I think there are a number of shares at the small end of the market that have significant long term growth potential.
Three which I feel are well worth keeping a close eye on are listed below. Here’s why I like them:
Citadel Group Ltd (ASX: CGL)
Citadel is a specialist in managing information in complex environments through integrating know-how, systems and people to provide information on an anywhere-anytime basis. Although its performance in FY 2019 has been bitterly disappointing, this is partly due to its pivot to become a global software and services company under the Citadel 2.0 strategy. I remain confident that this short term pain will result in a lot of long term gain for shareholders, which could make it worth watching Citadel’s progress in the coming quarters.
PointsBet Holdings Ltd (ASX: PBH)
PointsBet is a corporate bookmaker which recently listed on the Australian share market after raising $75 million through its IPO. I think it could be a great long term investment option due to the massive opportunity the company has in the United States thanks to its innovative sports betting products and services which it provides to clients via a scalable cloud-based technology platform. The company took a big step forward last week when it signed an agreement for digital sports betting and gaming services in the United States with Penn National Gaming. The agreement gives PointsBet the right to develop, own, market and operate, under the authority of the Penn National Gaming operating licenses.
Serko Ltd (ASX: SKO)
Serko is a leading online travel booking and expense management provider in the ANZ region. At the last count, more than 6,000 corporate customers across Asia Pacific, North America, the UK, and Europe were using Serko’s products to help manage their corporate travel programs and make sense of their corporate expenses. One major client the company has is banking giant Australia and New Zealand Banking Group (ASX: ANZ), which I believe is a testament to the quality of its offering. Demand was strong in FY 2019 and this looks set to remain the case in FY 2020 with management providing total operating revenue growth guidance of between 20% and 40%.
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Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia has recommended Citadel Group Ltd, Pointsbet Holdings Ltd, and Serko 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.