3 stock picks from a top investment adviser

Stockbrokers tend to have as keener sense as anyone as to what may be the most promising stocks of tomorrow and Matt Felsman is a private client adviser at Shaw Stockbroking. It oversees more than $1 billion in funds under administration. Below Matt offers some insights into a few companies that prominent brokers and large institutions may be accumulating in the hope of making big future profits.

Advanced Braking Technology Ltd (ASX: ABV) is engaged in the commercialisation, research and manufacturing of “safer brake” technology for commercial and industrial vehicles, particularly in the mining sector. Recently the company announced it has raised more than $2m in capital and hopes to develop its “safer brake” technology and intellectual property to become a major seller of brakes into trucking businesses. With a focus on garbage and heavy haulage trucks.

A second company offers an opportunity to tap into what could be a mega-trend of the future. If you’ve noticed that the daily news seems to increasingly revolve around what’s happening on Twitter rather than the actual news events, then Newzulu Ltd (ASX: NWZ) may be a company to cash in on the digital future.

It’s a journalism platform and news wire that aggregates and sells independently provided photos and videos of news events for distribution around the world. One of its main aggregation platforms is Twitter and in that sense it may be the first ASX-listed business able to use Twitter to monetise itself as a disruptive business model with digital tailwinds.

While media organisations like Fairfax Media Limited (ASX: FXJ) are slashing staff as revenues fall, Newzulu boasts a large and growing news team of some 150,000 freelance journalists and contributors worldwide. When a photo or video submitted by a freelancer is bought by a news agency the freelancer is paid the fee minus Newzulu’s share.

The website has professional partnerships with the Australian Associated Press and Press Association and has a global reach via worldwide news burueaus. Unfortunately its backdoor listing status means it remains strictly for the watchlist for now.

Enero Group Ltd (ASX: EGG) is a marketing and communications company which operates out of Sydney, London and New York.

Notably in August two of Australia’s most respected small-cap stock pickers, Contango MicroCap Limited (ASX: CTN) and Perpetual Limited (ASX: PPT) took significant positions in the company.

Contango has a strong stock-picking record having been relatively early investors in outperforming business like iProperty Group Ltd (ASX: IPP) and BT Investment Management Ltd (ASX: BTT).

Now valued around $100 million, Enero Group recently announced operating earnings of $9 million on $119.5 million of revenue, and has been restructuring itself in an attempt to return to consistent profit growth.

Shares have been up 10% over the last month to $1.17, and are still substantially below mid-August highs of $1.30.

One stock that might be an even better bet

It must be noted that some of the above stocks are highly speculative in nature! However, at The Motley Fool we've identified a business with a consistent track record of profit and dividend growth. It looks to be at the beginning of a long growth sweetspot. ... and you can get the name and code FREE right now. Click here for your free copy of "The Motley Fool's Top Stock for 2014." We'll email you all the details straightaway for free.


Motley Fool contributor Tom Richardson has no financial interest in any company mentioned. The views expressed are the author's own and may not reflect the opinions of Shaw. The document has been prepared without taking into consideration any investor's financial situations, objectives or needs. Shaw has made every reasonable effort to ensure the information provided in this document is correct, but cannot make any representation nor warranty as to the accuracy, completeness or currency of that information. Please note that Shaw, its associates, officers and employees may also have interests in the financial products referred to in this document by acting in various roles. They may undertake transactions in those financial products as principal or agent which are not consistent with any advice in this document, if any. Shaw or its authorised representatives may also receive fees or brokerage from dealing in financial products.

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