Why brokers say these ASX growth shares are buys

These growth shares could be top options according to analysts…

| More on:
happy investor, share price rise, increase, up

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

The Australian share market is home to a good number of shares that are growing at a quicker than average rate.

Two that have been tipped to continue doing so in FY 2023 are listed below. Here's why analysts think they are top options for growth investors:

Allkem Ltd (ASX: AKE)

There's no doubt that the lithium industry is running hot at the moment.

And while the valuations of some explorers and developers are questionable, the Allkem share price is seen as very attractive by analysts at Macquarie.

This is because Allkem is already producing significant quantities of the battery making ingredient and benefiting from the insatiable demand and high prices. Whereas the many explorers popping up on the ASX boards have no idea what the price will be when they commence production.

It is also worth noting that management is aiming to grow Allkem's production 3x by 2026. This should ensure that it is well-placed to take advantage of the high lithium prices before they normalise again when supply improves.

In light of this, Macquarie has put an outperform rating and $21.00 price target on its shares. This compares to the latest Allkem share price of $14.36.

Readytech Holdings Ltd (ASX: RDY)

Another ASX share that has been tipped to continue its strong growth is Readytech. 

It is an enterprise software provider to several market verticals such as higher education and local government. 

Goldman Sachs highlights that the company operates in market niches that are under-served by both large and small enterprise software competitors. 

And combined with its high levels of recurring revenue and ultra low churn levels, Goldman expects Readytech to "continue to grow mid-teens organically while making accretive acquisitions." 

As a result of this positive outlook, the broker currently has a buy rating and $4.60 price target on its shares. This compares favourably to the latest Readytech share price of $2.80.

Motley Fool contributor James Mickleboro has positions in Allkem Limited. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has positions in and has recommended Readytech Holdings Ltd. The Motley Fool Australia has recommended Readytech Holdings Ltd. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

More on Growth Shares

Two plants grow in jars filled with coins.
Growth Shares

3 ASX 200 growth stocks up more than 100% in 1 year that could charge higher

It's been a memorable year for shareholders of these 3 companies.

Read more »

Afterpay share price a happy shopper with a wide mouthed smile holds multiple shopping bags up around her shoulders.
Growth Shares

The pros and cons of buying Zip shares in June

Should investors buy now or wait until later?

Read more »

A smiling woman holds a Facebook like sign above her head.
Growth Shares

3 ASX growth shares I'd buy for the next 10 years

Let's see why these shares could be top picks for the long term.

Read more »

wheelchair user in an office talking on mobile phone
Growth Shares

Why I'd buy this ASX growth share instantly

I’m calling on this stock to deliver strong returns.

Read more »

A happy boy with his dad dabs like a hero while his father checks his phone.
Growth Shares

2 ASX growth shares to buy in June: experts

These businesses have strong growth potential.

Read more »

Rocket powering up and symbolising a rising share price.
Growth Shares

Buy these stellar ASX growth shares with $1,000

Analysts think these shares would be top buys right now.

Read more »

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 »