Shaw and Partners has released research notes on two ASX small caps that it believes can deliver substantial returns over the next year.

Let’s have a look at who they like.

Objective Corp Ltd (ASX: OCL)

The Objective Corp share price fell sharply on the release of the company’s FY26 results, but Shaw and Partners believes this was an over-reaction.

The company reported revenue of $134.7 million, up 9%, and adjusted EBITDA of $51.5 million, up 11%.

It also increased its dividend from 22 cents per share to 26 cents.

The company said regarding its results:

During FY2026, 100% of our software revenue was contracted under a subscription model and recurring revenue represented 86% of total revenue from customers. The Annualised Recurring Revenue (ARR) balance at 30 June 2026 decreased by 2% to $117.3 million ($120.2 million at 30 June 2025). Information Intelligence ARR decreased by 5% to $81.0 million (FY2025: $85.1 million); Regulatory Solutions ARR increased by 4% to $17.6 million (FY2025: $16.9 million); Planning and Building ARR increased by 3% to $18.7 million (FY2025: $18.2 million).

The company said it had a strong balance sheet, which “provides significant capacity to further pursue investment opportunities that enhance returns for stakeholders”.

Shaw and Partners said Objective Corp delivered solid underlying growth despite the loss of a defence contract.

They said the company was now poised for growth:

Strategically, years of R&D investment have delivered a mature product portfolio, with the focus now shifting toward sales and monetisation. FY27 establishes a new earnings base, with sales execution key to re-accelerating growth. Reiterate Buy.

Shaw and Partners has a price target of $9.50 for Objective Corp, compared with $6.40 at the time of writing.

Humm Group Ltd (ASX: HUM)

This finance and credit card company’s shares have been on a slide in recent months, and are now down 35% over the past 12 months.

Humm Group’s full-year net profit fell from $39.6 million to $15.7 million, but Shaw and Partners said this was largely due to one-off costs associated with corporate activity.

They said they expected net profit to “materially recover” this financial year, and noted that the company was trading at a substantial discount to the small-cap financial sector.

The company itself said re the outlook:

Humm Group enters FY27 with a clear focus on disciplined execution, with the final stages of platform transformation expected to create a shift in focus from building foundations, to realising benefits. This focus will enable meaningful and cost-effective scale in the consumer portfolios, accelerate AI adoption, simplify and automate processes and deliver better experiences for customers, merchants and employees.

Shaw and Partners has a price target of 80 cents on Humm Group shares compared to 42.25 cents at the time of writing.

The post 2 ASX small caps which could deliver 50% to 90% returns appeared first on The Motley Fool Australia.

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• Objective Corporation share price crashes 18% on FY26 earnings

Motley Fool contributor Cameron England has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Objective. The Motley Fool Australia has positions in and has recommended Objective. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

Australia’s community of ASX shares investors is getting bigger and younger, according to new research from CommSec.

CommSec recorded 11.5% growth in active customers over FY26, with trading volumes up 27%, and traded value up 33%.

Millennials were the dominant investor group in FY26, representing 37% of active trading accounts.

Young investors were more proactive, with the total trade value among clients under 40 years increasing 55% in FY26.

By comparison, trade value among customers aged over 40 years rose 30%.

Gen Z (born 1997-2012) accounts for just 1.6% of the wealth held by CommSec investors, but they were the most active traders.

Gen Z represented 19% of active market participants in FY26.

CommSec said Gen Z was turning to ASX shares to build wealth because they were priced out of Australia’s property market:

Where 40 years ago, Baby Boomers and Gen Xers could buy a typical first home in Sydney or Melbourne for around 3-4 times the average salary of the time, Gen Zers face a price ratio of up to 14 times their average salary, following several decades of property values far outpacing average wage growth.

Consequently, investing in the stock market to generate capital has become an appealing alternative to property for many Gen Zers…

First-time ASX shares investors

First-time investor activity in FY26 was strongest amongst clients aged under 40 years at 66%, up from 63% in FY24.

Female investors accounted for 42% of first-time investors, up from 36% two years ago.

Overall, 66% of active investors on CommSec in FY26 were men and 34% were women.

Gillian Bowen, Head of Media and Markets at CommSec, said:

Australians are investing in greater numbers than ever before, but the path they’re taking increasingly reflects their life stage, priorities and financial circumstances.

Younger investors are entering the market earlier and are highly engaged, while older generations continue to hold significant pools of wealth built over decades.

Young Australians’ portfolios were primarily full of ASX shares.

The most traded ASX shares among Millennials were: Droneshield Ltd (ASX: DRO), PLS Group Ltd (ASX: PLS), Zip Co Ltd (ASX: ZIP), and CSL Ltd (ASX: CSL).

The most traded among Gen Z were: Droneshield, PLS Group, Zip, and Commonwealth Bank of Australia (ASX: CBA) shares.

While younger investors retained the home bias of previous generations, they were increasingly engaged in overseas markets.

Younger investors more open to international shares

Younger Australians were increasingly focusing on international shares, the research showed.

