It's important for investors not to panic, as history shows the market will recover. 

When markets fall, it does create buying opportunities for investors. 

For those looking to monitor small-caps or penny stocks, here are three that have drawn positive outlooks from brokers. 

Paragon Care Ltd (ASX: PGC)

Paragon Care conducts its business largely within the Australian healthcare sector and in 7 countries across Asia. The core business is distribution of pharmaceutical medicines, consumables and capital products. 

Following earnings results released last week, the team at Bell Potter released updated guidance on the healthcare stock.

The broker said it is cautiously optimistic on the full year EBITDA. 

It said the two cornerstones of long term earnings growth for Paragon are the expanding footprint in Medical Technology particularly in Asia and the expanding footprint in pharmacy distribution. 

At the recent half year result Asia Med Tech revenues grew 33% at gross profit margin of 45%. In the pharmacy wholesale business, the underlying growth rate (which excludes Infinity group trading from the prior period) was ~6%. The company estimates it has ~10% market share currently with aspirations to grow to 15%.

Included in the report from Bell Potter was a buy recommendation and price target of $0.30. 

This indicates a potential upside of 46% for this penny stock from yesterday's closing price. 

EBR Systems Inc (ASX: EBR)

EBR systems is another penny stock drawing a positive outlook from Bell Potter. 

The company is primarily engaged in treatment for patients suffering from cardiac rhythm diseases by developing therapies using wireless cardiac stimulation. 

The Wise CRT System uses proprietary wireless technology to deliver pacing stimulation directly inside the left ventricle of the heart.

Following recent earnings results, Bell Potter adjusted its outlook on this penny stock, including a revised price target of $2.00. 

The broker maintained its buy recommendation. 

EBR systems closed trading yesterday at $0.58. 

Airtasker Ltd (ASX: ART)

This ASX penny stock is an online platform that connects people wanting to outsource tasks with people who are willing to do them for a fee. 

Typical tasks include home cleaning, removal services, handyman jobs, admin work, photography, graphic design, and collection services.

It closed trading yesterday at $0.22, however it has attracted a buy rating and $0.51 price target from Morgans after it posted healthy half-year results last month. 

The post 3 ASX penny stocks drawing positive ratings from experts appeared first on The Motley Fool Australia.

But which small caps could be worth considering if your risk tolerance allows for it?

Well, listed below are three that Morgans recently rated as buys and is tipping to rise strongly from current levels. Here's what you need to know about them:

Airtasker Ltd (ASX: ART)

This small job listings company could be a small-cap ASX share to buy according to the broker.

It currently has a buy rating and 51 cents price target on its shares. This is more than double its current share price of 23 cents. It said:

It was a resilient 1H26 result for Airtasker, delivering ~13.5% group revenue growth to ~A$29m. Its established marketplaces saw EBITDA growth of ~11% to ~A$15m. Domestic metrics appear sound (e.g. uptick in booked tasks and brand salience), and we remain pleased with the momentum seen in ART's offshore marketplace build-out (UK/US revenue +85% and 380% on the pcp respectively).

We make minor adjustments to our topline forecasts (details below), we also include the additional $5m cash marketing costs into our 2H numbers along with the recent capital raise. Our price target is lowered to A$0.51. Buy maintained.

Meeka Metals Ltd (ASX: MEK)

Another small-cap ASX share that has caught the eye of Morgans is gold miner Meeka Metals.

Morgans was pleased with management's production growth plans and is expecting a "step-change in output" in the fourth quarter.

As a result, it has put a buy rating and 39 cents price target on its shares. This is also more than double its current share price of 17 cents. It said:

MEK announced an expansion to 800ktpa (equivalent ounce basis) via ore sorting, requiring modest capex of A$6m with commissioning scheduled for Q1FY27. Ore sorting effectively near doubles Andy Well underground head grade, lifting our annual production forecasts by an average of 7% from FY27 onwards. Open Pit throughput has tracked below DFS forecasts due to moisture-driven variability in open pit ore, an issue expected to resolve with underground stope commencement in 4QFY26.

We revise our FY26 production forecast to 37.6koz Au (from 40.2koz), this is below the DFS guidance. We maintain our BUY rating and A$0.39ps price target, acknowledging near-term production softness may weigh on the 3Q result ahead of an anticipated step-change in output in 4Q.

Readytech Holdings Ltd (ASX: RDY)

A final small-cap ASX share that Morgans rates highly is enterprise software provider Readytech.

Although it has downgraded its earnings estimates to reflect its revised guidance, the broker remains positive. This is due to its robust pipeline and potential near-term catalysts.

Morgans has a speculative buy rating and $2.20 price target on its shares. This implies potential upside of 85% for investors over the next 12 months. It said:

RDY's 1H26 result and revised outlook came in softer than expected, with Underlying EBITDA of $17.5m / Cash EBITDA of $7.5m ~6% behind MorgF. Whilst RDY's enterprise strategy remains on track, the group indicated that increased churn in 1H26 along with more protracted implementation/sale conversion have led to an FY26 guidance downgrade and the withdrawal of its longer-term targets.

Whilst we downgrade our FY26-27 EBITDA forecasts by 10-20% reflecting revised guidance, given RDY's robust pipeline, potential catalysts (VIC TAFE decision and likely increased corporate appeal), we move to a SPECULATIVE BUY rating, with a revised price target of $2.20/sh (previously $3.00/sh).

The post Morgans says these small-cap ASX shares could rise 85%+ appeared first on The Motley Fool Australia.

Here's why the broker currently rates them as buys:

Airtasker Ltd (ASX: ART)

Morgans was pleased with this small jobs marketplace provider's performance in the first half of FY 2026. It notes that the company delivered double-digit revenue growth thanks to solid performances at home and overseas.

In response, the broker has retained its buy rating with a trimmed price target of 51 cents. It said:

It was a resilient 1H26 result for Airtasker, delivering ~13.5% group revenue growth to ~A$29m. Its established marketplaces saw EBITDA growth of ~11% to ~A$15m. Domestic metrics appear sound (e.g. uptick in booked tasks and brand salience), and we remain pleased with the momentum seen in ART's offshore marketplace build-out (UK/US revenue +85% and 380% on the pcp respectively).

We make minor adjustments to our topline forecasts (details below), we also include the additional $5m cash marketing costs into our 2H numbers along with the recent capital raise. Our price target is lowered to A$0.51. Buy maintained.

Epiminder Ltd (ASX: EPI)

Another small-cap ASX share that has been given the thumbs up by Morgans is Epiminder.

