As well as high quality blue-chip shares with solid growth prospects such as Ramsay Health Care Limited (ASX: RHC) and SEEK Limited (ASX: SEK), I believe the Australian share market is home to a number of small-cap shares with equally promising futures.
Three such small-caps that I think could be great investments today are listed below. Here's why I think they could be in the buy zone:
The Collins Foods Ltd (ASX: CKF) share price has fallen 20% this year, meaning its shares are now changing hands at just 14x trailing earnings. The decline in its share price is largely due to a sell-off following a successful $54.5 million placement of shares at $5.25 per share. These funds will be used to acquire 16 KFC restaurants in the Netherlands, further expanding the company's international footprint after last year's move into the German market. As both markets provide significant growth opportunities, I think now could be a great time to invest.
So far this year the Medical Developments International Ltd (ASX: MVP) share price has rocketed by 15%. But considering the early success its Penthrox pain management product is having in many international markets, I don't think it is too late to invest in this healthcare company. As well as expanding its flagship product's global presence, management is also actively looking into expanding its use into minor surgical procedures. This market is estimated by management to be worth up to $2 billion a year.
The Tassal Group Limited (ASX: TGR) share price has tumbled around 5% in March. Like Collins Food, the company placed shares at a discount in order to invest in a range of working capital and capital investment initiatives. I believe this has put the company in a strong position to capitalise on increasing consumption and higher prices brought about by production issues overseas. At 13x trailing earnings and providing a fully franked 3.3% dividend, I think Tassal could be a good addition to most portfolios.
