If you're a fan of small caps, then you're in luck because there are a number of exciting ones with huge potential on the Australian share market.
Listed below are two small cap ASX shares that analysts rate highly. Here's what you need to know about them:
Image source: Getty Images
Airtasker Ltd (ASX: ART)
The first small cap ASX share to consider is Airtasker. It is a growing online marketplace for local services which has an estimated $600 billion global total addressable market across Australia, the US, and the UK.
Management estimates that it has only captured a 0.3% slice of the Australian market at present, which clearly gives it a long runway for growth over the next decade and beyond in just the domestic market. And with the US market 10 times larger, there's a mouth-watering opportunity for Airtasker over there.
Morgans is very positive on Airtasker. It highlights that the company's product works for both sides of the marketplace, has attractive unit dynamics with healthy gross and contribution margins, an enormous TAM in the early stages of ecommerce adoption, and a large international expansion opportunity.
The broker has an add rating and $1.27 price target on the company's shares.
Whispir Ltd (ASX: WSP)
Another small cap share to watch is Whispir. It is a software-as-a-service communications workflow platform provider. Whispir's platform allows businesses and governments to deliver actionable two-way interactions at scale using automated multi-channel communication workflows.
Whispir has been growing at a strong rate over the last few years. This led to the company's Annualised Recurring Revenue (ARR) growing 26.6% during the first half to $60 million. And while this is a large number, it is still well-short of its market opportunity. For example, management estimates that it has a TAM of US$4.7 billion in the just United States.
Ord Minnett is a fan of the company and has a buy rating and $3.45 price target on its shares.
