Alert market watchers will have noted that on Friday a number of small-cap tech stocks shot up over 5%. While the local bourse isn't home to high flying tech stocks in the league of Facebook and Microsoft, the ASX does have a number of well established, niche software providers spanning from the $1.5 billion Iress Ltd (ASX: IRE), to the smaller GBST Holdings Limited (ASX: GBT) and Infomedia Limited (ASX: IFM).
These stocks have been superb performers over a number of years for investors and highlight the attractive business models which niche software firms often enjoy.
The following three stocks are all small, early stage companies but they have significant growth potential. In most cases these stocks are a long way from their recent highs; as part of a diversified portfolio they could provide some much needed growth in what is otherwise a seemingly low growth environment.
eServGlobal Limited (ASX: ESV) has rallied strongly off recent lows but could still represent good buying at current levels. The company operates a specialist mobile money payments solution that is proving popular with customers across regions including Africa and Asia.
Moko Social Media Ltd (ASX: MKB) is perhaps the closest listed business on the ASX to Facebook. Moko has developed a social network platform that is targeted at college students in the USA. The platform is currently in the early roll-out stage and if it takes hold the group should experience a significant boost to revenue.
Freelancer Ltd (ASX: FLN) shares are trading back down at levels closer to their initial public offering (IPO) float price than the dizzying heights they reached immediately post-IPO. In the six months to June the online freelance recruitment site reported revenue growth of 41% to $11.9 million and the addition of 2.8 million users.
