- IDP Education could be an outperformer due to many of its smaller competitors failing to survive the crisis.
- Megaport clocked a decent 8% quarter-on-quarter growth in monthly recurring revenue (MRR) to AU$6.8 million.
- Temple & Webster appears well-positioned to capture the potential market share over the long term.
The whole essence of active investing is to at least beat the benchmark or the broader market’s return. Despite putting in all the hard work, efforts and time, if a self-curated portfolio is not even able to catch up with the market’s return, then index funds could be a better option. This is popularly known as passive investing.
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The following three ASX listed stocks are touted to outpace broader markets, as indicated by the interest seen in these counters offlate.
- IDP Education Limited (ASX:IEL)
The first outperformer on our list is IDP Education. The company provides English language testing service along with student placement services across the globe. Although the business conditions are somewhat challenging right now, the company is witnessing improvements.
Furthermore, the longer the pandemic halts these essential services for international students, the stronger its market position will become due to pent-up demand. Another reason is longer restrictions would also make it harder for some smaller competitors to remain afloat. With many of its smaller competitors failing to survive the crisis, the company is expected to grow its market share meaningfully once the pandemic passes. As a result, the outlook remains very positive for the company. The IEL share price last closed at AU$22.71 on 10 June 2021.
- Megaport Limited (ASX:MP1)
Another growth share that is capable of delivering higher returns than the broader market is Megaport. The company is in the business of elasticity connectivity and network services. Megaport’s service utilises software defined networking (SDN), enabling customers to connect their network to other services across the Megaport’s established network. This translates to a direct control over the services by customers via their computers, mobile devices, or open API. This has proven to be a very popular business model, leading to rapid growth in its recurring revenues over the last few years.
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The company has continued its strong performance in FY 2021. It recently released its Q3 FY21 update and revealed a decent 8% quarter-on-quarter increase in monthly recurring revenue (MRR) to AU$6.8 million. The MP1 Share price last closed at AU$15.84.
- Temple & Webster Group Limited (ASX:TPW)
The last company on our list is an online furniture and homewares retailer, Temple & Webster. With online furniture shopping still in its nascent stage in comparison to the offline retail space, Temple & Webster appears well-positioned to capture the potential market share over the long term, owing to its leadership position. The management recently revealed its plans to go aggressive on investments to take advantage of the transition and cement its position as the market leader.
The TPW share price has been moving in a range since the last quarter and last closed at AU$10.42.