Buy Hold Sell

12 months ago, David Allingham from Eley Griffiths Group and Andrew Smith from Perennial Value Management went head-to-head with their views on 5 microcap stocks. Since then, the smaller end of the market has been buoyant, with the small ords up ~15%, and both managers exceeding this mark by handsome margins. Research conducted by Citi Group highlights that strong performance in small companies has historically coincided with strong economic conditions like those currently being experienced. So with this in mind, we've called a 'rematch' to hear what may be in store next for the same five stocks as last time: *Afterpay, Ausdrill, Navigator Global, Emerchants and RPM Global.

*Note the code for Afterpay Touch is (ASX:APT), the typo in the video will be updated shortly

Stocks discussed 

Ausdrill (ASL) – David’s pick from last year has doubled since, but the company is now moving into a more capital-intensive stage. Is director selling a red flag?

Navigator Global (NGI) – the stock is up 75% since both panellists gave it a buy last year. Could strong free cash flow,  a recent acquisition, and capable management see the good times keep rolling?

RPM Global Holdings (RUL) – Andrew’s pick from last year has changed its revenue from upfront payments to subscriptions, which is causing some lumpy earnings in the short term but is a good long-term move.

EML Payments (EML) - was up 50% but is now down 25%. Half of its revenue is from an area carrying regulatory risk.  

Afterpay Touch (APT) – has been a winner on the back of market growth domestically, and is the market now underestimating the US market potential?    

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Simon Roberts

great insights in a well presented package