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3 future tech stars of the ASX

One area of the market that I think investors ought to consider gaining a little exposure to is the small cap space. After all, the Small Ordinaries index has put on a gain of 19% over the last 12 months, which is over double the 9% gain that has been made by the All Ordinaries.

Three tech shares in the small cap space which I think have a lot of potential are listed below.

Here’s why I think they are worth a closer look:

Citadel Group Ltd (ASX: CGL)

One of my favourite up and coming tech shares on the ASX is Citadel Group. It specialises in information management in complex environments through integrating know-how, systems, and people to provide information on an anywhere-anytime basis. It derives the majority of its revenues from long term managed services and software-as-a-service solutions for wide-ranging companies. Its services include laboratory information system, cyber-attack prevention, and unified communications to name just three.

ELMO Software Ltd (ASX: ELO)

ELMO is another high-quality small cap tech share worth keeping a close eye on. It specialises in cloud-based human resources and payroll management software solutions and has been growing at an impressive rate. It is expected to grow EBITDA by 370% to $5.7 million in FY 2018. And while growth is likely to moderate in FY 2019, I’m still expecting another strong year.

Volpara Health Technologies Ltd (ASX: VHT)

One of my favourite medical technology shares would have to be Volpara Health Technologies. It specialises in breast imaging analytics and analysis software and has seen demand for its software grow at an incredible rate. So much, as of its latest update, the software handled 3.2% of all women screened for breast cancer in the United States. Management is aiming to almost triple its market share in the U.S. in FY 2019 to 9%.

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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 ELMOSFTWRE FPO and VOLPARA FPO NZ. The Motley Fool Australia owns shares of Citadel Group 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 Scott Phillips.

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