One area of the market which I believe is home to a good number of quality options for investors is the mid cap space.
Three top mid cap shares which I believe have the potential to become much bigger in the future are listed below. Here’s why I think they would be great long-term investments:
Bravura Solutions Ltd (ASX: BVS)
One of my favourite options in the mid cap space is this provider of software products and services to the wealth management and funds administration industries. It has been a strong performer again in FY 2019, reporting an impressive 24% increase in revenue to $127.4 million and a 28% lift in EBITDA to $23.8 million in the first half. The key driver of this growth was its Sonata wealth management platform. Demand for Sonata has been increasing strongly and could continue this trend for some time to come thanks to its sizeable global market opportunity. In light of this and potential earnings accretive acquisitions, I think Bravura Solutions would be a great long-term investment.
FlexiGroup Limited (ASX: FXL)
I think that this diversified financial services company would be a great way to gain exposure to the booming buy now, pay later market. This is due to the success of its humm platform which has been signing up some of the biggest retailers in the country such as IKEA. Furthermore, with its shares changing hands at just 9x estimated full year earnings, I think it offers investors a compelling risk/reward. Incidentally, its shares were recently rated as a buy with a $2.04 price target by analysts at Macquarie.
Helloworld Travel Ltd (ASX: HLO)
Another mid cap share which I think would be worth considering is this integrated travel company. A political scandal earlier this year appears to have spooked the market and led to its shares dropping notably lower. I think that this share price weakness should be seen as a buying opportunity. Especially with its shares priced at 15x earnings and management recently reaffirming FY 2019 EBITDA growth guidance of 20.5% to 27%.
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James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. owns shares of Bravura Solutions Ltd and Helloworld Limited. The Motley Fool Australia has recommended Bravura Solutions Ltd, FlexiGroup Limited, and Helloworld 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.