Buy These Four High Growth Microcap Stocks Now
Microcap companies occupy a unique place in the marketplace. Their under-the-radar and high growth profiles complete an equation for outsized gains. Even on down days like today, many of these companies are unaffected as Wall St and institutions have no stake in these companies - yet.
Investing in microcap companies requires a long-term investing horizon. A sustained investment approach requires knowing exactly what you own, at all times. This also includes taking advantage of swings and illiquidity.
RDX Technologies (OTC: RGDEF) employs very advanced water treatment technologies coupled with a high gross margin energy conversion business. The company’s franchise business is set to explode due to the competitive advantages offered to businesses seeking water filtration, operators and franchisees. A multi-year agreement with COG Operating LLC and a $19.92M Contract With Pontus Energy LLC will provide valuable income streams. Also, a recent real estate sale has strengthened RDX’s cash levels. Contracts slated to be announced will act as additional growth drivers for the company. RDX has achieved high revenue growth of $6M to $31M in the last four fiscal years. The rollout of the company’s highly competitive franchising model will lead to $100M+ in 2015. RDX Technologies is executing a multi-faceted business strategy that is lucrative for operators and offers a worthwhile service for businesses. Read our extensive thesis and CEO interview.Read our extensive thesis and CEO interview.
ICTV Brands (ICTV) is a company dedicated to building recognizable brands across defined market segments, specifically, health and beauty, leisure time and children's products. ICTV leverages the power of direct response marketing, the Internet and other marketing methods to reach consumers. The company has an international network of over 35 countries in which it successfully markets and sells its products. ICTV has returned to profitability with an operating income of $160K. Looking ahead, ICTV Brands has numerous growth drivers that are not only viable, but will drive revenue to over $100M over the next 1-2 years. These growth drivers span from its flagship product DermaWand being marketed internationally and in retail stores such as Rite Aid and CVS, to the company's new products including Coral Actives and Elastin-RP. Read our ICTV update article.Read our ICTV update article.
USell is experiencing rapid growth, as revenue in 2013 increased 125% y/y and devices sold through the platform have increased 80% y/y. There is ample supply in the marketplace for uSell to capture. Consumers currently have $25B in electronics inventory to sell, with an additional $12B being added through 2014. The smartphone reCommerce marketplace is fragmented. uSell is consolidating this market by providing a service with more competitive advantages than its peers. Its valuation could grow to be $130M.Management owns nearly 30% of the company, aligning their interests with that of shareholders. An up-list to the Nasdaq is a significant and imminent near-term catalyst. An 85%+ GM, coupled with high growth and cut costs will lead to EPS of $0.35-$0.40 in 2015. A 25x P/E results in 100%+ upside potential. Read our extensive original report on uSell.
Recently, uSell's 2Q financials included that for the six month period ending June 30, 2013, the company saw a 57% increase in orders placed through their system and an increase in completed orders by 76%. Further, uSell has seen a dramatic increase in order volume with a 115% increase in Apple (AAPL) iPhone order volume over the prior year's already 40% gain. Following the two weeks after the iPhone 6's release, uSell saw order volume exceed $3M - this will bode well for uSell's top line. Read our uSell update article and detailed management interview
Crossroads (NASDAQ: CRDS) is a micro-cap, global provider of data storage and protection solutions that has gone largely unnoticed in the marketplace. Crossroads has had lackluster results over the past few years, but the future looks to hold significant potential. With new management guiding to operating breakeven, or better, for FY14, this would mark the first year in the company's history of achieving breakeven, Should this growth continue beyond FY15, with attractive 80% gross margins, we will likely see a much higher price tag on shares. Based on the fundamentals Crossroads could be a $4-$5 dollar stock by year-end and perhaps far higher should they succeed in recent litigation.
Crossroads Chairman Jeffrey Eberwein has been purchasing shares at a rapid pace through his fund - Lone Star Value Management, LLC. Crossroads also has pending IP lawsuits against Cisco (CSCO), NetApp (NTAP), Oracle (ORCL). With 62M and never losing a lawsuit in the company's '972 patent portfolio to the $82B Crossroads is targeting with their non-'972 portfolio - these assets demonstrate potential. Crossroads has another side to their business, their tape library storage solution which has numerous benefits over the competition. Crossroads has trained 73 sales representatives to market the product over the past quarter. With a $128M net operating loss to shield against future taxes, Crossroads is a unique investment solution. Read our Crossroads 3Q update now
- To view our extensive microcap reports and our management interviews, check out the newsletter section of SecretCaps.check out the newsletter section of SecretCaps. Our most recent microcap report is embargoed for members only and is not mentioned here.
The following article is from one of our external contributors. It does not represent the opinion of Benzinga and has not been edited.