The most exciting investments are the businesses with small capitalisations, but enormous potential.
One company that has grown is Altium Limited (ASX: ALU). It started off as a small company but has now grown to over $1 billion in size.
Here are four companies that have huge potential to grow significantly over the next few years:
National Veterinary Care Ltd (ASX: NVL)
National Veterinary Care is quickly ramping up the number of vet clinics in its portfolio. The veterinary sector is a huge yet fragmented market which provides many opportunities for management to find acquisition targets.
Considering Greencross Limited (ASX: GXL) is its only other listed competitor, I think National Veterinary Care is likely to achieve good growth, particularly as it’s only valued at around 25x FY17’s estimated earnings and is expected to soon pay a dividend.
Afterpay Holdings Ltd (ASX: AFY)
Afterpay is fuelling the ‘buy now, pay later’ approach favoured by millennials.
It’s growing momentum, with its management revealing another big retailer has signed up almost every quarter. For example, two of its latest customers include Wesfarmers Limited’s (ASX: WES) Officeworks and Myer Holdings Ltd (ASX: MYR).
Afterpay isn’t yet making a net profit or paying a dividend.
Fastbrick Robotics Ltd (ASX: FBR)
Fastbrick Robotics is the most speculative on this list. It is developing a robot that can do the bricklaying work of a team of labourers in a fraction of the time. This could revolutionise the construction industry and make building properties a much quicker process.
Fastbrick Robotics isn’t yet making a profit or paying a dividend.
Pureprofile Ltd (ASX: PPL)
Pureprofile is a survey & marketing company that links consumers and businesses. It seeks to learn about customers’ habits through a variety of means and then interpret that data for business management. This is important in an ever-changing consumer market.
It has a presence in Australia, Europe and North America, and is rapidly increasing its reach.
Pureprofile isn’t yet making a net profit or paying a dividend.
I think all four of these businesses have a good chance of outperforming the market over the coming years, particularly National Vet Care and Afterpay.
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 Tristan Harrison owns shares of Altium, Greencross Limited, and NATVETCARE FPO. The Motley Fool Australia owns shares of Altium and Greencross Limited. 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.
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