3 Best undervalued ASX tech stocks to buy

Buying high-quality businesses with exceptional returns on capital during periods of valuation compression has historically been very lucrative and the following three ASX tech stocks fit this description right now.

Best undervalued ASX tech stocks

Xero Limited (ASX: XRO) 

Life360, Inc. (ASX: 360) 

WiseTech Global Limited (ASX: WTC) 

Xero Limited (ASX: XRO) 

Xero Limited  is one of the best undervalued ASX tech stocks to buy because even though the stock is down 56.75% over the past 12 months, it has reported strong revenue growth helped by AI led innovation.

The company in FY26 generated operating revenue of NZ$2.75 billion which represented strong 31% year-on-year growth while adjusted EBITDA rose 18% to NZ$757 million and free cash flow has increased more than five times over the last four years.

Xero also achieved solid customer and monetisation growth as total customers increased 11% to 4.92 million while average revenue per customer climbed 23% to NZ$55.44 which was supported by higher payments adoption.

The business is also positioning itself aggressively for the AI era through products such as JAX AI-powered analytics and deeper integrations with Anthropic’s Claude models.

The current market capitalisation is $13.39 billion and with FY27 revenue guidance of NZ$3.62 billion to NZ$3.73 billion alongside improving operating leverage, Xero is well positioned to create significant long-term shareholder value.

Life360, Inc. (ASX: 360) 

Life360, Inc. is one of the best undervalued ASX tech stocks to buy as the company reported strong growth alongside improved monetisation even after the stock declined 41.2% over the past 12 months.
The company in the March 2026 quarter generated total revenue of US$143.1 million which was up 38% year-on-year from US$103.6 million because of strong subscription growth and better platform monetisation.

Subscription revenue rose 32% year-on-year to US$108.2 million while advertising revenue jumped to US$19.7 million from US$4.6 million in the prior corresponding period which reflects the success of the company’s expanding ad-tech and data ecosystem after recent acquisitions.

Life360 also retained strong user engagement with around 97.8 million monthly active users across more than 180 countries while management recently announced a US$225 million multi-year share buyback program which is backed by twelve consecutive quarters of positive operating cash flow.
The current market capitalisation is $4.35 billion while recent developments such as the acquisition of advertising technology platform Nativo are expected to further increase monetisation opportunities.

WiseTech Global Limited (ASX: WTC) 

WiseTech Global Limited  has emerged as one of the best undervalued ASX tech stocks to buy because its role as the operating system for global trade and logistics is a solid moat while the stock has declined 61.65% over the past 12 months.

The company in 1H26 reported total revenue of US$672.0 million which rose 76% year-on-year due to ongoing CargoWise expansion and the transformational e2open acquisition.
WiseTech also reported EBITDA of US$252.1 million which increased 31% year-on-year along with strong free cash flow of US$153.6 million which highlights the scalable and cash generative nature of its platform.

Management is actively embedding automation and AI agents across CargoWise which will improve monetisation and long-term customer productivity.

The current market capitalisation is $12.81 billion and FY26 revenue guidance of US$1.39 billion to US$1.44 billion along with deeply embedded logistics ecosystem across 193 countries makes WiseTech well positioned to create significant shareholder value over the long-term.

(Source: Company Announcements)