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At the small end of the Australian stock market are many companies that have the potential to grow significantly in the future.
Two things investors may want to know better are listed below. Here’s why you need to be on your watchlist:
The first small cap you see is Damstra. This is a growing and integrated workplace management solution provider. Its cloud-based workplace management platform is used by companies around the world to track, manage and protect their employees and assets.
Damstra recently Fourth quarter update And it became clear that its annual recurring revenue (ARR) reached $ 35 million at the end of the quarter. This was 65% higher than the previous corresponding period. Another positive factor was Damstra’s EBITDA margin. This expanded to a record of 30% during the quarter.
Fortunately, management estimates that by 2022 its total addressable market is worth US $ 20 billion. This gives you a very long runway for growth.
The Morgan Stanley team has only a neutral valuation on the stock, but the $ 1.25 price target is significantly higher than the current stock trading.
Another small cap to note is the MNF. It specializes in Voice over Internet Protocol (VoIP) technology used to support services such as conference calls, online business conferencing, and digital data transfer.
Demand for the service was strong, especially during the pandemic. This is due to favorable tailwinds such as working from home. In addition to this, the deployment of NBN and the removal of telephone lines are driving the adoption of VoiP.
MNF, coupled with a strong balance sheet that enables its international expansion and potential acquisitions, appears to be in a good position to continue strong growth over the long term.
Morgan Stanley is positive about the company. Currently, the stock has an overvalue and a $ 6.30 price target.
Two Top Small Caps ASX Share for Your Watchlist
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