Investment in small-scale players has traditionally been one of the key strategies targeted towards securing wealth generation for HNI individuals, entrepreneurs, and others for long-term. However, small-cap stocks are often overlooked by investors, despite their track record of delivering superior investment returns when compared to large-cap stocks.
A company is categorised under the small-cap sector, if its market capitalisation is anywhere around few hundred million dollars. Companies categorised under the small-cap space are generally leaders in innovation. Moreover, they have the potential to grow rapidly from small bases of revenue.
The management of a small-scale player is generally more receptive towards getting engaged with investors when compared with the teams of larger companies. The main factor behind this approach is the small-cap companies’ intention towards improving the market reach of their business.
Let’s look at following five small-cap stocks with their share price trading below $2.
A2B Australia Limited (ASX: A2B)
A2B Australia Limited, operating since 1976, is a provider of booking and dispatch technologies and payment solutions, enabling the successful operation of personal transport services. The company eases non-cash payments in taxis (electronic terminals).
2019 AGM Results
A2B recently announced the results of 2019 annual general meeting (AGM). All the three resolutions mentioned below secured shareholder approval in the AGM.
Resolution 1 - Re-Election of Ms Louise McCann
Resolution 2 – Adoption of Remuneration Report
Resolution 3 - Grant of Performance Rights to Mr Andrew Skelton, CEO and Managing Director
During the meeting, A2B highlighted the strong progress made during FY2019. The company’s revenue went up by 6.7 per cent and underlying NPAT rose by 9.8 per cent.
In the first quarter of FY20, the company reported a 5.6 per cent year on year increase in revenue with total affiliated fleet of 9,957 cars, up by 4.3 per cent on 30 June 2019 after the acquisition of Gold Coast Cabs.
Draft Paper on Taxi Non-Cash Payment Processing Fee
According to a company announcement dated 12 November 2019, the Victorian Essential Services Commission (ESC) released a further draft paper proposing a range of between 4% (including GST) and 6% for the Taxi Service Fee in Victoria. The Implementation is proposed for May 2020. A2B would review the further draft and continue to consult with the ESC.
On 22 November 2019 (AEST 02:54 PM), the A2B stock was trading at $1.550, representing a dip of 3.727 per cent. The company has ~120.43 million shares outstanding, and a market cap of $193.89 million. The 52-week high and low value of the stock was at $2.280 and $1.360, respectively. The last one month return of the stock is 4.21 per cent.
Cardno Limited (ASX: CDD)
Cardno Limited is a social development company, employing more than 4,000 talented workforce and operating in over 100 countries.
Initial Director’s Interest
On 8 November 2019, CDD released an update related to the initial interest of director, Ms Susan Reisbord, appointed on 4 November 2019. Ms. Reisbord now holds 182,378 performance rights (17A) and 236,402 performance rights (18 A).
The company recently reported regarding the acceptance of the resignation of Mr Ian Ball, its CEO and MD. Meanwhile, CDD appointed Ms Susan Reisbord at the position of Chief Executive Officer and Managing Director. The newly appointed CEO is a thirty-year industry veteran, with experience in the fields of consulting science, engineering and construction. Moreover, she has spent 16 years of her career in MWH Capital Inc.
Cardno Chairman Michael Alscher commented:
On 22 November 2019 (AEST 03:05 PM), the CDD stock was trading at $0.450, down 4.255 per cent from its previous close. The company has ~444.75 million shares outstanding, and a market cap of $209.03 million. The 52-week high and low value of the stock was at $0.752 and $0.445. The year to date return of the stock is negative 25.02 per cent.
K&S Corporation Limited (ASX: KSC)
K&S Corporation Limited is a provider of logistics and transport solutions for the markets of New Zealand and Australia. The company operates in three segments namely, Fuels, New Zealand Transport and Australian Transport.
The company is due to hold its Annual General Meeting on 26 November 2019. The resolutions to be considered in Annual General Meeting are:
- Resolution 1 – Remuneration Report
- Resolution 2 - Election of Director - Mrs SA Emmett
- Resolution 3 - Re-election of Director - Mr JL Winser
K&S Announces Retirement of Independent Non-Ex Director
On 24 September 2019, the company announced the retirement of Mr Ray Smith as a director with effect from the conclusion of the annual general meeting on 26 November 2019. Mr Smith served the company for eleven years as an independent non-executive director.
The company’s financial performance for FY 2019 can be read here.
On 22 November 2019 (AEST 03:09 PM), the KSC stock was trading at $1.540. The company has ~127.28 million shares outstanding, and a market cap of $199.83 million. The 52-week high and low value of the stock was at $1.920 and $1.370, respectively. The YTD return of the stock is 5.72 per cent.
Clean TeQ Holdings Limited (ASX: CLQ)
Clean TeQ Holdings Limited is an Australian stock exchange listed company, engaged in providing metals recovery and industrial water treatment solutions. The company’s vision is to become a leading supplier of clean energy solutions.
CLQ Achieves Acceptance Of World-First CIF® plant in Oman
On 11 November 2019, the company unveiled the successful customer acceptance of commissioning and handover of a ground-breaking Continuous Ionic Filtration (CIF®) plant in Oman.
The company’s CEO, Sam Riggall commented:
The company, through its wholly owned subsidiary Clean TeQ Water, would now be focused on finalising two additional major projects at the Fosterville Gold Mine in Victoria, Australia and at a copper-cobalt mine in the DRC.
To read about the company’s Sunrise Battery Materials Complex Project click here
On 22 November 2019 (AEST 03:15 PM), the CLQ stock was trading at $0.240, down 2.041 per cent. The company has ~746.46 million shares outstanding, and a market cap of $182.88 million. The 52-week high and low value of the stock was at $0.502 and $0.235, respectively. The last one-year return of the stock is negative 40.96 per cent.
QANTM Intellectual Property Limited (ASX: QIP)
QANTM Intellectual Property Limited is the parent company of IP firms, providing services to a range of international and Australian Clients.
In late October 2019, the company announced that the AGM of shareholders would be held on 28 November 2019. The resolutions to be considered in Annual General Meeting are:
- Resolution 1 - Remuneration Report
- Resolution 2 – Re-election of Director, Mr Cameron Judson
- Resolution 3 – Re-election of Director – Ms Sonia Petering
- Resolution 4 – Employee Incentive Plan
- Resolution 5 - Approval of additional capacity to issue Equity Securities under ASX Listing Rule 7.1A
Financial Performance for FY 2019
On 25 October 2019, the company released the Annual Report for the FY 2019 period ended 30 June 2019. Below are the few highlights:
- The company’s total revenue increased by 10.3 per cent to $112.2 million compared to the previous corresponding period (PCP).
- EBITDA margin of the company increased by 5.3 per cent to 27.7 per cent for service revenue.
- QIP’s net debt rose by 33.7 per cent to $11.1 million.
- The company unveiled the full year 100 per cent franked dividend of 8.3 cents for the year, compared with 7.1 cents in the year ago period.
On 22 November 2019 (AEST 03:22 PM), the QIP stock was trading at $1.335. The company has ~133.05 million shares outstanding, and a market cap of $178.29 million. The 52-week high and low value of the stock was at $1.770 and $1.200, respectively. The last one month return of the stock is negative 1.47 per cent.
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