If you are looking for investment ideas, then it could pay to listen to what Bell Potter is saying.
That's because the broker has just released its latest top Australian picks for the month of September.
It notes that its panel of favoured small cap Australian equities are the ones that it believes offer attractive returns over the long term.
Three that make the list this month are named below. Here's why it is bullish on them:
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DroneShield Ltd (ASX: DRO)
Bell Potter remains positive on this counterdrone technology company and has named it on its panel again in September.
The broker believes that DroneShield is well-placed for growth over the coming years. This is due to increasing demand for counterdrone technology from military and intelligence customers across the globe. It commented:
DroneShield is an Australian defence manufacturer specialising in counterdrone technology. DRO provides an end-to-end counter-drone solution that integrates proprietary artificial intelligence software with a suite of hardware products utilised to detect, identify and defeat aerial, ground and maritime threats.
The company's products are largely in-house technology and include handheld, vehicular and fixed installations. DRO's customers primarily include military and intelligence, as well as law enforcement, critical infrastructure and commercial parties globally.
Cedar Woods Properties Ltd (ASX: CWP)
Another ASX share that Bell Potter is very bullish on is property developer Cedar Woods.
It likes the company due to its strong track record and its exposure to Australia's chronic housing shortage. It believes the latter leaves it well-positioned for growth in the near term. It explains:
Cedar Woods is a residential property developer based in Perth, WA. The group also develop and own commercial property where they see a value add to their residential projects. CWP has a 35-year track record of delivering earnings and a proven management team. CWP has a substantial pipeline of residential projects amidst Australia's extreme housing shortage, record presales, and positive forward commentary from a historically conservative management team.
We are attracted to the current valuation – trading a discount to its long-term average NTA premium of +30% and at a forward PE of 11x, which undervalues its double-digit growth profile.
Integral Diagnostics Ltd (ASX: IDX)
A third ASX share that has been given the seal of approval is diagnostic imaging company Integral Diagnostics.
The broker believes that its recent merger with Capitol Health has been a bit of game-changer. And with opportunities to grow organically and through acquisitions, Bell Potter believes it has a strong outlook. It said:
The merger between Integral Diagnostics and Capitol Health results in a diagnostic imaging (DI) company which operates 151 clinics throughout Australia. Its strongest presence will be within Victoria and Queensland (67 & 41 locations respectively) with minor penetration in the other States.
The company offers a range of imaging modalities through its clinics with the largest contribution to revenue from CT (31%) followed by US (24%), MRI (13%) and X-Ray / Diagnostic Radiology (11%), and Nuclear Medicine PET (5%). The growth strategy has centred around a combination of greenfield & brownfield investments and M&A opportunities.