Morgans notes that there were no surprises with its half-year results, with everything in line with expectations. As a result, the broker has reaffirmed its speculative buy rating and $2.33 price target on its shares. It said:

Debut 1HFY26 results held no material surprises relative to IPO disclosures, and are more strategically important than financially complex. Since listing, EPI has secured a favourable Medicare reimbursement ruling, completed the first US Minder implant and signed nine Tier-1 US centres for DETECT, albeit enrolment remains early (3 patients to date).

Cash runway is confirmed through DETECT completion and G1 development into CY28, with execution on enrolment cadence now the key swing factor for sentiment. We make no changes to our FY26-28 forecasts or A$2.33 DCF-based target price. SPECULATIVE BUY rating maintained.

SomnoMed Ltd (ASX: SOM)

A third small-cap ASX share that is being tipped as a buy by Morgans is SomnoMed.

It highlights that the sleep disorder treatment company has started FY 2026 positively and is in a good position to achieve its full-year guidance.

As a result, it has retained its speculative buy rating and 99 cents price target on its shares. It commented:

SOM's 1H26 result places the company in a strong position to deliver at least the low end of its FY26 guidance, with clear upside potential. The half delivered solid double-digit revenue growth, meaningful operating leverage and significantly improved manufacturing efficiency, giving SOM a structurally strong base heading into 2H.

With around half of revenue and the majority of EBITDA already achieved in 1H, the 2H requirements to meet both the low and high ends of guidance appear modest and achievable. Continued momentum across Europe and North America, combined with expanded capacity and improved turnaround times, provides a credible pathway for SOM to finish the year toward the upper end of its range if current trends persist. No change to valuation or positive outlook but note upside risk as 2H progresses.

The post Morgans names 3 small-cap ASX shares to buy appeared first on The Motley Fool Australia.

Businesses that deal in physical products and services can be limited by not having enough warehouses, stores, logistics or manufacturing capabilities. Software companies don't necessarily face those sorts of physical growth limitations. Software is very replicable.

Instead, software usually has low costs, enabling the business to have a strong gross profit margin. Gross profit can then be used for growth activities (such as marketing or software investment).

There are plenty of compelling businesses to consider and I'm going to focus on two investments.

Airtasker Ltd (ASX: ART)

Airtasker describes itself as Australia's leading online marketplace for local services, connecting people and businesses who need working doing with people who want to work.

The company certainly ticks the box when it comes to a high gross profit, with the margin above 90%. This is extremely useful, in my view, due to how this can lead to good growth of earnings before interest, tax, depreciation and amortisation (EBITDA).

The ASX tech share continues to grow in Australia at a good pace – in the first quarter of FY26, Airtasker marketplace revenue grew 20.5%.

A key part of the company's growth plans is expanding in the UK and the US, which are larger markets than Australia. While these two markets are much smaller than the Australian division at this stage, they are growing rapidly.

In the first quarter of FY26, Airtasker UK revenue jumped 83.3% and Airtasker USA revenue soared 609.1%. Airtasker continues to put significant efforts and financial commitments into investing for growth in the UK and the USA. 

Siteminder Ltd (ASX: SDR)

Siteminder may be one of the most exciting ASX tech shares around, in my view.

The company provides software for hotels around the world so they can generate as much revenue as possible by connecting with booking platforms, changing prices and hotel operations.

There are tens of thousands of hotels around the world, so Siteminder has a large addressable market to aim at. Pleasingly, it continues to win more subscribers each year, with larger being a greater focus in recent times.

Siteminder has a longer-term goal of growing its revenue annually by 30%, which is an excellent growth rate to help the business become much larger at a fast pace.

Thanks to the software nature of what it provides subscribers, the business is seeing a rising gross profit margin, operating profit (EBITDA) margin, free cash flow margin and net profit margin.

The company is focused on scaling its growth through the smart platform adoption, product expansion and global market penetration. The smart platform remains early in its adoption and monetisation curve, providing significant long-term potential across its global footprint.

If the ASX tech share continues growing revenue rapidly, then it has a very strong future ahead.

The post Investors should put these 2 top ASX tech shares on the watchlist appeared first on The Motley Fool Australia.

The company, which operates a platform where people can post and accept jobs such as putting together furniture or running errands, said it had received binding commitments for a $10 million capital raise to bolster its expansion in the US and the UK.

Strong backing from partners

The placement of new shares received strong support from the company's largest shareholder, Exto Partners, Airtasker said, as well as the US company iHeartMedia, with which it had expanded an existing agreement in the US.

Airtasker said the funds would go towards growing the business.

The $10.0 million raised will be used to fund a disciplined program of targeted marketing investments in the US and UK, to provide Airtasker with additional balance sheet flexibility to invest alongside media partners in Airtasker's US and UK subsidiaries and/or to settle media partnership agreements.  

iHeartmedia's investment in the placement builds on a US$5 million partnership struck in August 2024, "through which iHeartMedia provides Airtasker USA with access to significant media and advertising resources to accelerate Airtasker USA's expansion'', the company said.

Airtasker USA has also entered into an agreement today to expand the strategic partnership with iHeartMedia, providing Airtasker with an additional US$5.0 million in media and advertising resources to accelerate growth in the US.

The strategic partnership will provide Airtasker USA with US$5 million in media and advertising inventory in exchange for a convertible note over Airtasker shares.

Platform a great innovation

iHeartMedia Executive Vice President of Ventures, David Ellis, said the Airtasker platform was a game-changer.

Airtasker's strength in Australia shows how a fundamentally better marketplace can reshape consumer behaviour. As the company accelerates in the US, we see a clear opportunity to redefine expectations and win the category through innovation and a strong go-to-market plan.

Airtasker Chief Executive Officer Tim Fung said the company was already seeing the benefits of collaborating with iHeartMedia since striking its original deal in August last year.

Since launching our strategic partnership last year, we've already seen the power of the iHeartMedia platform to accelerate our growth, helping us to scale from close to a standing start to hitting a $7.5 million gross marketplace volume annualised run rate in June this year. With an audience of over 276 million users every month, being the no. 1 podcast publisher in the world and creating epic events like the iHeartRadio Music Festival and Awards – this strategic partnership will give us the resources we need to take Airtasker's mission to the biggest market in the world.

Airtasker shares fell 7.5% on Monday morning to be changing hands for 31 cents, after the company announced the capital raise, which was priced at 30 cents. Airtasker was valued at $152.4 million at the close of trade on Friday.

The post Why are Airtasker shares dropping today? appeared first on The Motley Fool Australia.

Due to their intangible nature, technology companies don't have to pay certain costs that physical product businesses do such as stores, warehouses, shipping and so on.

