At the small end of the market, there are a number of ASX shares with the potential to grow strongly in the future.
Two that should be on your watchlists are listed below. Here's what you need to know about them:
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MNF Group Ltd (ASX: MNF)
MNF Group is a small cap ASX share to watch. It specialises in Voice over Internet Protocol (VoIP) technology which is used to support services like teleconferencing, online business meetings, and digital data transfers.
It looks well-placed for growth over the long term thanks to a number of favourable tailwinds. These include the NBN rollout and the work from home initiative.
The company is also expanding into the Asian market. In February it was on the cusp of entering Singapore and was looking at a further six markets in the region.
This should be supportive of further recurring revenue growth in the coming years. Speaking of which, at the end of December, its recurring revenues stood at $55.7 million. This was up 15% on the prior corresponding period.
Morgan Stanley is a fan of the company. It currently has an overweight rating and $6.30 price target on its shares.
Whispir Ltd (ASX: WSP)
Another small cap share to watch is Whispir. It is a software-as-a-service communications workflow platform provider.
Whispir provides an industry-leading software platform that allows governments and businesses to deliver actionable two-way interactions at scale using automated multi-channel communication workflows. Demand has been increasing strongly, leading to stellar recurring revenue growth in recent years.
This continued in the third quarter of FY 2021. According to the release, at the end of March, the company's Annualised Recurring Revenue (ARR) was up 20.3% over the prior corresponding period to $50.3 million. This was also up 5.2% since the end of the second quarter.
However, it is still only scratching at the surface of its TAM. Management estimates that it has a total addressable market (TAM) of US4.7 billion in the just the United States.
Ord Minnett currently has a buy rating and $4.25 price target on its shares.
