Seneca's sliding doors (10x ASX stock predictions)

10x incisive ASX share market predictions in the small and mid-cap space - what to watch in FY27.

July 02, 2026 07:30

Seneca Financial Solutions

Inspired by AFL journalist Damian Barrett's weekly sliding doors column, we thought we'd use the format to have a bit of fun and outline some punchy ideas in the ASX small and mid-caps landscape.

Originally stemming from the 1998 film Sliding Doors, which hinges on a single split-second decision that creates two parallel futures, this column explores the "what if?" scenarios that shape investing and markets.

IF...

Healthscope does a deal that results in their hospitals being re-tenanted and leased to an alternative operator...

THEN...

Surely the HealthCo REIT (ASX: HCW) dividend is reinstated. At which point, why is HCW trading at a 50% discount to NTA?

We think the stock re-rates +50% and has the potential to pay a special dividend. Risk is mitigated by Healthscope's continued payment of rent on time and in full.

IF...

HCW re-rates as we expect...

THEN...

Attention will turn to the biggest beneficiary of this shift in asset quality - the fund manager, HMC Capital (ASX: HMC).

HCW is a REIT, externally managed by HMC Capital. Following the Healthscope receivership and the decision to suspend HCW distributions, HMC Capital announced a package of measures to align with unitholders, including waiving 50% of its base management fees.

HMC sentiment has been in the trash, following the poor performance of its underlying vehicles, namely HCW and DigiCo (ASX: DGT).

HMC just won a >$1b private credit mandate, proving they can still grow fee-earning AUM from institutional asset allocators.✅

IF...

The RBA is done hiking rates (the yield curve is starting to imply that it is...)...

RBA Overnight Cash Rate (LHS, inverted) vs Australian 2-10's Yield Curve (RHS)

Source: Factset, Seneca Financial Solutions

THEN...

Retailers are probably a buy.

We've avoided them for years, but rate cuts could see retailers re-rate from very depressed levels.

Our preferred pick here is Lovisa (ASX: LOV), the fast fashion jewellery retailer whose store rollout has seen incremental returns on capital go from strength to strength.

You've never lost money buying LOV on a 20x P/E; major shareholder Brett Blundy has been buying, and its loss-making Jewels venture is obscuring underlying profitability, which could be a catalyst once resolved.

IF...

Tax loss selling reverses in July...

THEN...

Look out.

Watching the screens every day, we have noticed some indiscriminate selling on the ASX in the last couple of months, particularly at the smaller end of the market.

It is far easier to justify selling your losers in the spirit of 'tax planning' rather than taking a loss, all while ignoring the fundamentals of the underlying business you're invested in. Fundamentals tend to suddenly matter a lot more in July each year.

Our top small-cap tax-loss trades include:

Catapult (ASX: CAT)'s underlying business continues to perform well, despite shares trading lower from $7.00 to under $3.00. We see a compelling opportunity arising from erroneous assumptions about AI disruption, index exclusion, and tax-loss selling.
Siteminder (ASX: SDR): More faulty AI assumptions and indiscriminate selling saw this high-quality compounder fall from $7.50 to $3.00. It's bounced a bit lately, but still looks too cheap to us.
Qoria (ASX: QOR): could almost be its own sliding doors special, but if this merger goes through, the balance sheet issues are resolved, and the company can deliver the guided free cash flow at it's inaugral full-year result (which the market is very sceptical of...), then is less than 2x ARR the right multiple for a rule-of-40 cyber security business on the ASX?

At Seneca, we like to buy off these sorts of price-indiscriminate, forced sellers; it is a consistent source of outperformance in our strategy.

IF...

If the Bank of Montreal (BMO)'s entry into Australian capital markets goes anything like Canaccord Genuity's (Patersons)...

THEN...

Its acquisition of Euroz Hartleys (ASX: EZL) should perform well.

We've been screaming about EZL for the last couple of years on Livewire (here, here and here).

On 30 June, BMO confirmed a $145 million cash bid for EZL's capital markets business, leaving $94.3 million in cash and investments that would likely be distributed to shareholders, essentially leaving a free option on the private wealth business at a $219 million market cap.

Private wealth is important to the success of the capital markets business, so it depends on the proposed joint venture terms. But the business has $5.1 billion in funds under advice, and generates valuable recurring revenue, so it is certainly not worth nothing.

