Appen Ltd (ASX: APX) shares, Praemium Limited (ASX: PPS) shares and Austock Group Limited (ASX: ACK) shares have performed exceptionally well over the past five years.
Tech shares rallying
As can be seen above, the share prices of Appen, Praemium and Austock shot higher over the past two to five years. Many investors have probably never even heard of these three small companies, so here's a quick overview of each.
Appen
Appen is a technology and linguistics business, specialising in two types of software. One software improves search results, the other provides software for machine translation. Earlier this month, the company announced a profit upgrade, saying that it expects operating profit to be between 40% and 50% higher than last year. The company said artificial intelligence and machine learning has powered a surge in demand for data. According to Dow Jones Newswires, analysts at Bell Potter recently slapped Appen with a $4 price target.
Praemium
The senior management at Praemium had been stirred up recently and the company's share price suffered. In fact, four directors were booted from the company and it has been required to make a one-off provision of almost $1 million.
Nonetheless, Praemium remains a successful small technology company, offering a platform for wealth management professionals like financial advisers. It is a specialist provider of Separately Managed Accounts (SMAs), which some argue is a superior product to traditional managed funds.
In March, before the management shuffle, Morgans analysts put a $0.52 price target on Praemium, according to Dow Jones Newswires.
Austock
Austock is a small-cap company specialising in insurance bonds (also called investment bonds), a type of financial product that is tax-effective for high-income earners and other long-term investors. The company's book of insurance bonds has grown rapidly in recent years with the Government continuing to play around with the superannuation system and investors recognising the flexibility of the bond structure.
However, like Praemium, Austock has had some managerial changes in recent times and issued shares to investors at a steep discount.
Buy, Hold or Sell
If you are seeking a high-risk investment in technology, I think each of these three small companies is worth a closer look. I have my eye on Austock.
