3 under-researched stocks for your watch list

Matrix Composites & Engineering Limited (ASX:MCE), Australian Ethical Investment Limited (ASX:AEF) and IDT Australia Limited (ASX:IDT) could all be worthy additions to your watch list.

| More on:
a woman

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

The Australian Microcap Investment Conference has once again provided investors with a plethora of actionable investment leads.

With company market capitalisations (caps) ranging from the truly tiny AEERIS FPO (ASX: AER) with a market capitalisation of just $7 million to the much larger $400 million panel repair consolidator AMA Group Ltd (ASX: AMA), the one thing all companies had in common was growth potential.

Another important point about these small, growth companies is that for the most part they remain off-the-radar of both brokers and investors. This under-researched situation lends itself to creating opportunity for enterprising investors keen to sniff out opportunities.

Here are three stocks which caught my eye…

Matrix Composites & Engineering Limited (ASX: MCE) was once a $750 million company with a share price north of $10, but today is a relative minnow with a market cap of just $60 million and a share price of 63 cents.

Matrix is a leading developer and manufacturer of subsea buoyancy systems for use in the oil and gas industry. Obviously its business is currently feeling the pressures of reduced capital spending as a result of the weak oil price, however, the company remains profitable and with a strong balance sheet which should see it weather the current storm.

Australian Ethical Investment Limited's (ASX: AEF) share price is trading close to an all-time high putting the company's market cap at around $70 million.

Australian Ethical is a fund manager which operates in the growing niche of investment management that meets a range of social, environmental and ethical principles. The company currently has $1.2 billion in funds under management.

IDT Australia Limited (ASX: IDT) has been a great performer for shareholders in the past year with the stock up 85% which has boosted IDT's market cap to $73 million.

IDT owns and operates a state-of-the-art pharmaceutical manufacturing facility and in 2014 the group acquired a range of US generic drug products which will see IDT expand into the generics market under a distribution agreement with US-based ANI Pharmaceuticals Inc. It has plans to sell the generics into major pharmacy chains such as Walmart, CVS, RiteAid and Walgreens.

Motley Fool contributor Tim McArthur has no position in any stocks mentioned. Unless otherwise noted, the author does not have a position in any stocks mentioned by the author in the comments below. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

More on ⏸️ Investing

Close up of baby looking puzzled
Retail Shares

What has happened to the Baby Bunting (ASX:BBN) share price this year?

It's been a volatile year so far for the Aussie nursery retailer. We take a closer look

Read more »

woman holds sign saying 'we need change' at climate change protest

3 ASX ETFs that invest in companies fighting climate change

If you want to shift some of your investments into more ethical companies, exchange-traded funds can offer a good option

Read more »

a jewellery store attendant stands at a cabinet displaying opulent necklaces and earrings featuring diamonds and precious stones.
⏸️ Investing

The Michael Hill (ASX: MHJ) share price poised for growth

Investors will be keeping an eye on the Michael Hill International Limited (ASX: MHJ) share price today. The keen interest…

Read more »

ASX shares buy unstoppable asx share price represented by man in superman cape pointing skyward
⏸️ Investing

The Atomos (ASX:AMS) share price is up 15% in a week

The Atomos (ASX: AMS) share price has surged 15% this week. Let's look at what's ahead as the company build…

Read more »

Two people in suits arm wrestle on a black and white chess board.
Retail Shares

How does the Temple & Webster (ASX:TPW) share price stack up against Nick Scali (ASX:NCK)?

How does the Temple & Webster (ASX: TPW) share price stack up against rival furniture retailer Nick Scali Limited (ASX:…

Read more »

A medical researcher works on a bichip, indicating share price movement in ASX tech companies
Healthcare Shares

The Aroa (ASX:ARX) share price has surged 60% since its IPO

The Aroa (ASX:ARX) share price has surged 60% since the Polynovo (ASX: PNV) competitor listed on the ASX in July.…

Read more »

asx investor daydreaming about US shares
⏸️ How to Invest

How to buy US shares from Australia right now

If you have been wondering how to buy US shares from Australia to gain exposure from the highly topical market,…

Read more »

⏸️ Investing

Why Fox (NASDAQ:FOX) might hurt News Corp (ASX:NWS) shareholders

News Corporation (ASX: NWS) might be facing some existential threats from its American cousins over the riots on 6 January

Read more »