Much of the hype in the media has been about fintech stocks, but not all finance companies with good future prospects have to be technology companies as well. Here are five finance companies that could boost the returns in your portfolio, simply because they are growing actively. Take a closer look before the rest of the market discovers them.
Emerchants Ltd (ASX: EML) has a market cap of $394m and is the biggest of the companies here. Emerchants provides electronic payments solutions for prepaid card products and services, issuing and processing debit cards as well as others like store gift cards. Growth in sales is expected to soar as corporate bookmakers’ customers make more use of winnings cards. The company has also expanded into the UK and just this week into the US with its virtual payments platform.
Consolidated Operations Group Ltd (ASX: COG) has a market cap of $157m but is virtually unheard of. Formerly known as Armidale Investment Corporation, Cons Operations is the holding company for several diversified companies offering business finance for several different purposes including asset and equipment finance, insurance and mortgage solutions and leasing and commercial asset rental. Several recent acquisitions should add materially to revenue growth, with earnings per share expected to follow.
Pioneer Credit Ltd (ASX: PNC), with a market cap of $152m, is a debt collector, specialising in unsecured retail debt portfolios. Pioneer also offers customers loans so they can consolidate debts and refinance existing loans. The company recently announced that it expected to see a net profit for the 2018 financial year (FY2018) to rise by more than 49% over the FY2017 profit. At the current share price of $2.54, shares are trading at an undemanding P/E of 15x for FY2017.
Axsesstoday Ltd (ASX: AXL) has a market cap of $72m. The company provides financing to businesses for new or used commercial equipment such as display fridges, pizza ovens, forklifts and other yellow goods. The list even extends to computers, printers and copiers as well as workstations and furniture. In some respects, Axsesstoday resembles Silver Chef Limited (ASX: SIV) and probably competes with Silver Chef in some industries. The company has reported strong market share growth translating into earnings, with a 157% growth in net profit after tax for FY2017 compared to FY2016, and flagged a 67% increase in net profit in FY2018.
Easton Investments Ltd (ASX: EAS), with a market cap of $37m, is the baby of the bunch. The company provides traditional accounting and asset & wealth management services. The first half of FY2017 wasn’t one to write home about but was impacted by a one off extraordinary item. The good news is that the company continues to grow its funds under advice, as well as the number of SMSFs that are under the company’s administration. Additionally, the majority of Easton’s businesses generate higher earnings in the second-half of the year so that we can put the first half behind us.