When a business has an incredibly high profit margin, a lot of the new revenue can instantly translate into gross profit, operating profit (EBITDA) and net profit. That's why the following two ASX tech share investments are so appealing.

Airtasker Ltd (ASX: ART)

Airtasker provides a platform that allows someone who needs a job done to advertise it, and then individuals and businesses (taskers) can offer to do the work.

There is a huge array of services available such as accounting, beauticians, various trades, building and construction services, car service, carpet cleaning, pet care, various types of lessons, florist, removalist, furniture assembly, garden and many more.

The business has a gross profit margin of more than 90%, so revenue growth is extremely profitable for the business. In FY25, Airtasker marketplace revenue grew 18.3% year-over-year, and its Australia marketplaces generated $15.2 million of cash flow after covering global head office expenses.

It's also exciting to see that the company is making progress in the international markets of the UK and US. While these are still small markets for Airtasker, they're growing at a fast pace – in FY25, UK revenue rose 111% and US revenue surged 422%.

Airtasker Australia is expecting to deliver solid double-digit revenue growth in FY26, with an acceleration of the growth trajectory in the US and UK, which bodes well for the ASX tech share.

BetaShares S&P/ASX Australian Technology ETF (ASX: ATEC)

The larger ASX tech shares are mostly trading at high prices, reflecting the market's belief in their growth potential.

It may be tricky to know which one of them to invest in, so why not invest in an exchange-traded fund (ETF) that allows us to invest in them all at once?

The ATEC ETF is invested in a total of 45 names, including Computershare Ltd (ASX: CPU), Xero Ltd (ASX: XRO), Pro Medicus Ltd (ASX: PME), CAR Group Ltd (ASX: CAR), WiseTech Global Ltd (ASX: WTC) and Life360 Inc (ASX: 360).

While all of the businesses are under the umbrella of 'technology', they provide very different services, giving investors diversification.

Past performance is not a guarantee of future performance, but the ATEC ETF has returned an average of 17.25% per year since inception in March 2020. I'm not expecting the next five years to be as strong, but things are looking positive for the fund as the businesses collectively continue growing.

The post Investors should put these 2 top ASX tech shares on the watchlist appeared first on The Motley Fool Australia.

I'd suggest it's not the businesses growing revenue at 3% or 4% year that will deliver huge gains over the long-term. Instead, I'd look at businesses that are growing revenue at a good pace and can deliver rising profit margins.

With that in mind, I'm going to highlight two ASX share investments that I'm predicting will deliver significant earnings growth over the next ten years.

Airtasker Ltd (ASX: ART)

Airtasker offers a platform where people can advertise tasks that need doing, while individuals and businesses (taskers) can offer to do the work.

Virtually any job you can think of can be advertised on the platform such as pest control, delivery, furniture assembly, removalists, photography, accounting and bookkeeping, various handyman jobs, plumbing and so on.

One of the things that appeals to me the most about the business is its incredibly high gross profit margin of above 90%. It means that virtually all of the revenue it generates can be turned into usable gross profit. In FY25, Airtasker marketplace revenue grew by 18.3%, which is a strong growth rate for the top line. In a decade, I think its revenue could be significantly higher.

The other thing that excites me about the ASX share is its progress in the UK and the US, which are two markets that are much larger than Australia. In FY25, UK revenue rose 111% and US revenue soared 422%. For now, the revenue from those two countries is a small part of the overall revenue base.

Betashares Global Cybersecurity ETF (ASX: HACK)

This is an exchange-traded fund (ETF) that allows Aussie investors to gain exposure to the global cybersecurity sector, with both leaders and emerging players.

The world has seen significant growth of cybercriminal activity in recent years as the bad guys become more sophisticated and use more advanced tactics.

There are a number of impressive businesses within the portfolio that perform an array of tasks for protecting users, companies and data from cybercrime. The biggest positions in the portfolio include Broadcom, Crowdstrike, Palo Alto Networks, Infosys, Cisco Systems, Thales, Cyberark, Fortinet, Check Point Software and Cloudflare.

I'm calling this fund an ASX share because we can buy it on the ASX.

In the coming years, I'm expecting more citizens of the world to take up digital banking, e-commerce, digital taxation lodgements, online education and work, lifting demand for cybersecurity around the world.

These businesses have collectively grown their profits significantly over the last several years, helping the HACK ETF deliver an average return per year of 18% since August 2016.

The post 2 ASX shares to buy and hold for the next decade appeared first on The Motley Fool Australia.

But which small cap ASX shares could be buys? Let's take a look at three that the team at Morgans is bullish on this month. They are as follows:

Airtasker Ltd (ASX: ART)

This small jobs marketplace provider could be a small cap ASX share to buy according to Morgans.

It was pleased with its performance in FY 2025 and believes that it is well-placed for further growth. Especially given the strong momentum it is experiencing in overseas markets. It said:

Airtasker's (ART) FY25 result was solid overall in our view, having achieved group revenue growth of A$52.6m (+13% on pcp), establishing strong momentum in its offshore marketplaces and achieving its FY25 guidance of being free cash flow positive for the full year.

We make only minor adjustments to our topline estimates across the forecast period (~-1%), however we still assume a 3 year ~15% revenue CAGR. Our DCF/multiples derived price target is unchanged at A$0.55. Buy maintained.

betr Entertainment Ltd (ASX: BBT)

This small cap betting company could be one to buy according to the broker.

It was pleased with its transformative year in FY 2025, which saw turnover rocket and its first profit.

In response, Morgans has boosted its estimates and is expecting another profit in FY 2026. It said:

BETR Entertainment (BBT) delivered a transformative FY25, marking its first full year of profitability underpinned by strong organic growth and seamless integration of acquisitions. Turnover rose 140% yoy to $1.42bn, with Gross Win up 147% to $196.2m and Net Win up 133% to $147.8m. Net Win margins held firm at 10.4% despite the onboarding of lower-margin customers, supported by structural margin gains from consolidating both businesses on the BBT platform.

Normalised EBITDA was $7.2m, a sharp rebound from $0.2m in FY24 and in line with expectations. With the release of results, we lift our underlying EBITDA and NPAT forecasts to $11.2m and $8.8m respectively in FY26. We retain our Buy recommendation, with our 12-month price target increased to $0.43 (from $0.42).

Clearview Wealth Ltd (ASX: CVW)

Finally, this life insurance company has been named as a small cap ASX share to buy by Morgans.

While its profits fell in FY 2025, it was largely in line with what the broker was expecting.

