Why these small cap shares are racing higher today

The Telstra Corporation Ltd (ASX: TLS) share price performance may take the headlines today, but there have been some equally strong gains being made at the small end of the market.

Three small caps that are pushing notably higher are listed below. Here’s why they are on the rise:

The Compumedics Limited (ASX: CMP) share price has rocketed 20.5% to 44 cents after the medical device company announced three-year distribution contracts with three existing, long-term, China-based sleep and neuro-diagnostic and monitoring distributors. The new agreements come with a minimum sales commitment of $15 million over the three years. Compumedics has had a lot of success in the China market of late, growing its business by an average of 20% per annum over the last five years. Management believes this agreement is a sign that it can continue double-digit growth in the country for the foreseeable future. Given its strong growth prospects in the country, Compumedics could be worth a closer look.

The Hills Ltd (ASX: HIL) share price has climbed 4.5% to 22.5 cents after the electronics and communications products manufacturer announced that it has been awarded the contract to supply the nurse call solution for the new Westmead Central Acute Service Building at the $1 billion Westmead Redevelopment project in New South Wales. No financial terms were disclosed, but CEO and managing director, David Lenz, believes this is a strategically important win that will strengthen its presence in the Western Sydney Local Health District.

The Neometals Ltd (ASX: NMT) share price has pushed almost 5% higher to 32.5 cents after the lithium miner surprised the market by declaring a 1 cent per share unfranked dividend. Management has been able to do this thanks to the consistent cash flow being generated by its Mt Marion lithium project. This is in line with the company’s capital management strategy which aims to provide prudent shareholder returns in parallel with the maintenance of a strong balance sheet. Based on its current share price, this dividend equates to a 3% yield.

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Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of and has recommended Telstra 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 Scott Phillips.

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