Here's why the broker thinks they could be buys for investors with a high tolerance for risk:

Mach7 Technologies Ltd (ASX: M7T)

The first small-cap ASX share that could be a buy according to Morgans is Mach7. It is a provider of medical imaging software, delivering advanced data management and diagnostic viewing solutions to healthcare organisations worldwide.

Morgans was pleased with its quarterly update and the achievement of operating cashflow breakeven. It said:

M7T posted its 2Q26 cashflow report, reporting a breakeven operating cashflow following marked improvements in cash collection and a streamlined expense position through normalised billing and lower staff costs. ARR remained stable at A$23.0m, while CARR declined to A$26.1m following the known VHA and Trinity headwinds, partially offset by the first Flamingo Architecture customer win and growth from existing clients.

Execution momentum strengthened, including positive RSNA-generated leads, improved eUnity KLAS scores, and cost-outs across the organisation. Positive update and M7T appears seeded for good growth opportunities into FY27. No changes to forecasts or target price and our Buy recommendation remains.

Morgans has a buy rating and 76 cents price target on its shares.

Micro-X Ltd (ASX: MX1)

Another small-cap ASX share that has been given the thumbs up is Micro-X. It is a technology company developing and commercialising a range of innovative products for global health and security markets. These are based on proprietary cold cathode, carbon nanotube (CNT) emitter technology.

Morgans was pleased with Micro-X's quarterly update and believes there is more to come, with 2026 looking like a transformational year. It said:

MX1 posted a solid 2Q26 cash flow report. Highlights included a capital raise which has taken the funding question off the table and receipt of the largest Rover Plus order to date. Key catalysts to focus on include: receipt of additional Rover sales orders; commencement of Head CT human imaging trial; and monetisation of non-core security assets. We have made no changes to our forecasts or valuation. We maintain our SPECULATIVE BUY recommendation and believe 2026 will be a transformational year for MX1.

Morgans has a speculative buy rating and 16 cents price target on its shares.

The post Morgans names 2 small cap ASX shares to buy appeared first on The Motley Fool Australia.

But which ones could be buys?

Fortunately, the team at Morgans has done the hard work for you by picking out two small caps that it rates as speculative buys with major upside potential. They are as follows:

Micro-X Ltd (ASX: MX1)

The first small cap ASX share that Morgans is positive on is Micro-X. It is a tech company developing and commercialising products for global health and security markets based on proprietary cold cathode, carbon nanotube (CNT) emitter technology.

The broker has been pleased with the progress the company has been making. This includes winning a major contract for its Rover Plus offering this month. It said:

MX1 continues to make solid progress across all its verticals. Today MX1 announced its largest contract for its Rover Plus worth A$3.3m. Other recent announcements note positive progress on the Head CT imaging project with the ASA, a A$4.4m grant to trial the head CT scanner in standard ambulances for stroke diagnosis and a contract extension with the DHS to enhance the self-screening checkpoint detection algorithm.

We have made no changes to forecasts or valuation of A$0.17. The cadence of news flow increases our confidence that MX1 has reached an important inflection point and deserves greater investor attention. We maintain our SPECULATIVE BUY recommendation.

Morgans has a speculative buy rating on its shares with a price target of 17 cents. Based on its current share price of 11 cents, this implies potential upside of 55% over the next 12 months.

Neurizon Therapeutics Ltd (ASX: NUZ)

Another small cap ASX share that has caught the eye of Morgans is Neurizon Therapeutics.

It was pleased to see the US Food & Drug Administration (FDA) lift the clinical hold on its NUZ-001 product this week. It notes that this removes a major regulatory overhang and ought to be considered a de-risking event. It said:

The FDA has finally lifted the clinical hold on NUZ-001 after 9 months, clearing the way for NUZ to join the HEALEY ALS Platform Trial and removing a major regulatory overhang. First patient enrolment in the HEALEY trial is targeted by the end of the year, with initial data possible by late 2026 depending on recruitment rates.

This is a major catalyst and a clear regulatory de-risking event for NUZ. With a validated IND and a clear path into HEALEY, we expect renewed investor interest and momentum in the stock as the company advances towards trial and data. Our target price moderates to A$0.39 and we maintain our Speculative Buy rating.

Morgans has a speculative buy rating and 39 cents price target on its shares. Based on its current share price of 14 cents, this suggests that upside of well over 100% is possible between now and this time next year.

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Micro-X shares surged 37% from 13.5 cents to 18.5 cents before retreating. The company's shares finished the day up 26%.

Let's take a look at what this ASX medical tech share reported.

New strategic partnership

Micro-X has formed a strategic partnership with Varex Imaging Corporation (NASDAQ: VREX). Varex is said to be the biggest independent manufacturer of x-ray technology components in the world.