As a result, it continues to see plenty of value on offer with its shares at current levels. It explains:

CVW's FY25 group Underlying NPAT of A$32.3m (-8% on the pcp) was broadly in line with MorgansE (A$31.7m). Overall we saw this as a good result. CVW's recovery from the 1Q25 claims spike continued in 2H25 and FY26 NPAT guidance (at the mid-point) implies ~+40% growth on the pcp. We lower our CVW FY26F/FY27F reported EPS by -1%/-2% driven by slightly more conservative earnings and buyback assumptions. Our earnings changes are offset by a valuation roll-forward, with our price target largely unaltered at A$0.69 (previously A$0.68). With significant upside existing to our current price target (~+40%), we maintain our BUY recommendation.

The post Morgans names 3 small cap ASX shares to buy appeared first on The Motley Fool Australia.

Part of the difficulty in finding great investments is picking them at attractive valuations. Plenty of high-quality businesses are already priced for a lot of growth, so it's worthwhile being mindful of how realistic it is an investment could perform. That's why I like to invest in businesses that haven't reached the end of their growth journey.

I believe these two investments have a lot of growth potential, but aren't priced too highly for how big they could become.

Airtasker Ltd (ASX: ART)

Airtasker operates a platform that enables people to advertise tasks that need doing and allows taskers to find work. There is a huge array of jobs that can be advertised on the platform such as accountancy, removalists, photography, furniture assembly, pest control, delivery and plenty more.

The compelling ASX share earns most of its revenue in Australia, though it is also rapidly growing in the UK and US, partly thanks to advertising arrangements with media companies in those countries.

In the FY25 fourth quarter update, it said Airtasker marketplace revenue grew by 28.9% to $11.7 million, with Airtasker Australia growth of 20.7% to $10.3 million. On a full-year basis, Airtasker Australia revenue grew 13.5% to $41.6 million, despite the challenged economy.

UK FY25 fourth quarter revenue rose 104.8% year-over-year to £512,000, with 36.8% growth in the number of posted tasks. It saw ongoing market penetration in Birmingham and Manchester. The US saw quarterly revenue increase 754.5% year-over-year to US$188,000.

The business said in its fourth quarter update its Australian marketplaces delivered around $4.8 million of cash flow after all global head office expenses.

This compelling ASX share has a very high gross profit margin, meaning nearly all the new revenue is turning into gross profit, which it can then re-invest into more growth spending.

In three years, I think this business could be significantly larger and more profitable.

WCM Quality Global Growth Fund (ASX: WCMQ)

This is an exchange-traded fund (ETF) that is managed by the investment team from WCM, a California-based fund manager.

It's focused on businesses with excellent competitive advantages and that those advantages are improving over time. This usually translates into profit margins (and the bottom line) growing at a good pace. WCM also looks for a corporate culture that fosters that ongoing improvement of the competitive advantages, which can also be called an economic moat.

In the July 2025 update, WCM revealed that it has delivered an average return per year of 16.2% since inception in August 2018. Past performance is not a guarantee of future returns, of course, but it shows how well the investment process has performed.

I'm calling this a compelling ASX share because we can buy it on the ASX, and I appreciate how it can give us exposure to businesses that are not listed on the ASX.

At 31 July 2025, the biggest positions in the portfolio were AppLovin, Amazon.com, 3i Group, Saab and Taiwan Semiconductor.

I like this fund as a way to gain exposure to high-quality global names, but not necessarily relying predominately on the 'Magnificent 7' for those returns.

The post Potential buys: 2 compelling ASX shares I like appeared first on The Motley Fool Australia.

Here's why the broker is feeling positive on these names:

Airtasker Ltd (ASX: ART)

This small jobs platform provider could be an ASX share to buy according to the broker.

It was impressed with its performance in the fourth quarter and its achievement of positive free cash flow. It commented:

Airtasker's (ART) 4Q25 update was highlighted by strong momentum in both its core domestic platform and the newer marketplaces (UK/US). Indeed, the business achieved ~21% revenue growth in the quarter (+13% for the full year), whilst also meeting its guidance of being FCF positive for FY25.

The UK marketplace achieved TTM GMV of A$15m (~+75% on pcp), a key call-out of the update. We update our forecasts to factor in the recent trading update and post a ~6% reduction in our topline estimates for FY26/27 still assume a robust ~15% 3-year revenue CAGR. Our price target is unchanged given a valuation roll-forward and improved longer-term monetisation rate assumptions.

Morgans has a buy rating and 55 cents price target on its shares.

betr Entertainment Ltd (ASX: BBT)

Another small cap that gets the thumbs up from Morgans is sports betting company Betr.

Morgans highlights that the ASX share outperformed its expectations in FY 2025 with a strong result. The highlight was its strong net win margin. It explains:

BETR Entertainment (BBT) delivered a strong finish to the year, comfortably exceeding our expectations on both turnover and gross win. Notably, BBT maintained a net win margin above 10%, despite integrating the traditionally lower-margin TopSport customer base.

With product enhancements underway, we see scope for increased scale and incremental margin expansion heading into the higher-quality racing and sports finals season. We now forecast underlying NPAT of -$4.7m in FY25 and +$2.3m in FY26, reflecting slightly softer top-line growth and higher D&A linked to the amortisation of acquired intangibles (customer list).

Morgans has a buy rating and 38 cents price target on its shares.

Flight Centre Travel Group Ltd (ASX: FLT)

Finally, travel agent giant Flight Centre could be an ASX share to buy according to Morgans.

This is despite the company delivering a disappointing update last week which revealed a downgrade to its guidance.

Morgans thinks it is worth sticking with the company and believes a sharp rebound could happen when trading conditions improve. It said:

FLT has revised its FY25 NPBT guidance by a further 5-12% following a difficult 4Q25 (its key trading period). Given the 1H26 is likely to remain challenging and it will take time for FLT's internal business improvement initiatives to result in material P&L benefits, we have also made large revisions to our FY26 forecasts.

We forecast solid earnings growth to resume from the 2H26. We are buyers of FLT during this period of short-term uncertainty and share price weakness because when operating conditions ultimately improve, both its earnings and share price leverage to the upside will be material.

Morgans has a buy rating and $15.35 price target on its shares.

The post Morgans names 3 ASX shares to buy now appeared first on The Motley Fool Australia.

One of the great things about technology businesses is that they usually have a high gross profit margin, which can lift the other profit margins including the operating profit (EBITDA) margin and the net profit after tax (NPAT) margin, as the business grows.

I'm going to talk about two businesses I've admired for a while and are definitely worth putting on a watchlist.

Airtasker Ltd (ASX: ART)

Airtasker describes itself as Australia's leading online marketplace for local services, connecting people and businesses who need work done with people who want to work. It says it has put more than $650 million into the pockets of workers (after all fee revenue is deducted) and served more than 1.8 million unique paying customers across the world.

