If you're wanting to invest in the small side of the Australian share market, then the small caps listed below could be worth a closer look.
Both of these shares have been named as buys and tipped for big things in the future. Here's why these small cap ASX shares could be worth adding to your watchlist:
Catapult Group International Ltd (ASX: CAT)
The first small cap to look at is Catapult. It is a global sports analytics company that provides elite sporting organisations and athletes with real time data and analytics to monitor and measure athletes.
Catapult's products are used by many of the biggest and most successful sports teams in the world. This includes all 32 NFL teams, Chelsea FC, Bayern Munich, Real Madrid, and Cricket Australia, to name just a few.
The company has rebounded strongly since the height of the pandemic. This led to Catapult reporting a 13% increase in revenue to $37.5 million during the first half of FY 2022. This was driven by 29% growth in subscription revenue, which reflects Catapult's strategic shift to a focus on high quality recurring revenue SaaS deals.
Jefferies is very positive on Catapult. It currently has a buy rating and $3.00 price target on the company's shares.
Hipages Group Holdings Ltd (ASX: HPG)
Another small cap ASX share to look at is Hipages. It is a leading Australian-based online platform and software as a service (SaaS) provider connecting consumers with trusted tradies.
In FY 2021, it was on form and delivered a 22% increase in revenue to $55.8 million. Pleasingly, it has built on this in FY 2022, with the company reporting a 12% increase in half year revenue to $30.1 million. This was despite Hipages battling lockdowns during the period.
Another recent positive has been the strengthening of its ANZ market leadership position with the acquisition of New Zealand-based Builderscrack and the strategic investment in Bricks + Agent. This has increased its total addressable market (TAM) to ~$136 billion.
Goldman Sachs is bullish on its future and has a buy rating and $3.60 price target on its shares.
It commented: "We believe HPG presents a compelling long term growth opportunity as it scales to become the leading trade services marketplace in Australia."
