One of my favourite areas of the market to look for long-term investment options is the mid cap space.
At this side of the market I believe there are a good number of quality companies that have the potential to grow into large caps over the next decade.
Three top mid cap shares that I would buy in March are listed below:
Bravura Solutions Ltd (ASX: BVS)
There are a lot of options for investors in the fintech industry, but my pick of the group would have to be this provider of software products and services to the wealth management and funds administration industries. Thanks to the ongoing success of its Sonata platform, Bravura delivered a 28% increase in half year EBITDA to $23.8 million last month. The good news is that management still believes that it has a long runway for growth. It said: "Strong growth, increasing scale and greater efficiency, are driving increased operating leverage. Following significant product investment and the accumulation of deep market knowledge and expertise, Bravura is well positioned to continue to capitalise on the significant market opportunity."
Citadel Group Ltd (ASX: CGL)
Citadel Group is a leading software and services company that specialises in secure information management in complex environments. Although its first half result was a touch underwhelming, I was pleased to see the company growing in all the right areas. At present Citadel is transitioning its sales focus towards scalable solutions that provide annuity revenue streams. So while total half year revenue only increased 5.5%, it was great to see its SaaS revenue increase 39.1% to $16.8 million during the half. This segment now accounts for just over a third of total revenue and is likely to be a key driver of growth over the next decade.
NEXTDC Ltd (ASX: NXT)
NEXTDC is one of Australia's leading data centre operators with eight centres across five capital cities. Through these centres the company provides enterprise-class colocation services to local and international organisations. In the first half of FY 2019 the company experienced strong demand for its services, leading to contracted utilisation increasing 28% or 11.1MW to 50.4MW and interconnections rising 34% to 9,982. This ultimately led to a 26% increase in underlying EBITDA to $42.2 million. With the cloud computing boom gathering pace, I believe this strong growth can continue for some time to come.
