One area that I think has bright long-term growth prospects is the healthcare sector.
Because of this, I think it is well worth looking at some of the smaller companies in the sector that could grow meaningfully over the next decade.
Three which I think could do this are listed below:
Nanosonics Ltd (ASX: NAN)
Nanosonics is a fast-growing infection control specialist behind the popular trophon EPR product. This product has been growing its installed base at a strong rate over the last few years thanks to being environmentally friendly and regarded as the best in its class. At the end of FY 2018 the total global installed base had grown 25% to 17,740 units, with the vast majority of these installations in North America. While this might seem like a large number, there is still a massive market opportunity globally for the company to pursue over the next decade. Management estimates that it currently commands only a 15% of the overall market opportunity of 120,000 units globally. In addition to this, management has its eyes on other areas of the market which have unmet needs.
Paragon Care Ltd (ASX: PGC)
Paragon Care is a leading provider of integrated services to both the health and aged care markets. Over the last few years the company has been growing at a solid rate due to the winning combination of organic growth and a series of earnings accretive acquisitions. Pleasingly the company is expected to continue its growth through acquisition strategy in FY 2019 thanks to a recent placement of shares with China Pioneer. The China-based medical device distributor invested $45.2 million in the company at a premium of 91 cents per share last month. The proceeds will be used to fund near term acquisitions of complementary healthcare businesses in Australia and New Zealand.
Volpara Health Technologies Ltd (ASX: VHT)
Another small cap healthcare share that I believe has a bright future ahead of it is Volpara Health Technologies. It is a breast imaging analytics and analysis software specialist which has been growing its share of the U.S. breast screening market at an impressive rate. The growing popularity of its product means that management is targeting a 9% share of the market in FY 2019, up from 3.7% at the end of FY 2018. I expect this to lead to further top line growth, especially if it continues to see improvements in its price per screen metric.
Finally, here's another explosive share that I think investors should buy today.
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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 Nanosonics Limited and VOLPARA FPO NZ. The Motley Fool Australia has recommended Paragon Care 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.