Although the tech sector has fallen out of favour this year, I still believe the long term fundamentals are very positive and having exposure to the sector is a good thing for a portfolio.
But which ASX tech shares should you buy? Two that analysts are tipping as buys are listed below. Here's what you need to know about them:
Image source: Getty Images
Altium Limited (ASX: ALU)
The first ASX tech share to look at is Altium. It is the company behind the Altium Designer printed circuit board design (PCB) software.
PCBs are the boards you find in electronic devices. They are integral to their operation and come in all shapes and sizes, which means that specialist software is required for their design.
The good news is that Altium's software is regarded as the best in the industry. A testament to this is the high profile companies and organisations using it such as BAE Systems, Dell, Microsoft, NASA, and Tesla.
With demand increasing thanks to favourable tailwinds such as the IoT and AI booms, management is forecasting strong growth over the coming years. This includes growing its revenue to US$500 million by 2026. This will be more than double FY 2022's revenue of US$220.8 million.
The team at Jefferies appears confident on the company's outlook. Its analysts currently have a buy rating and $42.32 price target on its shares.
Life360 Inc (ASX: 360)
Another ASX tech share that has been tipped as a buy is Life360.
It is a location technology company that operates in the digital consumer subscription services market. Its key offering is the eponymous Life360 app, which has over 40 million active users. This app offers families features such as communications, driver safety, and location sharing.
Goldman Sach is very bullish on the company due to its massive market opportunity. It highlights that "Life360 is exposed to a US$12bn global TAM with a large opportunity to expand its product suite, grow average revenue per paying circle (ARPPC), increase payer conversion, and lift penetration rates outside of the US."
The broker currently has a buy rating and $7.50 price target on the company's shares.
