2 rapidly growing small cap ASX shares to buy

Bigtincan Holdings Ltd (ASX:BTH) and this small cap ASX share are growing rapidly. Here’s why they are rated as buys…
The post 2 rapidly growing small cap ASX shares to buy appeared first on The Motley Fool Australia. –

If you’re interested in adding some exposure to the small side of the market to your portfolio then you might want to take a look at the shares listed below.

Here’s why these ASX small caps have been tipped as buys:

Bigtincan Holdings Ltd (ASX: BTH)

The first small cap ASX share to look at is Bigtincan. It is an artificial intelligence-powered sales enablement automation platform provider. The company’s platform is being used by a growing number of blue chips, this includes 7 of the top 10 companies on the Fortune 500.

Last month Bigtincan released its second quarter update and revealed strong recurring revenue growth once again. According to the release, the company’s annualised recurring revenue (ARR) reached $48.4 million at the end of December. This represents an increase of 50% over the prior corresponding period.

Pleasingly, although the company has made some acquisitions, the majority of its growth was organic. Management advised that organic ARR came in at $40 million, which was up 42.9% on the prior corresponding period. ARR from acquisitions totalled $8.4 million.

Analysts at Morgan Stanley were impressed with its update. They initiated coverage on the company’s shares with an overweight rating and $1.40 price target. The broker believes the company is well-positioned for growth thanks to its leadership position in a growing market.

Universal Store Holdings Limited (ASX: UNI)

Another small cap ASX share to look at is Universal Store. It is a leading fashion retailer with a strategy of delivering a frequently changing and carefully curated selection of on-trend products to a target 16-35 year old fashion focused customer.

As with Bigtincan, it recently released a trading update which revealed very strong growth so far in FY 2021.

According to the release, Universal Store expects its underlying earnings before interest and tax (EBIT) to be in a range of $30 million to $31 million for the first half. This represents growth of between 61% and 67% on the prior corresponding period. This was driven by strong like for like sales growth and gross margin improvements.

This update went down well with Morgans. In response to the update, the broker put an add rating and $6.93 price target on its shares. It believes Universal Store is well-placed to grow its earnings at a 30% compound annual growth rate through to FY 2023.

Where to invest $1,000 right now

When investing expert Scott Phillips has a stock tip, it can pay to listen. After all, the flagship Motley Fool Share Advisor newsletter he has run for more than eight years has provided thousands of paying members with stock picks that have doubled, tripled or even more.*

Scott just revealed what he believes are the five best ASX stocks for investors to buy right now. These stocks are trading at dirt-cheap prices and Scott thinks they are great buys right now.

See The 5 Stocks

*Returns as of June 30th

More reading

James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. recommends BIGTINCAN FPO. The Motley Fool Australia owns shares of and has recommended BIGTINCAN FPO. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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

Trade The World Anywhere & Anytime!

Mobile app platform with over 50,000 global listed securities across 12 markets (over 70% global market capitalisation), right from your Android or iOS device.

Integrated with exclusive trading idea and investment analysis tools to help you find actionable insight on virtually every financial instrument across our 12 global markets, to help you optimise your trading strategies.

Refer Your Friends

Tell your friends about Monex and gift them FREE access to our trading tools.

We respect your privacy and will only send this one email notification to your friends. 

Share With Your Friends

Share on facebook
Share on twitter
Share on linkedin

Monex Trading Tools Access and Usage Terms

The Monex Trading Tools (referred to as ‘tools’ hereafter) are available to you inside your client portal;

To activate access to the tools, you must have a verified and approved trading account and have made a deposit of at least AUD $1000.

An active and funded account with a positive trading balance is required to continue to have access to the tools;

Although the tools are available to you indefinitely, Monex Securities may at it’s discretion disable access to the tools in the future;

Monex securities reserves the right to change these terms and conditions from time to time, as it sees fit, without notice.

Important Notice
iOS & Android App - 12 International Markets & Over 70% Global Market Cap. $0 Brokerage On US Trades. Click Here!