The business is growing at a very solid pace. In the third quarter of FY25, Airtasker marketplace revenue increased 15.8% year over year, with Australian revenue rising 10.6% to $10.8 million.

UK revenue jumped 153.2% to £355,000, with brand investment through Channel 4, as well as accelerating traction in Birmingham and Manchester. USA revenue surged 399% to US$86,000 thanks to advertising partnerships with TelevisaUnivision, iHeartMedia, Sinclair and Mercurius during the quarter, as well as new city launches in Austin and Las Vegas.

Pleasingly, the ASX tech share's 'established marketplaces' delivered positive EBITDA of $6 million in the FY25 third quarter. After covering all global head office expenditure, the established marketplaces delivered positive Australian net EBITDA of $1.5 million.

I'm expecting good things from the business. If it can continue growing revenue, the high gross profit margin should help profit flow through the business. In the FY25 first half period, it achieved a gross profit margin of 95.7%, which is really impressive.

I think this ASX tech share could become much larger in the coming years.

TechnologyOne Ltd (ASX: TNE)

TechnologyOne describes itself as Australia's largest enterprise software company and one of Australia's top 100 ASX-listed companies, with locations in six countries. It provides a global software as a service (SaaS) enterprise resource planning (ERP) solution that makes life simple for customers by being easy to use and it's available anywhere and any time.

Impressively, it has more than 1,300 leading businesses, government agencies, local councils and universities are powered by its software.

In this uncertain time, TechnologyOne says that the markets it serves are resilient and it provides mission-critical software. The company says its customers have independently-verified cost savings of at least 40% by moving to SaaS.

The company said it will continue to benefit from improving margins of the significant economics of scale from its global SaaS solution. The business has a long-term target of at least $1 billion of annual recurring revenue (ARR) by FY30.

For some time, it has a goal of doubling in size every five years. This is largely achieved by growing revenue from its existing client base by 15% per year. But investing significantly in research and development every year, the company is able to provide a better offering for customers.

I'm particularly excited by the company's small, but rapidly-expanding UK division. In FY24, the UK business achieved total ARR growth of 31% to $34.7 million. The ASX tech share said it has a strong pipeline in the UK. The education sector is also a large area that TechnologyOne could grow significantly.

The post Growth investors should put these 2 top ASX tech shares on the watchlist appeared first on The Motley Fool Australia.

We want to own businesses that are currently small but are on their way to becoming much bigger in the next few years because they usually create shareholder returns.

The ASX growth share I'm going to write about is Airtasker Ltd (ASX: ART). It has gone up more than 50% in the past year, but its fall of 16% since 23 January 2025 makes it seem like a buy-the-dip opportunity.

I think this company is an attractive opportunity for three main reasons, so let's examine those.

Strong revenue growth

When a business grows revenue at a double-digit pace, I think the company is growing its underlying value at a fast pace as well. The latest update we've heard from the business was the quarterly update for the three months to 31 December 2024.

In that update, the task platform business said its group revenue reached $13.6 million (up 11.4%), with Airtasker marketplace revenue up 15.8% to $11.7 million, Airtasker UK revenue up 95.2%, and Airtasker US revenue up 278.6%.

The ASX growth share has been utilising its media partnerships in the UK and US to access a large amount of potential customers and grow its brand awareness.

The UK and US are both larger markets than Australia, so these two countries could be significant sources of earnings in the next five years.

Airtasker has delivered pleasing revenue growth despite the economic headwind challenges in Australia (and the UK and US) over the past couple of years amid high interest rates. So, a recovery to broad economic growth in Australia (and other countries) could be a useful tailwind in the coming years, if that happens.

Strong profit margin

The ASX growth share has a very high gross profit margin of more than 90%, which means that a lot of the revenue translates into usable gross profit that can be used to invest in growth activities or business capabilities.

Its business model means the business is already delivering positive operating profit (EBITDA) in Australia. In the FY25 second quarter, it said it made $2 million of Australian net EBITDA after taking into account the global head office operating expenditure of $4 million and global head office innovation investment of $0.9 million.

In the next five years, I think the company's high level of gross profitability in Australia can translate into a rising operating profit margin for the overall business. Once they reach a certain scale, operating profit in the UK and US could also rapidly increase.

Geographic expansion possible

When I look at some of the best-performing ASX growth shares over the last five years, international expansion is usually a key element because it expands its growth runway. Examples include Pro Medicus Ltd (ASX: PME) and WiseTech Global Ltd (ASX: WTC).

Airtasker has already demonstrated its enterprise by expanding in the UK and the USA. There are plenty of other markets that the ASX growth share could expand into within the next five years. It has a New Zealand and Singapore website, suggesting where the next focus could be. Canada, Ireland, and South Africa are also countries that could make sense in the next few years.

I'm excited about what could unfold for this business if it continues growing revenue and profitability in the next five years.

The post Opinion: This is one of the best ASX growth shares to own for the next 5 years appeared first on The Motley Fool Australia.

There is a lot to like about the business, in my view.

As the chart above shows, the Airtasker share price has climbed 43% since 2024. I don't expect it to rise by 43% in 2025, but several factors make me believe the company can outperform the market over the long term.

Let's explore why I like this ASX growth share so much.

Strong market position

Airtasker describes itself as Australia's leading online marketplace for local services, connecting people and businesses who need work done with people who want to work.

Aussies can call on Airtasker for a wide variety of tasks, such as administration, furniture assembly, delivery, car work, pet care, various tradesperson tasks, gardening, photography, rubbish removal, and more.

By being number one in the industry, Airtasker can attract the largest number of tasks onto its platform, which can then lead to the most people willing to do the work. This positive self-fulfilling cycle can help Airtasker stay number one into the future.

Excellent revenue potential

Airtasker offers such a large range of tasks that it has an appealing addressable market to help Australians.

The ASX small-cap stock also has a small but growing presence in the United Kingdom and the United States.

In the first quarter of FY25, the company said its trailing 12 months of gross marketplace volume (GMV) had increased 11.7% to US$571,000 (A$860,000), and revenue had increased 64.1% year over year to US$86,000 (A$130,000). Just for the three months to September 2024, US GMV increased 40.2% year over year, and revenue jumped 116.8%.

In the UK, Airtasker's trailing 12 months of GMV were up 38.3% to £5.1 million, and its trailing 12 months of revenue jumped 66.3% to £835,000. For just three months, Airtasker's revenue grew 104.4% year over year.

