening for detection to prevention.
The Volpara share price has fallen by a third since the start of the year. But the company continues to grow.
In the company's FY22 half-year result its gross profit margin was 91.4%.
It has also made an initial investment into RevealDx, a lung AI company based in Seattle, and signed a collaboration agreement with Riverain Technologies, positioning Volpara for lung screening expansion.
The company's average revenue per user (ARPU) continues to grow – it was US$1.46 in the first half of FY22 and increased to US$1.47 in its third quarter. The third quarter saw average ARPU deals of US$1.65.
The ASX growth share has a market share of 35% of US women being screened. Third-quarter revenue was NZ$7 million, up 50% year on year. It's on track to meet annual revenue guidance for the year of NZ$25 million. Annual recurring revenue has now reached NZ$30.4 million.
It's currently rated as a buy by the broker Morgans, with a price target of $1.94.
