How to diversify portfolio with NZX small-cap stocks?

Highlights

  • Small-cap stocks could have huge growth potential, to be considered for a diversified portfolio.
  • Promisia Healthcare hired a new CEO, Chris Brown, last month.
  • Vital announced an impressive FY21 performance and would pay the dividend on 15 October.

Small-cap stocks refer to those companies that have a market cap lying below two billion dollars. Though they are smaller, these companies present huge growth opportunities.

Hence, investors could consider building a diversified portfolio, with the right mix of large-cap, mid-cap as well as smaller companies.

Amid this background, let us glance at the five NZX small-cap stocks worth looking at.

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Promisia Healthcare Limited (NZX:PHL)

Providing aged care facilities in New Zealand, Promisia Healthcare Limited boasts a market cap of over NZ$21 million. It witnessed the appointment of new Chief Executive Officer, Chris Brown, in August 2021.

The Company looks forward to the new leadership as it moves towards the next phase of growth.

At the closing bell, on 3 September, Promisia Healthcare traded flat at NZ$0.001.

Related Read: Which are the well-known retirement village shares in New Zealand?

Cooks Global Foods Limited (NZX:CGF)

Functioning as a food and beverage company, Cooks Global Foods Limited has a market cap of more than NZ$26 million. The Company Thursday announced to conduct a virtual Annual Meeting of Shareholders on 28 September.

Also, it has mentioned the last date for sending the director’s nominations is 13 September.

On 3 September, Cooks Global Foods gained by 2.38% at NZ$0.043, at the market close.

Related Read: How are these 5 NZX retail stocks faring in 2021?

Vital Limited (NZX:VTL)

Offering communication networks across the country, Vital Limited has a market cap of around NZ$28 million.

In its recently announced FY21 results, the Company’s PAT grew by 14.5% from previous year and stood at NZ$0.841 million. Also, its revenue amounting to NZ$35.24 million saw a 5.6% increase on pcp.

The Company is now focused on leveraging its nationwide presence and offering new solutions after the completion of its major infrastructural projects.

It would pay a dividend of 2.0 cps to its shareholders on 15 October.

At the market close, Vital remained unchanged at NZ$0.670, on 3 September.

Must Read: Which are the four hot NZX-listed telecom stocks?

Livestock Improvement Corporation Limited (NZX:LIC)

Livestock Improvement Corporation Limited boasts a market cap of more than NZ$169 million.

The Company announced impressive FY21 results, wherein its NPAT soared by 31% to NZ$22.9 million and its revenue stood at NZ$249.0 million for the year, majorly on account of good growth across its business operations, particularly the genetics segment.

It had paid a dividend of 12.51 cps last month.

Also, LIC expects underlying earnings between NZ$19 million to NZ$25 million for FY22.

On 3 September, Livestock Improvement Corporation traded flat at NZ$1.300, at the end of the trading session.

Related Read: Look at 5 popular stories making the rounds at NZX

Savor Limited (NZX:SVR)

One of NZ's famous hospitality businesses, Savor Limited, boasts a market cap of more than NZ$32 million. The Company will be organising its Annual Meeting on 23 September, details of which would be intimated later.

On 3 September, Savor rose by 1.85% at NZ$0.530, at the closing bell.

Also Read: Do penny stocks ever go big? A glance at 10 related NZX stocks

Bottom Line

To achieve a balanced portfolio, one should have the right mix of both large-cap as well as small-cap stocks to gain maximum benefit. As a result of a diversified portfolio, investors face lower risks incase of market volatility.

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