Overall, Airtasker's marketplace revenue increased 13.6%. If an ASX small-cap stock can regularly grow its revenue in the double-digits, I think it can deliver compelling overall growth. As we know, revenue growth is a key driver of net profit and cash flow.

Compelling profit and cash flow future

One of the business's most appealing features is its high gross profit margin. In FY24, Airtasker achieved a gross profit margin of 94.5%. That means that almost all of its new revenue is turned into gross profit, which can be spent on growth activities such as marketing and software development.

With such a hit profit margin, the company could become pleasingly profitable in the future once it reaches a sufficient size.

The company has already reached positive cash flow, which is a great place to be because it means it's self-sufficient. In the first quarter of FY25, it had a positive free cash flow of $0.1 million and a positive operating cash flow of $0.9 million, up 31.6% year over year.

The ASX small-cap stock is currently investing heavily in growth in the UK and US by working with large television and radio companies. Considering how large those markets are, I think that's a good move.

If it can succeed in the US and UK, I think it can become a much larger business.

The post Why I think this ASX small-cap stock is a bargain at 30 cents appeared first on The Motley Fool Australia.

Look at the chart below. The ASX growth stock has risen close to 2,800% since listing in April 2016.

However, as we can also see on the chart, there has been a significant sell-off since 15 October 2024. It plunged more than 10% after the media reported governance issues relating to founder Richard White.

I think it shows there can be a danger of highly-priced ASX growth shares being sold off when something goes wrong. It could be wise to diversify one's exposure to a few different ASX growth stocks.

I still believe ASX tech shares can be great ASX growth stocks. I really like the two ASX shares below, and I rate them as top buys for growth and diversification.

Bailador Technology Investments Ltd (ASX: BTI)

Bailador is an investment business that invests in smaller, private, fast-growing technology companies. The ASX growth stock is looking for businesses with global addressable markets, international revenue, and good unit economics.

In the last several months, it has made a number of new investments, including digital healthcare platform Updoc, financial advice and investment management software business DASH Technology, and gym and boutique fitness studio software business Hapana.

In its annual general meeting (AGM) presentation, the company noted that its portfolio company revenue growth was 47%, with 91% of revenue being recurring, and the portfolio had a gross profit margin of around 67%.

I think Bailador's portfolio of companies has a strong growth outlook, and I believe they can outperform the S&P/ASX 200 Index (ASX: XJO) over the next five years.

It seems to be trading at a good value – the Bailador share price is trading at a discount of 24% to the post-tax net tangible assets (NTA) per share as at September 2024.

Airtasker Ltd (ASX: ART)

Airtasker describes itself as Australia's leading online marketplace for local services, connecting people and businesses who need work today with people who want to work.

It offers an extremely broad range of services that can be advertised on the platform, including accounting, admin, furniture assembly, delivery, car work, tradesperson work, computers & IT, pet care, hairdressers, and so many more.

The ASX growth stock has a large presence in Australia, and it's growing in the UK and the US. Despite the difficult broader economic conditions, it continues to expand at a good pace.

In FY24, Airtasker marketplaces revenue rose 9.8% to $38.1 million, with UK revenue increasing by 41.1% to $1.3 million and US revenue growing by 73.7% to $0.1 million. These are still small numbers, but if they keep rising rapidly, they could grow into meaningful numbers.

Pleasingly, the business is just reaching profitability. In FY24, its free cash flow was positive and grew by $8.9 million to $1.2 million, while the operating profit (EBITDA) grew by $7.8 million to $0.2 million.

With a gross profit margin of well over 90%, the ASX growth share just needs to keep growing revenue at a pleasing pace for the profit to rise strongly, in my view.  

I think the company's strategy of media partnerships can help accelerate its growth. The UK partnership with Channel 4 helped UK revenue rise 76.3% in the fourth quarter of FY24 to $0.5 million. This is promising for FY25 and beyond.

I think this ASX growth stock still has plenty of potential.

The post Overinvested in WiseTech shares? Here are two alternative ASX growth stocks appeared first on The Motley Fool Australia.

Let's now take a look at two more shares that the broker is feeling bullish about right now. They are as follows:

Camplify Holdings Ltd (ASX: CHL)

Morgans continues to believe that Camplify is severely undervalued by the market.

Camplify operates one of the world's leading peer-to-peer digital marketplace platforms, connecting recreational vehicle (RV) owners to hirers.

It was relatively pleased with its performance in FY 2024 and expects a stronger performance in the new financial year. It said:

Camplify's FY24 result was broadly in line with expectations. Gross transaction volumes (GTV) increased by 13% to A$165m (less than we'd forecast) but a higher-than-expected group take-rate saw revenue broadly in line with our estimate. Whilst the PaulCamper integration impacted bookings/revenue in the period, this is largely completed, with Camplify expecting a return to a more normalised performance in FY25.

Morgans has an add rating and $2.55 price target on its shares.

Airtasker Ltd (ASX: ART)

Another ASX share that has been named as a key pick for Morgans is Airtasker.

It is a small jobs marketplace with operations across Australia, the UK, and the United States. Commenting on its performance in FY 2024, the broker said:

Airtasker's results were in line with its quarterly update released in July. Its marketplace experienced a slight 3.5% decline in GMV yoy, totaling A$190.6 million, but there was a small improvement of 1.1% in the second half of FY24. Revenue grew by 6% to A$46.6 million, driven by better monetisation rates and a 6.6% increase in gross profit to A$44.5 million. Revenue from Airtasker Marketplaces rose 9.8% to A$38.1 million, thanks to a higher monetisation rate and reduced cancellations.

Its analysts were also pleased to see the company making good progress internationally. They add:

Offshore markets are growing, with the UK showing strong results after a brand campaign, with GMV up 35% in Q4 and annual revenue up 41%. The US market, with a cautious marketing strategy, saw a 9.4% increase in GMV and a 74% rise in revenue. Airtasker also announced two more media partnerships (following Ch4 in the UK as well as oOh!Media and ARN Media domestically), these being in the US to assist its ramp of brand awareness and initial platform scaling.

Morgans has an add rating and 52 cents price target on the company's shares.

The post 2 more ASX shares that are 'key picks' for Morgans appeared first on The Motley Fool Australia.

There is no specific definition of what makes a business a growth stock. For me, the revenue needs to be growing at a strong pace, ideally at least approximately 10% per annum.

If I had $5,000 to invest for growth, I'd want to pick stocks where the profit could significantly rise from where it is today.

The below three are a few of my favourites.

Lovisa Holdings Ltd (ASX: LOV)

Lovisa sells affordable jewellery with its global store network. Some of the countries where it has a large number of stores include the US, Australia, the UK, France, Germany and South Africa.

