The Australian stock market may not be home to popular companies like Netflix, Facebook, Apple and Amazon, but the ASX does have a numbers of fast growing tech stocks that you could consider adding to your portfolio.
These 3 ASX technology stocks are amongst the favourites of some highly rated small cap fund managers.
Nearmap Ltd (ASX:NEA) is an aerial imagery company. It captures 88 per cent of Australia’s population up to 6 times per year, and 67 per cent of the US’s population
up to 3 times per year.
The Ausbil MicroCap Fund fund is a holder of the shares. In its March 2018 quarterly performance report, Ausbil noted Nearmap was a standout performer for the Fund in the March quarter, the Nearmap share price gaining 61 per cent.
“The business offers extremely high gross margins and is highly scalable and cash generative. Nearmap is now seeking to replicate this success in the substantially larger market of the US. Increased confidence in the potential of the US operations and visibility on the break-even point underpinned the significant re-rating in the shares.”
As at the end of March, Nearmap was the 7th largest position in the Fund. Nearmap was one of the big winners from the February reporting season.
Afterpay Touch Group Ltd (ASX:APT) is popular amongst a number of top performing small-cap fund managers.
Thorney Technologies names the company as its largest single holding saying Afterpay continues to exceed expectations with the market penetration of what the company calls its “buy now, receive now, pay later” service to Australian retailers and consumers.
Thorney Chairman Alex Waislitz says Afterpay represents more than 25 per cent of all Australian domestic apparel online sales and more than 8 per cent of all online physical retail sales.
“To me, this appears just the beginning for APT with further growth opportunities identified in several new verticals and service industries both domestically and overseas,” says Mr Waislitz.
“We believe APT Executive Chairman, Anthony Eisen, CEO, Nick Molnar, Group Head, David Hancock, and their team have done a tremendous job positioning the company so far, and we continue to believe strongly in their ability to achieve their growth ambitions.”
ReadCloud Ltd (ASX:RCL) digitises and distributes electronic school textbooks. The company was admitted to the ASX in early February at 20 cents per share. The ReadCloud share price is currently 32 cents.
At the time of listing RCL counted as paying clients 50 schools and more than 20,000 users on its platform.
As recorded in the Cyan C3G Fund February letter the Fund subscribed to a small amount of stock in the IPO attracted by the revenue generating business and thematic of electronic textbooks.
“As a parents of high-schoolers we are acutely aware of the archaic nature of physical schoolbooks and believe, if executed well, this company has a bright future.”
The aforementioned Thorney Technologies also holds Readcloud, saying they are excited about the potential of the company.
“Students and teachers using the ReadCloud app can share notes, questions, videos and weblinks within the platform.”
“The capital raise provided it with sufficient cash to fund its expansion plans targeting the more than 2,700 secondary schools in Australia.”