Wilson Asset Management believes these 2 leading small cap ASX shares are a buy

Silk Logistics and Swoop are two ASX shares that could be good ideas.
The post Wilson Asset Management believes these 2 leading small cap ASX shares are a buy appeared first on The Motley Fool Australia. –

The fund manager Wilson Asset Management (WAM) has recently identified two top small cap ASX shares that it owns in its portfolio that could be ideas.

WAM operates several listed investment companies (LICs). Some focus on larger companies like WAM Leaders Ltd (ASX: WLE) and WAM Capital Limited (ASX: WAM).

There’s also one called WAM Microcap Limited (ASX: WMI) which targets small cap ASX shares with a market capitalisation under $300 million at the time of acquisition.

WAM says WAM Microcap targets the most exciting undervalued growth opportunities in the Australian microcap market.

The WAM Microcap portfolio has delivered gross returns (that’s before fees, expenses and taxes) of 24.2% per annum since inception in June 2017, which is superior to the S&P/ASX Small Ordinaries Accumulation Index average return of 12%.

These are the two small cap ASX shares that WAM outlined in its most recent monthly update:

Silk Logistics Holdings Ltd (ASX: SLH)

WAM explains that Silk Logistics is one of the largest third-party logistics suppliers in Australia.

Over the last several years, the business have been active with making acquisitions. The business has been successful at this, according to the fund manager. Silk Logistics has benefited from industry consolidation.

The business recently listed, in July 2021. The Silk Logistics share price increased by 25% on the first day of trading.

WAM explained that Silk Logistics is a beneficiary of the tailwinds in the logistics sector triggered partly by the COVID-19 pandemic, which has led to a surge in demand for delivery services.

The fund manager likes the long-term outlook for the ASX share, targeting industries less impacted by economic downturns such as food and packaged agriculture products.

It was also pointed out that Silk Logistics is investing in tracking technology that “gives visibility” to the inefficiencies in a supply chain, adding to its customer service offering and improving its competitive position.

Swoop Holdings Ltd (ASX: SWP)

Swoop is the other ASX share that WAM Microcap noted.

This business is an Australian internet provider that is headquartered in Victoria and has expanded into South Australia. It listed onto the ASX a few months ago – there was apparently a lot of demand from both institutional investors and retail investors for the capital raising which was $20 million in size.

Talking about the bull case for the business, the fund manager said that it’s a beneficiary of the increased demand for home internet in a world where many more people are working from home because of COVID-19.

WAM believes Swoop’s growth potential has increased after the acquisition of the South Australian based wireless broadband provider Wan Solutions, which trades as Beam Internet. The deal means Swoop can use Beam’s recently upgraded network to grow well in the South Australian market.

The post Wilson Asset Management believes these 2 leading small cap ASX shares are a buy appeared first on The Motley Fool Australia.

Wondering where you should 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 could be the five best ASX stocks for investors to buy right now. These stocks are trading at near dirt-cheap prices and Scott thinks they could be great buys right now.

*Returns as of May 24th 2021

More reading

Here’s why the Swoop (ASX:SWP) share price is soaring 7% today
Wilson Asset Management thinks these 2 top small cap ASX shares are a buy

Motley Fool contributor Tristan Harrison has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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!