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3 top small cap shares with enormous potential

During the last 12 months small cap shares have outperformed their large cap peers by a decent margin.

This evident in the performance of the S&P/ASX Small Ordinaries (Index: ^AXSO) (ASX: XSO) which has pushed 17% higher during this time, compared to the 5.5% gain made by the benchmark S&P/ASX 200.

Whilst there is no guarantee that this outperformance will continue over the next 12 months, I remain confident that there is enough quality at the small-end of the market for it to deliver another market-beating 12 months.

Three top small cap shares that I think are worth considering today are listed below. Here’s why I like them:

Helloworld Ltd (ASX: HLO)

I think this travel company is largely underappreciated by the market and a great option for investors. The growing popularity of its integrated service offering led to Helloworld recently posting first-half profit before tax growth of 39.2% to $7.3 million. Pleasingly, management believes the company is well placed to continue the positive momentum into the second half of FY 2018.

Swift Networks Group Ltd (ASX: SW1)

This entertainment and telecommunication services company provides fully integrated solutions for the resources, hospitality, lifestyle village, and aged care accommodation sectors. Whilst all these sectors are lucrative opportunities, I am most bullish on its prospects in the aged care sector due to Australia’s ageing population. Yesterday Swift Networks announced its first-half results which revealed a 32% increase in half-year revenue.

Zenitas Healthcare Ltd (ASX: ZNT)

This growing home care and health services company listed on the ASX last year and looks set to be a big winner from the National Healthcare Reform. This Reform aims to push the burden of healthcare services from hospitals into primary care providers such as Zenitas. As a result, I believe it is in a great position to profit over the long term. Especially due to operating in a highly fractured industry which provides it with opportunities to accelerate its growth through acquisitions.

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 of the stocks mentioned. The Motley Fool Australia owns shares of Helloworld Limited. The Motley Fool Australia has recommended Zenitas Healthcare Ltd. 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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