I believe the S&P/ASX SMALL ORDINARIES (Index: ^AXSO) (ASX: XSO) is home to a number of high-quality small-cap shares with extremely bright futures.
Three shares which I think are standout picks on the index at the moment are listed below. Here's why I think they could be in the buy zone today:
BWX Ltd (ASX: BWX)
Thanks to the growing popularity of its Sukin skincare range, I believe BWX is a great option for buy and hold investors. Earlier this year BWX posted a 30.2% jump in half-year net profit after tax to $8.2 million. Pleasingly, as well as strong sales growth, the strong bottom line result was partly due to improvements in its gross margin. Management's plan to transition its product mix away from low margin, low volume products appears to have paid off. With the company expanding its presence in the UK market and in China through online marketplaces, I believe there is plenty more earnings growth ahead for BWX.
Class Ltd (ASX: CL1)
I believe this cloud-based software provider for self-managed superannuation fund (SMSF) accounting has a very bright future. Last month the company advised that it now has 132,873 SMSFs on its Class Super platform. This equates to a 68% share of the cloud market. But with management estimating that just 28.2% of all SMSFs are managed in the cloud, the company clearly has a long runway for growth. Especially considering the company's ability to win customers. Class captured 80% of all SMSF migrations to the cloud in FY 2016.
National Veterinary Care Ltd (ASX: NVL)
Recent research by the RSPCA estimates that pet ownership in Australia has grown to a massive 63% of Australian households. With such high levels of pet ownership I believe demand for veterinary services is likely to grow strongly in the future. This is great news for National Veterinary Care and its growing network of veterinary businesses. But it's not just organic growth taking the company forward. The veterinary market is highly fragmented and provides the company with significant opportunities to grow through acquisitions.
