A new month calls for new ASX growth shares to consider adding to your portfolio. Here are three that I’m liking in December as long-term plays.
Aristocrat Leisure
Aristocrat Leisure Limited (ASX: ALL) is a leading gaming provider and publisher with operations in Australia, New Zealand, the Americas and other countries. The Aristocrat share price has made a slow and steady recovery since its March lows but still trades at a 10% discount to pre-COVID levels.
ALL share price chart
Aristocrat recently released its FY20 results, which were pretty much in line with expectations. While its land-based segment underperformed due to the effects of COVID-19, the company saw strong growth in its digital segment with bookings growth and profit up 31% and 34%, respectively.
I’d be happy to add Aristocrat shares to my portfolio at current levels. I like the direction the company is going with its digital segment and I think it’s fair to assume that in-person gambling will return to normal levels in the long-run.
For more reading on Aristocrat, check out this in-depth article: How I analyse Aristocrat Leisure shares.
Domino’s Pizza
Although the Domino’s Pizza Enterprises Ltd (ASX: DMP) share price is trading near all-time highs, I view it as an extremely well-run company with a significant runway for growth ahead.
The way that Domino’s uses customer data to derive insights and develop effective marketing campaigns has been one of its key drivers of success. It’s done a terrific job of localising its product into various different cultures across nine different countries.
A forward P/E ratio of 41 seems fairly valued to me considering the company plans to double its number of stores between 2025 and 2033, with an outlined target of around 5,550 stores in this time.
The company has typically carried a significant amount of debt in order to fund growth in new markets. However, it’s also been able to deliver an underlying return on equity (ROE) of around 40% for the last 3 years.
If you’re interested in learning more about the business, check out this deep dive on Domino’s shares.
Objective Corporation
Objective Corporation Limited (ASX: OCL) is a multinational software provider with a suite of products that streamline efficiencies across bureaucratic activities.
I’m sure most people could recall at least one bad or slow experience they’ve had with a bureaucratic process at some point. As long as we have government regulation and policies, I believe it’s likely that these processes could always be completed faster and more efficiently.
Objective Corp has the attractive features that come with being a software-as-a-service (SaaS) business, with annually recurring revenues and expanding gross margins as the business scales. Its clients are primarily governments, which makes revenues even stickier as these public sector clients are often on multi-year long contracts.
For more reading, check out my in-depth analysis of Objective Corporation shares.