I'm excited by the potential of this ASX growth share because it can significantly increase its revenue simply by adding more stores to its global network.

In FY24, the business added 99 net new stores, taking its global store count to 900. Europe and the USA were the two biggest growth engines. Total FY24 revenue grew 17% to $698.7 million, and net profit jumped 21% to $82.4 million.

Broker UBS estimates that by FY29, Lovisa could generate $1.37 billion in revenue and $189 million in net profit.

Increasing scale could help the business grow its profit margins, which could push up the underlying value of Lovisa and help fund larger dividend payments.

Airtasker Ltd (ASX: ART)

Airtasker provides a platform that enables people who need work to connect with individuals and businesses who want to do that work.

Numerous possible tasks can be advertised on the Airtasker platform, including pest control, removalists, furniture assembly, photography, accounting, delivery, and many more. There is a huge potential market for these services.

One of the most attractive elements of Airtasker's business is the incredibly high gross profit margin – it was above 95% in FY24. Unlike physical product businesses with lower margins, software companies like Airtasker don't need to incur much in costs to generate revenue.

Making strong gross profit means the business can allocate that money towards other types of useful expenditure, including advertising and product development, which can help drive growth.

In FY24, Airtasker marketplace revenue rose by 9.8% to $38.1 million. Excitingly, the company is growing internationally at a rapid rate. For example, in the UK in FY24, gross marketplace volume (GMV) grew by 20% to $8.6 million, and revenue increased by 41.1% to $1.3 million. In the fourth quarter, UK revenue jumped 76.3% to $0.5 million, partly due to the Channel 4 television campaign.

In my opinion, the ASX growth share has reached an important milestone, with positive free cash flow of $1.2 million in FY24 – this was an improvement of $8.9 million year over year. The company can use this cash flow for more growth, a stronger balance sheet, or shareholder returns.

REA Group Ltd (ASX: REA)

This company operates realestate.com.au, the market-leading digital business in Australia. It also owns several other Australian property-related businesses, including realcommercial.com.au, flatmates.com.au, property.com.au, Mortgage Choice, PropTrack, Campaign Agent, Simpology, Arealytics, and Realtair.

It also owns a controlling interest in REA India, which operates the brands of Housing.com and PropTiger. The company also has a significant minority holding in Move Inc, which operates Realtor.com in the US.

REA Group has a very strong market position in Australia, causing the most property sellers to want to list their properties on the platform, which then attracts the most prospective buyers. This is a very helpful, self-fulfilling cycle, in my view.

A strong market position allows the business to regularly implement price increases, with little detrimental effect, helping boost the profitability of the company because of its digital operations nature.

India has a population of well over 1 billion people, so there is huge potential for REA India over the long-term as the country digitalises and uses online tools more often to buy and sell property.

Excitingly, the business demonstrated all of these factors in the FY24 result. Total revenue increased 23% to $1.45 billion and net profit increased 24% to $461 million. Within that, REA India's revenue increased 31% to $103 million.

The company disclosed that the residential buy yield (revenue) in FY25 will be primarily driven by an average 10% price increase in its highest penetrated product called Premiere+. This can help the company's overall financials significantly.

I think this ASX growth share still has a very exciting future.

The post Where I'd invest $5,000 in ASX growth shares right now appeared first on The Motley Fool Australia.

Here's what the broker is saying about these stocks:

IDP Education Ltd (ASX: IEL)

Morgans is tipping this language testing and student placement company as a cheap ASX share to buy.

While the broker expects FY 2025 to be a very difficult year for the company, it believes this is the bottom of the cycle and it will be onwards and upwards from here. It explains:

IEL expects the international student market (new admissions) to be down ~20-25% in FY25. IEL expect to outperform this via meaningful market share gains. We think FY25 is likely to be the trough year for 'student flows', impacted by tighter policies and the associated uncertainty. We expect IEL's earnings to fall ~12%, with some benefits from pricing; market share gains; and solid cost control. We upgrade to an ADD rating.

Last week, Morgans upgraded its shares to an add rating with an $18.20 price target.

Airtasker Ltd (ASX: ART)

Another ASX share that could be cheap according to Morgans is small jobs marketplace Airtasker.

It was pleased to see the company become cashflow positive in FY 2025 and believes this is "the likely new norm" now. Commenting on its results, it said:

With the recent quarterly trading update, ART had largely pre-released key operating metrics, with the FY24 result itself largely per expectations. However, it was a resilient performance by the marketplace overall, with an improved revenue profile despite top of funnel (GMV) headwinds. The business also achieved its planned target of being free cashflow positive (+A$1.2m) for the full year. We maintain our ADD rating.

Morgans has an add rating and 52 cents price target on its shares.

Alliance Aviation Ltd Services (ASX: AQZ)

Finally, Morgans thinks that this airline is "just too cheap" and sees it as an ASX share to buy now.

The broker was pleased with the company's record performance in FY 2024 and expects it to build on this next year. It said:

AQZ reported another record result in FY24, with underlying NPBT up 52% on the pcp and slightly ahead of MorgansF/consensus. We forecast earnings growth momentum (PBT growth of 10%) to continue into FY25 driven by deploying more E190 aircraft and increases in utilisation. We back this founder led management team with a strong track record to continue to execute from here. We maintain our ADD rating.

Morgans has an add rating and $4.10 price target on its shares.

The post Morgans names 3 cheap ASX shares to buy appeared first on The Motley Fool Australia.

Airtasker describes itself as "Australia's leading online marketplace for local services", connecting people and businesses that need work with people who want to work. The company aims to "create truly flexible opportunities to work and earn income".

I'm excited by a business with a compelling future and a large growth runway. Airtasker's platform allows users to advertise tasks for almost anything, including delivery, removalists, furniture assembly, photography, coaching, and so on.

In my opinion, Airtasker is one of the most promising ASX small-cap shares to invest in. Here's why.

Solid revenue growth

The company recently reported its FY24 fourth quarter for the three months ending 30 June 2024. It advised that, despite challenging economic conditions, its FY24 Airtasker platform fee revenue increased 13.9% to $34.1 million. And group revenue lifted 5.6% to $46.6 million. This includes the newly introduced cancellation fee, which saw cancellations reduce by 26.3% year over year.

In the fourth quarter of FY24, Airtasker's UK gross marketplace volume (GMV) rose 34.9% to $3 million, while US GMV grew 9.4% to A$0.8 million.

While its businesses in the United States and the United Kingdom are still small, they are displaying a healthy growth rate and could compound to much larger numbers in the future.

Once the economic picture improves, I think revenue could rise at a faster pace for the ASX growth share.