About 10% of Gen X (born 1965-1980), Millennials (1981-1996), and Gen Z portfolios on CommSec contained international shares.

That compared to 5% for Baby Boomer (born 1946-1964) portfolios.

CommSec said global tech shares featured prominently among the most traded shares for all investor groups in FY26.

The most traded US stocks among Millennials were: Tesla, Nvidia, Super Micro Computer, and Space X.

The most traded among Gen Z were: Tesla, Nvidia, ProShares UltraPro QQQ, and Direxion Daily TSLA Bull 2X ETF.

More than two-thirds of Gen Z investors held exchange-traded funds (ETFs), the largest proportion of any generation.  

The most traded ASX ETFs among Gen Z investors were: BetaShares Nasdaq 100 ETF (ASX: NDQ), iShares Global 100 ETF (ASX: IOO), iShares S&P 500 ETF (ASX: IVV), and Vanguard Australian Shares Index ETF (ASX: VAS).

Average value of portfolios

The average Gen Z shares portfolio on CommSec was worth about $20,000.

Millennials’ portfolios were worth an average $66,000.

The average Gen X shares portfolio was worth $233,000.

Baby boomers held the most wealth, with the average portfolio worth $541,000.

The average number of shares held within a portfolio was surprisingly small.

Gen Z portfolios had, on average, three stocks or ETFs.

Baby boomers had an average of eight shares in their portfolios.

The post ASX shares investors are getting younger and trading more often: CBA report appeared first on The Motley Fool Australia.

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Motley Fool contributor Bronwyn Allen has positions in Zip Co. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended BetaShares Nasdaq 100 ETF, CSL, DroneShield, Nvidia, Tesla, and iShares S&P 500 ETF. The Motley Fool Australia has positions in and has recommended BetaShares Nasdaq 100 ETF. The Motley Fool Australia has recommended CSL, Nvidia, and iShares S&P 500 ETF. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

Superannuation is an important part of building long-term wealth, but the money is generally locked away until retirement.

That is why I also like the idea of building a separate ASX share portfolio that can grow alongside it.

Here is how I would approach it.

I would make regular investing part of the plan

I would start by deciding how much money I could comfortably invest on a regular basis.

It might be $500 a month, $1,000 a month, or simply whatever is left after other financial commitments.

The important thing for me would be consistency. I would rather steadily build positions in good businesses than spend months waiting for the perfect time to enter the market.

Share prices will inevitably fluctuate, but regular investing means I can keep adding during both strong and weak periods.

I would focus on businesses that can keep growing

For a portfolio designed to build wealth outside superannuation, I would want companies with opportunities that extend well beyond the next year or two.

Xero Ltd (ASX: XRO) is the type of business I have in mind. It already serves millions of small businesses, but its potential global market is far larger. Xero can keep adding customers while expanding the financial tools available through its platform.

I would also consider businesses such as ResMed Inc. (ASX: RMD), where long-term demand could benefit from more people being diagnosed and treated for sleep apnoea.

I would not expect every investment to rocket higher. I would simply want a collection of quality businesses capable of increasing earnings and becoming more valuable over many years.

I would keep the portfolio diversified

Owning ASX shares outside superannuation also gives me the freedom to build the portfolio around my own preferences.

I could combine growth companies with more established businesses, such as big four bank National Australia Bank Ltd (ASX: NAB) or supermarket operator Coles Group Ltd (ASX: COL).

An exchange-traded fund (ETF) could make diversification even easier. The Vanguard MSCI Index International Shares ETF (ASX: VGS), for example, would give me exposure to a large collection of global companies alongside my Australian holdings.

I think that mix would make me less dependent on any one company, sector, or even the Australian economy.

I would give the portfolio a purpose

One reason I like building wealth outside superannuation is flexibility.

The portfolio could eventually help fund an earlier retirement, reduce working hours, pay for travel, or simply provide another financial asset that is accessible before preservation age.

During the building stage, I would generally reinvest dividends and leave successful investments alone.

But knowing the money is accessible gives the portfolio a different role from superannuation.

Foolish takeaway

I see an ASX share portfolio outside superannuation as something I could build quietly over many years.

Regular investing, quality businesses, and sensible diversification would form the foundation.

Over time, the goal would be to create another meaningful pool of wealth that gives me more choices well before traditional retirement arrives.

The post How I’d use ASX shares to build wealth outside my superannuation appeared first on The Motley Fool Australia.

More reading

• 11 ASX 200 shares with reaffirmed buy ratings post-results
• Top 3 ASX 200 shares that lifted their dividend this reporting season
• Xero shares jump 33% from a 7-year low: Buy, sell or hold?
• Own BHP, Woodside or Coles shares? Here’s what investors should know
• Are these ASX tech stocks finally a buy again?

Motley Fool contributor Grace Alvino has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended ResMed and Xero. The Motley Fool Australia has positions in and has recommended ResMed and Xero. The Motley Fool Australia has recommended Vanguard Msci Index International Shares ETF. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.