3 ASX small-cap stocks to buy for 2025: brokers
The S&P/ASX Small Ordinaries Index (ASX: XSO) is 0.59% higher today and up 5.9% in the year to date.
ASX small-cap stocks are young, developing companies with a market capitalisation of between a few hundred million and $2 billion.
Let's take a look at three ASX small-cap stocks that have captured the attention of brokers this week.
3 ASX small-cap stocks primed for growth: brokers
EML Payments Ltd (ASX: EML)
Tamim Asset Management maintains its bullish view on this ASX payment solutions provider.
The ASX small-cap financial stock is steady at 94 cents today and up 18% in the year to date.
In a new note this month, Tamim described EML Payments as being at a 'pivotal juncture'.
It noted the company's "strong revenue base" and opportunity to derive more value from its 1,100 customer relationships through cross-selling and expanded partnerships.
Tamim reckons EML shares are also an attractive takeover target, commenting:
…with a $95 million EBITDA target in three years versus a current EV [enterprise value] of approximately $350 million, EML presents itself as a compelling takeover candidate.
A bid in the range of $500-600 million ($1.50 per share) seems highly plausible within the next six months, offering significant upside for shareholders.
Bluebet Holdings (ASX: BBT)
Morgans has maintained its add rating on online sports betting company, Bluebet. It has also raised its 12-month spare price target marginally from 35 cents to 36 cents.
The Bluebet share price is 30 cents per share on Tuesday, up 0.67% today and up 51% in the year to date.
Bluebet has a market cap of $170 million, which means it is technically an ASX micro-cap share.
In a new note, Morgans said Bluebet shares remain "attractive at current levels".
The broker explained:
November's net win margin was 12.8%, supported by robust trading and efficient promotions using its proprietary tech platform.
2QTD's margin stands at 11.5% and reassures us that the company is on track to meet earnings targets and build momentum for next year.
BBT confirmed it was EBITDA-positive in November and remains on course for an EBITDA-positive FY25 result.
… we expect 1H25 underlying EBITDA of $0.5m and a NPAT loss of $2.2m.
Our full-year earnings estimates for FY25-26F increase by 3.5% and 1% respectively.
Acusensus Ltd (ASX: ACE)
Acusensus develops AI solutions for road safety. It is also a micro-cap with a valuation of $158 million.
Canaccord Genuity has maintained its buy rating and $1.30 price target on this ASX tech share.
The Acusensus share price is $1.14, down 0.87% today but up 43% in the year to date.
In a new note, Canaccord analysts Owen Humphries and Annabelle Holden said momentum was building across all markets.
The analysts wrote:
ACE is in the early stages of its global expansion, leveraging its patented technology to capture the ~$1.8b global market opportunity.
The company is undertaking a period of investment to seize the opportunity with the global business absorbing cash, while the Australian business remains strongly earnings positive.
We estimate the Australian business generates revenues of $50m, with growth of 15%-20% with look-through EBITDA margins ~20%.
In our view, this implies the domestic business trades on 10x EV/EBITDA, with investors getting the large global expansion for free which we estimate generates >$4m revenue in FY25E at >100% growth rates and could be valued higher than the domestic business over time given the size of the opportunity.
The post 3 ASX small-cap stocks to buy for 2025: brokers appeared first on The Motley Fool Australia.
Motley Fool contributor Bronwyn Allen has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has positions in and has recommended EML Payments. 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 Scott Phillips.&amp;amp;amp;amp;amp;amp;amp;amp;amp;lt;/em&gt;</em>
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