Earlier today I picked out three small cap shares which I think have very bright futures. You can read about them here.
Now I thought I would focus on a couple of shares which are a little larger in size. With market capitalisations approaching $1 billion, I would class these as mid cap ASX shares.
Though, this might not be for long, as I feel these companies have the potential to grow into much larger entities in the future. This could make them great long term investment options.
Here's why I like them:
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Electro Optic Systems (ASX: EOS)
The first mid cap share to look at is Electro Optic Systems. It is an aerospace company and the largest defence exporter in the Southern Hemisphere. It has a highly experienced team, high quality portfolio of products, and long-established partnerships with major global aerospace giants.
I believe a testament to the quality of its offering is a recent announcement by Electro Optic Systems. That announcement revealed that it has entered into contract negotiations with the Australian Government for 251 Remote Weapon Stations and related materiel. Together with its massive backlog of work, I believe this puts the company in a strong position to deliver solid earnings growth over the next few years.
Objective Corporation Limited (ASX: OCL)
Another mid cap ASX share to consider buying is Objective Corporation. It has a suite of software products that help government agencies and financial services organisation respond to information requests, provide secure file sharing, streamline and improve processes, and strengthen corporate governance practices. Given the nature of its offering, demand has remained strong during the pandemic and allowed it to deliver a very strong full year result.
Last week Objective revealed a 22% increase in unaudited net profit after tax to $11 million for FY 2020. This was driven by a 21% lift in annual recurring revenue to $56.6 million, which now represents 75% of total revenue. Next year the company's growth looks set to continue and be given an additional boost from the recent acquisition of government regtech solution specialist Itree for $18.5 million. Management certainly believes this will be the case and expects "a material lift in revenue and profitability."
