Investing in ASX small caps can be a high-risk, high-reward decision.
Many small-cap companies are depending on clinical trial success, public or private funding, and more to generate consistent profits.
Because of these risks, share price volatility is common amongst this asset class.
However, the team at Bell Potter is optimistic about two ASX small caps following important results.
If you are considering adding a speculative small-cap stock to your portfolio, these two could be worth watching.
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Biome Australia Ltd (ASX: BIO)
Biome Australia (BIO) develops and commercialises clinically backed innovative live biotherapeutics (probiotics), marketing 18 products under the 'Activated Probiotics' Brand.
The company made headlines earlier this month after it struck a distribution deal for its probiotic products in Canada.
This sent its share price 8% higher on February 2nd.
Since then, its share price has retreated; however, yesterday, it jumped 6% on first-half FY26 results.
The company reported net profit of $1.18m, up 172% from the prior period, record H1 EBITDA of $1.47m, and record half-year sales revenue of $12.40m, up ~40%.
Following this announcement, Bell Potter provided updated guidance on the ASX small-cap stock.
The broker pointed out that the company maintained sales momentum in Australian Pharmacy as well as introduced new retail channels with Mecca (beauty vertical) and Go Vita (health food).
The broker maintained its buy recommendation and $1 price target.
From yesterday's closing price of $0.43, this indicates an upside of approximately 132.6%.
We look forward to the FY26 result, in which we expect to see further improvement in 2H26 sales and margins and more colour on geographic segmentation. Given 1 yr fwd multiples are now c.13x, but the FCF yield is >6% and ROE is >40%, BIO screens positively for long-term fundamental investors.
EMvision Medical Devices Ltd (ASX: EMV)
EMvision Medical Devices is an Australian medical device company. The company is focused on research and development and the commercialisation of neurodiagnostic technology for stroke diagnosis and monitoring.
Yesterday, the company released its half-year report. Following this announcement, Bell Potter released an updated outlook on the ASX small-cap stock.
Bell Potter reinforced that CY26 is a pivotal year for the company, with an expected successful completion of the current validation trial, leading to potential FDA De Novo clearance in 4Q CY26/1Q CY27.
This will be a critical value inflection point for EMV and is expected to be supported by the various First Responder feasibility studies, with updates during CY26.
Bell Potter maintained its speculative buy recommendation on the company, along with a price target of $3.150.
From yesterday's closing price of $1.775, this indicates an upside of 77.5%.
