2 fantastic ASX growth stocks to buy and hold for 10 years

Are you a fan of ASX growth stocks? If so, it might be worth looking into the two shares listed below.

That's because brokers have rated them as buys and see potential for them to rise strongly from current levels. Here's what you need to know about them and why they could be great buy and hold options:

Nextdc Ltd (ASX: NXT)

Analysts at Morgans think that NextDC could be an ASX growth stock to buy in December. They currently have an add rating and $20.50 price target on its shares.

NextDC is a leading provider of innovative data centre outsourcing solutions, connectivity services, and infrastructure management software. Its data centres have been in great demand for some time due to the shift to the cloud.

And with the artificial intelligence megatrend driving a new wave of demand and the company expanding overseas, NextDC's outlook has arguably never been so bright. It is for this reason that Morgans thinks it could be worth snapping up today. It said:

Enjoying all the benefits of the AI growth opportunity with less volatility are the operators of data centres. Data centres are facilities that store, process, and manage the vast amounts of data foundational to AI, ensuring secure and efficient data flow, backup, and recovery. […] Digital Realty recently reported a record sales quarter during which it sold double the data centre capacity of its previous high and about four times more capacity than it usually sells in a quarter.

This reinforces our view that the significant demand for cloud computing and AI-related digital infrastructure is going to underpin attractive returns and long-term growth. […] Our preferred exposure is NEXTDC. It has 17 operational data centres in Australia and nearly a dozen under construction or about to be built across Australasia and Asia.

Readytech Holdings Ltd (ASX: RDY)

Goldman Sachs thinks that Readytech could be a top ASX growth stock to buy this month. It has a buy rating and a $4.25 price target on its shares.

Readytech owns a portfolio of enterprise software businesses across several market verticals, including higher education and local government.

Goldman rates the company highly due to its growing recurring revenue and low churn levels. The broker also points out that Readytech's strong presence in defensive public sector markets and its mission-critical software solutions should help protect earnings during an economic slowdown.

So, with Readytech's shares trading at a significant discount to its peers, it sees this as a great investment opportunity. The broker explains:

Further to its defensiveness, we believe the market has given RDY little credit for improving its organic profile since listing while the company has maintained solid margins and cash flow. In our view, RDY will continue to grow mid-teens organically, underpinned by solid software metrics such as low churn at ~3% and high LTV/CAC. RDY trades at a large discount to ASX tech peers, both on an absolute and growth-adjusted basis, which we believe is too wide considering RDY's business quality and growth outlook.

The post 2 fantastic ASX growth stocks to buy and hold for 10 years appeared first on The Motley Fool Australia.

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

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