subject: Small Cap Shares still Under Priced on the Australian Stock Market [print this page] Small Cap Shares still Under Priced on the Australian Stock Market
Small Cap Shares still Under Priced on the Australian Stock Marke
Blue chip shares have mostly returned to their true value as well as many dividend paying shares but the small cap spec shares are still bargain priced. What are small capitalisation spec shares? Shares under 50 cents would be considered highly speculative and small cap. That does not mean all low cost shares are extremely risky and poor value on the contrary many penny shares have great prospects of becoming the "blue chips" of the future and returning bonanza percentage gains.
Some examples of low cap gems
A company share costing 1 cent that operates 35 Hotels and has 3 of the top ten gaming hotels in NSW. It's turnover was $92 million last year and was badly affected by the global financial crisis. 4 years ago this share was about 50 cents imagine the percentage profit if the company returns to it's former price.
An oil explorer and producer at around 10 cents a share that already has 2 producing oil fields and has a 35% stake in an exploration well that will be drilled in the next few months. This new well has the potential to hold more than a billion barrels of oil. Revenue last year was over $60 million and the company has over $24 million in cash.
A gold explorer that hopes to be producing within 18 months and has a estimated production cost of about $40 an ounce after credits of other included metal products. Remember the gold price now is nearly $1400 an ounce. The price of this share is around 15 cents. The company could make a profit of $100 million in the first year.
These examples are just 3 of the dozens of undervalued small capitalisation companies that have been out of favour since the worst world market crash in my lifetime. How long will it be before the penny market returns to normal ? I think it should happen this year but nobody really knows and the bargains will not last forever
What other work from home job can rival this way to gain extra income. I have tried many other ways to get money to boost my income, affiliate marketing is way too difficult to make more cash for the average person. There are other ways advertised to make easy money but the only people that make the money are the ones selling the scheme.
To trade in low cap shares you need to have a computer an internet connection and have a few thousand dollars to invest. You also need the patience and ability to research the stocks. Spread your investment dollars in the minimum $500 on each parcel of shares over 10 or 20 different companies to lessen the risk and improve your chances of picking up a couple of bonanza cash returns. Good Luck!
