Following earnings season, two ASX small-caps have received positive outlooks from the team at Morgans.
Based on current prices and the projections from Morgans, these small-cap companies could rise roughly 60%.
While ASX small caps come with increased volatility, there can also be increased upside.
Here are two that could be worth monitoring.
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Eureka Group Holdings Ltd (ASX: EGH)
Eureka Group Holdings provides rental accommodation for seniors and disability pensioners in safe and well-managed environments.
Year to date, its share price has risen 10.4%.
The company recently released H1 FY26 results.
According to Morgans, the small cap's reaffirmed FY26 guidance will see EBITDA grow 20% to 25% (vs pcp) and underlying EPS grow 7.5% to 10%.
This is a result of a 5% to 7% same-store rent growth and full earnings contributions from the $80m of assets acquired since CY25.
In EGH we see sector leading earnings growth, Government backed revenues, and attractive valuation (trading at NTA). The return outlook, relative to risk, remains attractive as the secure income stream and valuation discount mitigates some of the risks, whilst the modest market cap means acquisitions can materially improve earnings.
Based on this guidance, the broker maintained its buy recommendation and $0.85 price target.
Yesterday's closing price of $0.53 indicates a 60% upside.
Betr Entertainment Ltd (ASX: BBT)
The company provides sports and race betting services in Australia. Its main product lines include sports, horse racing, greyhound racing, harness racing, and on-track wagering.
It is aiming to expand its services into the US market as more US states change their legislation to permit legal access to online wagering services.
In 2026, its stock price has risen by approximately 16.6%.
It also reported 1H FY26 results during February.
Following the results, the team at Morgans said the interim result was impacted by an unusually unfavourable trading period for bookmakers, particularly across racing during the peak Spring Carnival.
While 2Q26 margins were heavily affected by customer-friendly outcomes, trading has normalised since December, and the business enters 2H26 with improved operating leverage following the completion of its major brand and marketing investment phase. Notwithstanding recent earnings pressure, we believe the company's 2H26 and FY27 guidance is achievable, supported by normalising gross margins, improved promotional efficiency and a more disciplined cost base.
As a result, the broker reduced earnings forecasts across FY26 to 27F.
It has maintained a buy recommendation and lowered its price target to $0.40.
Despite lowering its target price, there remains approximately 63% upside based on yesterday's closing price of $0.245.
