I believe there are many shares at the small end of the market with the potential to grow significantly in the future.
Three that I think deserve to at least be on your watchlist today are listed below. Here's why they could be stars of the future:
Capilano Honey Ltd (ASX: CZZ)
This leading honey producer has a market capitalisation of approximately $163 million. The company has its eyes firmly set on the lucrative China market and has been investing heavily in order to boost sales in the country. This included appointing a marketing executive team with a wide breath of experience in marketing health-focussed products to China and cross border ecommerce. If Capilano can crack the China market, then there could be a significant runway for growth ahead of it. I think this makes it worth keeping a close eye on.
Citadel Group Ltd (ASX: CGL)
Citadel is a software company specialising in secure enterprise information management and is currently valued at approximately $300 million. I think Citadel is a very interesting company and one that is certainly deserving of a spot on most watchlists. The company provides education and technology services to help individuals and organisations maximise value, innovation and business outcomes in an information-driven world. Demand for its services has been growing and led to net profit after tax rising 22.8% in the first-half to $6.6 million. And with management confident in its FY 2019 renewals and possessing a strong pipeline of new implementation and managed services contracts, I expect this strong growth could continue for the foreseeable future.
Paragon Care Ltd (ASX: PGC)
This fast-growing provider of integrated services to the health and aged care markets has a market capitalisation of just under $250 million. The company's market value was given a boost last week after it announced a major acquisition that is expected to be highly accretive to earnings. Paragon Care agreed to acquire New Zealand-based specialised medical distribution company REM Systems for a net enterprise value of NZ$54.4 million. As I'm quite bullish on the healthcare sector due to ageing populations, I think Paragon Care could be worth a closer look. Especially considering its shares change hands on a reasonably undemanding 15x estimated forward earnings.
