I think the S&P/ASX SMALL ORDINARIES (Index: ^AXAO) (ASX: XAO) is home to a number of exciting companies with extremely bright futures.
So much so I believe three of them could one day find themselves on the illustrious S&P/ASX 200 (Index: ^AXJO) (ASX: XJO). Here they are:
Amaysim Australia Ltd (ASX: AYS)
In its recent half-year result Amaysim reported an impressive 34% increase in mobile subscribers. But the big news from the announcement was the planned launch of its NBN service. If Amaysim can disrupt the home broadband market in a similar way it disrupted the mobile phone market, this fledgling telco company could have a bright future ahead of it. One key advantage Amaysim has over its competition is its asset-light model. I believe this will allow Amaysim to undercut the bigger players whilst still remaining profitable
Collins Foods Ltd (ASX: CKF)
After a 20% drop in its share price this year, Collins Foods’ shares are now changing hands at just under 14x trailing earnings. I believe this has left its shares in bargain territory and as a great option for investors willing to make a patient buy and hold investment. The reason for the drop in its share price was largely related to a successful $54.5 million placement of shares placed at a discount. As these funds will be used to accelerate its European expansion, I think now could be an opportune time to invest.
Hansen Technologies Limited (ASX: HSN)
Like Collins Food, Hansen Technologies has seen its share price fall significantly in recent months. I believe this sell-off was based largely on valuation, rather than there being a fundamental weakness in its business. So with the billing services provider’s shares now trading at around 23x trailing earnings, I believe they are priced fairly for a buy and hold investment. Especially as I think the stickiness of its current customer base has put it in a good position to deliver solid long-term earnings growth.
5 stocks under $5
We hear it over and over from investors, "I wish I had bought Altium or Afterpay when they were first recommended by The Motley Fool. I'd be sitting on a gold mine!" And it's true.
And while Altium and Afterpay have had a good run, we think these 5 other stocks are screaming buys. And you can buy them now for less than $5 a share!
*Extreme Opportunities returns as of June 5th 2020
Motley Fool contributor James Mickleboro has no position in any stocks mentioned. The Motley Fool Australia owns shares of Hansen Technologies. 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.