If you have room for some new additions this month, then it could be worth considering the two ASX tech shares listed below.
Here's what you need to know about these buy-rated ASX tech shares:
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Aristocrat Leisure Limited (ASX: ALL)
The first ASX tech share that could be a buy is Aristocrat. It is a gaming technology company with a portfolio of leading pokie machines and digital games.
The team at Morgans is bullish on Aristocrat and recently added the company to its best ideas list. The broker has put an add rating and $43.00 price target on its shares.
It commented:
ALL is a global market leader in the rapidly growing land-based gaming and mobile gaming industries. It has delivered revenue growth of 17% pa over the past five years and 80% of revenue in FY21 was recurring. We expect ALL to continue to take market share in all its product segments. Demand for its gaming machines and digital games is resilient to economic cycles.
ALL's 1-year forward P/E has derated to less than 20x from a high of 30x last September. With $3.3bn of currently available liquidity, ALL has significant funding capacity for growth, even after the buyback. It has a stated ambition to build a meaningful presence in the rapidly growing online real money gaming segment, which we believe may be achieved both through organic investment and inorganic acquisitions.
Xero Limited (ASX: XRO)
Another ASX tech that could be in the buy zone is Xero. It is a cloud-based accounting solution platform provider to small and medium sized businesses globally.
Goldman Sachs is very bullish on Xero and recently reiterated its buy rating and $118.00 price target on the company's shares. This followed news that the company has increased subscription prices in the key ANZ and UK markets.
The broker commented:
We remain confident Xero will be able to execute on these increases while preserving its existing subscriber base, noting their strong track record in putting through increases while driving churn lower. We would also not be surprised if NA/ROW markets were also considered for a pricing increase, given they previously followed ANZ/UK by 2 months in Nov-21.
We are Buy-rated on XRO.AX, with a 12m TP of A$118.
