Investors with a high tolerance for risk might want to check out these small cap ASX shares in this article.
That's because they have been named as buys and tipped to rise materially from current levels. Let's see what brokers are saying about them:
4DMedical Ltd (ASX: 4DX)
Bell Potter says that 4DMedical is a small cap ASX share to buy right now. It is a software technology company commercialising its patented imaging platform, XV Technology.
It is a four-dimensional lung imaging technology that utilises proven, patented mathematic models and algorithms to convert X-ray scans into quantitative data to enhance the capacity of physicians to manage patients with respiratory diseases and diseases of the lung.
Bell Potter currently has a speculative buy rating and 75 cents price target on its shares. Commenting on the company, the broker said:
The US market alone is estimated at up to 73m lung assessments annually. The technology has the potential to replace each of the existing modalities for the assessment of lung function. The initial target markets are luminary hospital sites in the US and specifically in-patient CT Scans of which there are ~10.9m performed in the US each year.
Adairs Ltd (ASX: ADH)
Analysts at Morgans think that investors should consider buying this homewares retailer's shares. Especially if you're looking for a source of income on top of handsome capital gains. The broker has an add rating and $2.20 price target on the small cap ASX share. It said:
Sales were even harder to come by in FY25 than we'd expected as reduced traffic both in-store and online resulted in a 7% decline on a 52-week basis. This was nearly 2% below our estimate. Costs, however, were well controlled, limiting the comparable decline in EBIT to 15%, 4% below our estimate.
Although the start to FY25 was soft, we have reason to expect sales to pick up as the year goes on. If Adairs can achieve a better sales outcome while maintaining good discipline over pricing and operating costs, FY25 should be a year of positive earnings growth. A dividend yield of 7% underpins our retention of an ADD rating and $2.20 target price.
IPD Group Ltd (ASX: IPG)
A third small cap ASX share for investors to look at is IPD Group. It is a leading distributor of electrical equipment and industrial digital technologies.
Bell Potter is also a fan of the company and has a buy rating and $6.00 price target on its shares. It believes the company is well-placed for growth in the coming years. The broker said:
We continue to view IPD as one of the most attractive ways to play electrification across multiple end markets. The stock remains a top pick among our Industrials coverage.