Varex will pay Micro-X US$5 million (about A$7.5 million) for a global exclusive licence to use Micro-X's NEX technology. Under the deal, Varex will be able to design, make and sell multi-beam x-ray tubes using this technology.

Further, Varex will take a 9.9% stake in Micro-X via a share placement of 50,709,000 shares at 14.7 cents per share. This investment is valued at nearly $7.5 million. In total, this would take Varex's investment in Micro-X to about $15 million.

Commenting on the news, Micro-X managing director Peter Rowland said:

This long-term investment will continue to promote Micro-X on the world stage, as a leader in innovative products and technology that is designed to make lives better.

This collaboration contributes hugely to our future growth and allows us to continue to focus on future medical and security imaging applications for our proprietary NEX Technology

Micro-X is holding an investor call at 9am on Tuesday to discuss this news.

Micro-X share price snapshot

The Micro-X share price has slid 42% in the past year, while it has fallen 33% year to date.

For perspective, the S&P/ASX 200 Health Care Index (ASX: XHJ) has fallen nearly 14% in a year.

Micro-X has a market capitalisation of about $78 million based on the current share price.

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In light of this, I thought I would scour through a range of recent notes to see which small cap ASX shares are in favour with brokers at present.

Three that have been given buy ratings are listed below. Here's why brokers like them:

Genmin Ltd (ASX: GEN)

According to a note out of Bell Potter, its analysts have initiated coverage on this iron ore exploration company's shares with a speculative buy rating and 44 cents price target. The broker has been looking over Genmin's pipeline of projects in Gabon, Africa. It believes there is the potential to support an iron ore production hub initially of 5-10Mtpa. Overall, the broker likes the company due to it offering exposure to future high margin iron ore production and the strategic theme of the development of ex-Australian iron ore supply. The Genmin share price is fetching 19.5 cents on Thursday.

Micro-X Ltd (ASX: MX1)

A note out of Morgans reveals that its analysts have retained their speculative add rating and 58 cents price target on this x-ray technology company's shares. Morgans notes that the company has signed a number of key contracts this month. This includes with the US Department of Homeland Security and Australian Stroke Alliance. The latter is worth $8 million to the company and is for the development of lightweight stroke diagnostic imaging technology. The Micro-X share price is trading at 33 cents today.

Readytech Holdings Ltd (ASX: RDY)

Analysts at Macquarie have retained their outperform rating and lifted their price target on this mission critical software company's shares to $3.98. This follows news that the company has signed an agreement to acquire Avaxa for $2.2 million. Avaxa is a specialist enterprise student management software company. Macquarie expects it to support ReadyTech's JobReady Plus platform. The Readytech share price is trading at $3.49 today.

The post Top brokers name 3 ASX small cap shares to buy appeared first on The Motley Fool Australia.

In this climate, a good way to pick ASX shares to buy is to target those with positive near-term catalysts, according to Morgans.

The broker's advise comes as the S&P/ASX 200 Index (Index:^AXJO) bounces between both sides of breakeven today. The index has traded in a less than 200-point band in the past seven weeks.

Target ASX shares with near-term catalysts

Investors are torn between the strong earnings outlook for ASX shares and fears that share prices are primed for a big pullback.

As I reported last week, Morgans believes you should ignore the jitters and use any market weakness as a buying opportunity.

The broker highlighted some ASX 200 shares to buy as it expects them to release positive news in the near-term.

It expects that these good updates will propel their share prices even in the face of a broader market sell-off.

ASX small cap shares that could outperform in the near-term

But there are a number of little known ASX shares that many have overlooked that are also in this basket.

The first is the Kina Securities Ltd (ASX: KSL) share price. The small cap Papua New Guinea broker has around a 60% upside to Morgans' share price target and you may not have to wait long for the Kina Securities share price to surge towards fair value.

"We expect closure of the WBC Asia Pacific acquisition in September to be a material catalyst, forcing the market to reconsider strong earnings growth into FY22," said Morgans.

Dividend restart to light this ASX small cap

Another lesser followed ASX share is the Dalrymple Bay Infrastructure Ltd (ASX: DBI) share price.

Morgans reckons there is a close to 20% upside for the coal export port operator, although ESG conscious investors may shun shares with the "C" word.

But the broker believes that any news of the company restarting its quarterly dividends could light a fire under the Dalrymple Bay share price. This could come as June.

Looking for the X-factor

Those looking for more bang for their buck may want to consider the Micro-X Ltd (ASX: MX1) share price.

The X-ray technology developer that's used for security and medical screening could see its share price surge in the coming weeks or months.

Morgans expects Micro-X to announce that it has secured European regulatory approval for its technology in the current quarter. There is a close to 80% upside for the Micro-X share price to the broker's price target.

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