3 exciting small cap ASX shares to watch in 2022

These small caps could be worth watching…

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At the small end of the Australian share market, there are a number of companies with the potential to grow strongly in the future.

Three that investors may want to get better acquainted with are listed below. Here’s what you need to know about them:

BlueBet Holdings Ltd (ASX: BBT)

The first small cap ASX share to watch is this online sports betting company. Thanks to the increasing popularity of mobile sports betting, BlueBet has been growing at a rapid rate. For example, during the first quarter, the company reported a 63.8% increase in active customers to 39,195 and a 67.4% increase in turnover to $125.9 million. The good news is that management believes it is well positioned to substantially grow its modest market share in Australia and has its eyes on the US market.

Morgans is bullish on BlueBet and has an add rating and $2.60 price target on its shares.

Step One Clothing Limited (ASX: STP)

Another small cap ASX share to watch is Step One. It is a direct-to-consumer online retailer of men’s underwear which raised $81.3 million via an IPO late last year. Some of these funds will be used to support the company’s growth strategies, which include growing Step One’s existing customer base in Australia and the UK and investing in establishing a presence in the enormous US market.

Morgans is positive on Step One despite a recent trading update which fell a touch short of expectations. The broker doesn’t believe its prospects for growth over the long-term are diminished. As a result, its analysts have an add rating and $2.70 price target on its shares

Whispir Ltd (ASX: WSP)

A third and final small cap ASX share to watch is Whispir. It is a software-as-a-service company that provides a communications workflow platform automating interactions between organisations and people. Demand for its offering has been growing strongly over the last couple of years, with a number of blue chips becoming customers. One of those is telco giant Singtel, which is the owner of Optus. Last week it selected Whispir to replace its core SMS notification systems enterprise-wide.

Wilsons is a fan of Whispir and currently has an overweight rating and $4.84 price target on its shares.

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Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. owns and has recommended Whispir Ltd. The Motley Fool Australia has recommended BlueBet Holdings Ltd and Whispir Ltd. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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