3 small cap ASX shares for your watchlist

Looking for exposure to the small side of the market? Check out these shares…

| More on:

Should you invest $1,000 in National Australia Bank Limited right now?

Before you buy National Australia Bank Limited shares, consider this:

Motley Fool investing expert Scott Phillips just revealed what he believes are the 5 best stocks for investors to buy right now... and National Australia Bank Limited wasn't one of them.

The online investing service he’s run for over a decade, Motley Fool Share Advisor, has provided thousands of paying members with stock picks that have doubled, tripled or even more.*

And right now, Scott thinks there are 5 stocks that may be better buys...

See The 5 Stocks *Returns as of 30 April 2025

Two happy people use their hands as binoculars, indicating a positive ASX share price or on watch

Image source: Getty Images

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

As I'm a fan of small cap shares, I feel quite fortunate to have a large number to choose from on the Australian share market.

Three small cap ASX shares that could have bright futures are listed below. Here's why they could be worth watching:

Damstra Holdings Ltd (ASX: DTC)

The first small cap to watch is Damstra. It is an integrated workplace management solutions provider. Its cloud-based workplace management platform is used by businesses to track and keep their employees safe.

Damstra has been a positive performer over the last couple of years and has built on this in FY 2021. For example, during the first half of FY 2021, the company posted a 29.6% increase in revenue to $13.3 million. The good news is that this is still only a fraction of its total addressable market, which is expected to be worth US$20 billion by 2022.

SILK Laser Australia Limited (ASX: SLA)

Another small cap ASX share to watch closely is SILK Laser. It is a laser, skin care, and cosmetic injections company which has been growing strongly in FY 2021. For example, during the first half, SILK reported a 62% increase in network sales to $44.9 million and a 305% increase in net profit to $4.7 million.

Thanks to growing demand and store network expansion, SILK appears well-positioned to continue its growth over the next decade. In respect to the latter, at present SILK has a total of 60 clinics in operation. However, management intends to grow its network by 6 to 10 new clinics per annum up to a target of approximately 150 clinics.

Universal Store Holdings Limited (ASX: UNI)

A final small cap to watch is Universal Store. It is a fashion retailer aiming to deliver a frequently changing and carefully curated selection of on-trend products to the fashion focused customer. This focus is clearly paying off, with Universal Store a particularly positive performer this year. It delivered a 23.3% increase in first half sales to $118 million and a 63.6% increase in underlying net profit after tax to $21.1 million.

Looking ahead, the company has opportunities to expand its footprint materially over the next decade to drive further growth. Management has identified up to 60 new store sites, this is almost double the 65 stores it was operating from during the first half.

James Mickleboro does not own any shares mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. owns shares of and has recommended Damstra Holdings Ltd. The Motley Fool Australia owns shares of and has recommended Damstra Holdings Ltd. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

More on Share Market News

Businessman using a digital tablet with a graphical chart, symbolising the stock market.
Share Market News

$10,000 invested in the ASX 200 5 years ago is now worth…

Guess how much $10,000 invested in the ASX 200 five years ago is worth today!

Read more »

Retired couple hugging and laughing.
Share Market News

Eyeing retirement: Do you really need $1 million?

AustralianSuper recently weighed in.

Read more »

Happy woman working on a laptop.
Share Gainers

Here are the top 10 ASX 200 shares today

It was a pleasant end to the trading week for investors this Friday.

Read more »

Close-up of a business man's hand stacking gold coins into piles on a desktop.
Opinions

If I had a big cash pile like Warren Buffett, here's how I'd spend it in 2025

I'd put Buffett's billions to work straight away.

Read more »

Man pointing at a blue rising share price graph.
Technology Shares

Up 30% in a month, this ASX 200 tech share is 'a compelling opportunity': expert

Analysts from listed investment company WAM Capital say this ASX 200 tech stock is worth watching.

Read more »

Emotional euphoric young woman giving high five to male partner, celebrating family achievement, getting bank loan approval, or financial or investing success.
52-Week Highs

5 ASX 200 shares hitting multi-year highs after strongly rebounding from tariff turmoil

These stocks have hit new price milestones amid a day in the green for the ASX 200.

Read more »

A woman sits in a cafe wearing a polka dotted shirt and holding a latte in one hand while reading something on a laptop that is sitting on the table in front of her
Share Market News

3 key takeaways from the 2025 Macquarie Conference

More than one hundred companies presented at the Macquarie Conference this year. Here’s what we learned.

Read more »

An executive in a suit smooths his hair and laughs as he looks at his laptop feeling surprised and delighted.
Broker Notes

Brokers name 3 ASX shares to buy today

Here's why brokers are feeling bullish about these three shares this week.

Read more »