2 ASX small cap shares tipped for big things

It’s worth remembering that all companies start somewhere and don’t become Afterpay Ltd (ASX: APT) overnight.

Two ASX shares that are still at the start of their journeys and have been tipped to have bright futures are listed below. Here’s what you need to know about them:

Mach7 Technologies Ltd (ASX: M7T)

Mach7 is a $286 million developer of enterprise imaging and informatics solutions for image viewing, storage, and workflow management. These solutions can be implemented individually or as a comprehensive end-to-end image management and diagnostic viewing platform. They have been designed to assist healthcare organisations with removing technology limitations to ensure patient information flows easily and can be accessed instantly.

Earlier this month the company announced a seven-year contract with Trinity Health for the license and associated support services for its eUnity enterprise viewer. The total value of this contract is A$5.26 million. Trinity Health is the fifth largest healthcare Integrated Delivery Network (IDN) in the United States and will be installing it across multiple facilities within its 92 hospitals located across 22 US states.

This news went down well with Morgans, which has reiterated its add rating and $1.49 price target on the company’s shares. It notes this could be the first of many deals due to its material tender pipeline. The Mach7 share price ended the week at $1.22.

MyDeal.com.au Limited (ASX: MYD)

MyDeal.com.au is an online retail marketplace provider with a market capitalisation of $300 million. The company has a focus on furniture, homewares, appliances, technology, baby products, and hardware. This focus has delivered strong results so far in FY 2021, with the company recently revealing first quarter gross sales growth of 317% to $56.67 million. This strong growth was driven by the accelerating shift to online shopping and a 268% increase in active customers to 669,897 compared to the prior corresponding period.

Another positive is the company has $40 million from its recent initial public offering (IPO) that can be used to drive future growth. This includes growing its private label business, investing in its proprietary technology, and investing in advertising to grow its customer base and brand.

One broker that likes what it sees here is RBC Capital Markets. It has just initiated coverage on MyDeal with a buy rating and $1.60 price target. It thinks the company is at an inflection point as annualised gross transaction value exceeds $200 million and customer numbers approach 700,000. The MyDeal share price last traded at $1.16.

More reading

• Are these the new paths for growth of the Afterpay (ASX:APT) share price?
• I have too many tech shares: Do I sell, buy or hold?
• Is the Afterpay (ASX:APT) share price a buy today?
• Top brokers name 3 ASX shares to buy today
• Afterpay (ASX:APT) share price under pressure by US BNPL giant

James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and recommends MACH7 FPO. The Motley Fool Australia owns shares of AFTERPAY T FPO. The Motley Fool Australia has recommended MACH7 FPO. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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