IF...

Bennelong is done selling Credit Corp (ASX: CCP)...

THEN...

Why is CCP on 7.5x P/E?

Brokers have been quick to point out that Bennelong, which has suffered from Corporate Travel Management-related redemptions, has been a significant forced seller of other stocks they hold, particularly Credit Corp.

Short sellers sniff out a forced seller better than anyone. And they have just bought back the last of Bennelong's overhang to close out their shorts, which matches up to 'ceasing to be a substantial holder' notices, announced to the ASX.

Credit Corp Short Interest, source: Shortman

Credit Corp reaffirmed NPAT guidance for $100-$110 million in May (equating to +12% growth), confirmed they're no longer pursuing the Humm (ASX: HUM) acquisition, and peers are doing well overseas.

We expect a catch-up trade when the market catches on.

IF...

Copper developer New World Resources (ASX: NWC) went from 2 cents to 6.7 cents in a hotly contested bidding war between Kinterra Capital and Central Asia Metals (LON: CAML)...

THEN...

Kinterra's 20% stake it recently took in Maronan Metals (ASX: MMA) suggests they probably want to own 100% of that at some point.

A 6-month standstill gives Maronan some time to tease out any other strategic interest and get some firm economics out in a prefeasibility study. But after that, we don’t see how MMA still trades at a $135 million market cap now that it is cashed up, with a project NPV approaching $1 billion, in a region that has historically been undercapitalised.

IF...

Electrical contractors are trading on 20-30x earnings...

THEN...

We will look back on this in 3 years and think, in hindsight, what an easy sell they were.

I was on a broker call with an electrical contractor the other day, where they talked about how hotly contested the M&A market is for buying private contractor businesses, and that the multiples paid for these businesses are increasing. This is a stark contrast to a few short years ago and a reminder of where we are in the cycle.

With echoes of "this time is different" ringing in my head, this time does not feel different for a low-moat, high-capital-intensity business.

IF...

The $8 billion market-capped Greatland Resources (ASX: GGP) is highlighting the higher-grade component in its West Dome open-pit ore reserve at just 0.53g/t Au…

Source: Greatland Resources (GGP) March 2026 Group Ore Reserve Statement, released 29 June 2026.

THEN...

I'd hate to see the low-grade component…

We are still long Antipa Minerals (ASX: AZY), as discussed most recently here, which has a 2.9 Moz gold deposit nearby with a grade more than double the Telfer open-pit reserve.

IF...

You've been following our ideas this financial year...

THEN...

Why don't you invest with us?

The Seneca Australian Small Companies Fund has done 20.83% p.a. returns since inception, outperforming the S&P/ASX Small Ordinaries Index by +7.96%. It's a 0.00% management fee and a 20% performance fee above the hurdle rate.

The Seneca Australian Shares Fund is a relatively new product for us; however, its underlying strategy has been run as a separately managed account (SMA) since 2020. The SMA version has delivered 10.47% p.a. returns and has been ahead of its benchmark for the vast majority of the time since inception. 0.75% p.a. management fee, no performance fee on this one.

Both are open to sophisticated, professional and wholesale investors.

Managing your own portfolio?

We can help you with two detailed ASX-listed investment ideas each month from our subscription service, Good Research.

We've tipped our members off to stocks like Catapult (ASX: CAT) at $1.96, Antipa Minerals (ASX: AZY) at $0.26 and Pointbet (PBH) at $0.49 before it was taken over at $1.32.

Just want some of our thoughts in your inbox, once a week, for free?

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All the best for FY27.

BR (and LL)

Managed Fund

Seneca Australian Small Companies Fund

Australian Shares

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The information contained in this article is general in nature and does not take into account your personal situation. You should consider whether the information is appropriate to your needs, and where appropriate, seek professional advice from a financial adviser. Ben Richards, Seneca Financial Solutions, its Directors and its associated entities may have or had interests in the companies mentioned. They also may have or have had a relationship with or may provide or have provided capital markets and/or other financial services to those companies mentioned. Although every effort has been made to verify the accuracy of the information contained in this article, all liability (except for any liability which by law cannot be excluded), for any error, inaccuracy in, or omission from the information contained in this email or any loss or damage suffered by any person directly or indirectly through relying on this information.