The S&P/ASX Small Ords Index (ASX: XSO) is down 0.1% on Friday but up 16% over the past 12 months.
By comparison, the S&P/ASX All Ords Index (ASX: XAO) is up 0.07% today and has risen 11% over the past year.
The Small Ords index tracks ASX companies ranked 101-300 by market capitalisation. The ASX All Ords tracks the top 500.
ASX small-cap shares typically have market caps between a few hundred million dollars and $2 billion.
Here are two ASX small-cap shares that the experts rate as buys, with a potential upside of 100% each over the next 12 months.
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Starpharma Holdings Ltd (ASX: SPL)
The Starpharma share price is steady at 41 cents, which reflects a more than 300% gain over the past 12 months.
Starpharma is an Australian biotech that develops drug delivery systems using proprietary polymers called dendrimers.
These nanoscale molecules help medicines work better in the body.
Starpharma licenses its drug delivery technology to large pharmaceutical companies. It also develops its own anti-infection products.
PAC Partners has a buy rating on this ASX small-cap healthcare share.
The broker forecasts higher growth in partnerships and over-the-counter revenue over the next four years.
PAC Partners says it has a "high risk" 12-month price target of between 80 cents and $1 on this ASX small-cap share.
This suggests a possible minimum capital gain of 100% over the next 12 months.
PAC Partners commented:
Starpharma Holdings Limited (ASX:SPL) will start human clinical trials of its novel radiotherapy drug for a solid cancer target by the end of 2026.
This in-house project opens up SPL dendrimer applications beyond the Genentech, medicxi and RAD.ASX partnered projects.
This additional radiotherapy application is well timed with just three FDA approved first generation radiotherapy cancer drugs (e.g.: 2024 Novartis' Pluvicto for prostate cancer.)
SPL has a pipeline of 10 agents and six targets.
SPL only 100% funds this one radiotherapy trial, and has global partners funding the rest (with fees to SPL for service).
Verbrec Ltd (ASX: VBC)
This ASX small-cap share is trading for 21 cents, down 4.55% today and up 147% over the past 12 months.
Verbrec provides engineering, asset management, and infrastructure services and technology to a variety of industries.
These include energy, mining, manufacturing, and defence industries in Australia, New Zealand, PNG, and the Pacific Islands.
Earlier this month, Verbrec reported revenue growth of 18.5% to $46.1 million and EBITDA growth of 135.3% to $4 million for 1H FY26.
During the half, Verbrec sold its non-core competency training segment for $11.2 million and acquired Alliance Automation for $5.5 million.
RaaS Advisory, which specialises in small-cap research, gives this ASX industrials share a valuation of 44 cents apiece.
This implies that Verbrec shares could double over the period ahead.
RaaS Advisory said:
The combined Verbrec and Alliance Automation business strengthens the group engineering offering and as a result work-in-hand and the opportunity pipeline have both grown by more than 50%.
Management released FY26 guidance for the new-look business for revenue of $110m-$120m and EBITDA of $8m- $10m.
Management has delivered a strong turnaround of the existing engineering business over the past two to three years and, in our view, the AA acquisition may prove to be a pivotal point in value creation over the next couple of years.