Excellent profit potential

Profit growth is arguably even more important than revenue growth because investors typically value a company based on how much profit it generates.

The higher a business's profit margins, the more its profit grows when revenue increases. I've already discussed the revenue growth above, but the profit growth also looks appealing.

In the first half of FY24, Airtasker's gross profit margin was above 95%, one of the highest on the ASX. That means nearly all new revenue turns into gross profit, which can then be used for growth expenditures such as marketing or software development.

With ongoing revenue growth, the prospect of profit growth looks likely.

In the third quarter of FY24, the business made positive group earnings before interest, tax, depreciation and amortisation (EBITDA) of $0.6 million (up $1.5 million year over year).

I think Airtasker's EBITDA can jump in FY25 if revenue rises, which looks quite likely given its recent media agreements, which have unlocked an advertising budget of $11 million to grow revenue.

Appealing cash flow model

Airtasker doesn't need to invest a lot of money in property or manufacturing to deliver on its current operations. It's a capital-light model, so growth shouldn't require much capital either.

As the ASX growth share gets bigger, I think its cash flow can soar in Australia. Its platform is already developed, so there isn't too much investing to do from here.

In the FY24 third quarter, the company generated free cash flow of $2.5 million, an improvement of $5.1 million year over year.

That growing cash flow can be used to make acquisitions and/or deliver cash returns to shareholders.

At the end of the fourth quarter, it had $17.8 million of cash and term deposits on its balance sheet. I think it's well-funded for growth.

The post I'm backing this oversold ASX growth share to go on a long bull run! appeared first on The Motley Fool Australia.

Smaller businesses are typically at much earlier growth stages than large ASX blue-chip shares. It's much easier to grow a business from $500 million to $5 billion than to go from $5 billion to $50 billion. There are only so many potential customers out there; eventually, a business reaches a saturation point.

It can be helpful if those businesses are operating in markets that have underlying growth tailwinds.

With the above in mind, I'll outline two ASX stock picks I'm excited about.

Airtasker Ltd (ASX: ART)

Airtasker claims to be Australia's leading online marketplace for local services, connecting people and businesses that need work with people who want work. The platform offers numerous service categories, including delivery, furniture assembly, pest control, handyman tasks, photography, and more.

The recent FY24 update showed strong financial progress for the company.

It reported FY24 Airtasker platform fee revenue increased by 13.9% year over year, while UK fourth-quarter revenue increased 76.3% year over year. Airtasker's total revenue increased 5.6% year over year to $46.6 million.

Pleasingly, the business has made so much progress that it has reached positive cash flow of $1.2 million in FY24, an improvement of $8.8 million. The ASX stock pick achieved "strong operating efficiencies" across the business. The company has a gross profit margin of more than 90%, so most of its new revenue can turn into usable gross profit for growth spending/boosting the profit margins.

Airtasker says it has $11 million of advertising funding from two leading Australian media organisations to help accelerate its growth in Australia.

I think the company could be much larger in the next few years if its profit keeps rising rapidly.

Close The Loop Ltd (ASX: CLG)

This ASX small-cap share has locations across the US, Australia, South Africa and Europe.

One of its main activities is collecting and repurposing products through takeback programs in its resource recovery division. The business also provides sustainable packaging products through its packaging division.

It recovers a wide range of electronic products, print consumables, cosmetics, plastics, paper, and cartons, and it reuses toner and post-consumer soft plastics for asphalt additives.

The business is growing in several ways, and I think it's a good way to participate in the global push for increased sustainability.

Close The Loop is looking to expand geographically, increase the size of its existing operations in its markets, add a new Mexican refurbishment plant and construct a second TonerPlas line.

To me, this ASX stock pick is trading really cheaply. According to the estimates on Commsec, it's valued at 6.5x FY24's estimated earnings and 5.6x FY25's estimated earnings. I think the business would still be very reasonably valued even if the share price and price-earnings (P/E) ratio were 50% higher.

The post 2 ASX stock picks with explosive potential appeared first on The Motley Fool Australia.

One such company is Airtasker Ltd (ASX: ART). It claims to be Australia's leading online marketplace for local services, connecting people and businesses that need work done with people who want to work.

Airtasker shares have been trending higher in the last couple of weeks, as shown in the chart above. I believe there is plenty more to come over the long term.

High gross profit margin

Airtasker has an enormous gross profit margin of more than 90%, which means that almost all of its revenue turns into usable gross profit. With gross profit, the business can spend on growth activities such as advertising and development while also potentially achieving stronger cash flow and better earnings before interest, tax, depreciation and amortisation (EBITDA) margin.

The business is now achieving profit rather than losses, which is an important milestone.

In the third quarter, Airtasker achieved a positive free cash flow of $2.5 million, an improvement of $5.1 million year over year. The group EBITDA was $0.6 million in the third quarter, up $1.5 million compared to the prior corresponding period.

Thanks to growing scale benefits, I think the cash flow margin and EBITDA margin can significantly increase in the coming years.

Strong revenue growth

With good margins, the ASX small-cap share just needs to grow its revenue to deliver good financial progress.

The business revealed its group revenue was $12.2 million in the third quarter of FY24, with Airtasker marketplace revenue growing by 11.5% to $10.1 million.

The company said the revenue growth was driven by a "recovery in consumer demand (posted tasks) from the prior year as well as successful funnel optimisation programs, including a revised cancellation policy designed to improve platform reliability and address task leakage."

Those programs saw cancellations reduce by 23.9% year over year, resulting in the 'monetisation rate' improving by 12.8% year over year to 20.5% for the ASX small-cap share.

Airtasker recently made agreements with media businesses oOh!Media Ltd (ASX: OML) and ARN Media Ltd (ASX: A1N) for $11 million to grow its brand awareness.

Large addressable market

Users can advertise almost any task on Airtasker, including removalists, home cleaning, furniture assembly, deliveries, gardening and landscaping, painting and other handyperson work, business and admin, photography, and many more. There are many categories with a high annual value of work.

Airtasker is growing rapidly in the United Kingdom — a much bigger market than Australia — partly thanks to its partnership with Channel 4. In the FY24 third quarter, UK posted tasks increased by 49.1% year over year.

It has a smaller presence in the United States, but it's growing there too. FY24 US gross marketplace value (GMV) went up 23% from a small base. It's seeing "healthy growth" in marketplace activity while "maintaining a disciplined approach to investment" as it explores "several media partnership opportunities."

I think the international growth could power this ASX small-cap share much higher.

The post Why I'm bullish about this exciting ASX small-cap share appeared first on The Motley Fool Australia.