A great small-cap stock combines high growth potential with strong fundamentals before the broader market notices. Many of the biggest long-term winners on the S&P/ASX Small Ordinaries Index started as overlooked micro caps.
Best ASX Small Cap Stocks
7 best ASX Small-Cap Stocks
to Watch in 2026
Identify early opportunities
What Makes a Great ASX Small-Cap
Here are the key traits experienced investors look for.
Small companies have more room to grow.
✓ a large market opportunity
✓ strong revenue growth
✓ a competitive advantage
✓ founder-led or high-quality management
✓ a strong balance sheet with strong cash flow.
Under the Radar Report has been researching and recommending asx small-cap shares to buy for 15 years in Australia.
The analyst team has tipped stocks like Afterpay, Evolution Mining, Nick Scali, Pilbara Minerals, Austal when they were micro-cap stocks. These companies have gone on to become multi-billion-dollar enterprises making their subscribers big profits. Read more about our best performers of all time.
Our track record
300+
Small Cap Stocks Tipped.
79.9%
Average Return.
87.2%
Best Buys Stock List average return.
Best ASX Small Cap Stocks 2026 to watch
In 2026 we have compiled a list of our favourite top picks.
Our advice to members is to invest in quality stocks at value prices and to check our latest buy recommendation.
7 Stock profiles: Our highlighted ASX Small-Cap Stocks for 2026
Industrials
1. Acrow Limited (ACF)
5.5% dividend yield
Acrow has gone through the capex hump to build up its construction and industrial access divisions and now is in a period of growth from growing construction activity delivering dividend growth in the lead up to Brisbane 3032 Olympics.
2. XRF Scientific (XRF)
2.8% Dividend yield
XRF is a unique mineral testing technology for mining & industrial; capital light model, high margins, self-funded growth.
Information Technology
3. Macquarie Technology (MAQ)
0% Dividend yield
Founder led. Margins will improve on growing revenues from increasing utilisation of data centres. The scale of competition is threatening but demand growth is robust.
Healthcare
4. Nanosonics (NAN)
0% Dividend yield
A high-risk stock which we see as being good value considering the growth pathway for both Trophon upgrades (probe cleaning) and the Coris rollout (endoscope cleaning).
Consumer Discretionary
5. Nick Scali (NCK)
4.1% Dividend yield
NCK has demonstrated the power of its low inventory business model, and we are supportive of the ambitious and bullish UK expansion. NCK offers Growth and Income for long term investors.
6. kogan.com (KGN)
4% Dividend yield
Operating earnings are depressed by restructuring at the New Zealand business, Mighty Ape. Reasonably priced with a very good business model.
Metals & Mining
7. Pantoro (PNR):
0% Dividend Yield
Pantoro Limited (PNR, formerly Pacific Niugini Limited) is an Australian gold miner and producer with its Halls Creek Gold Project in the Kimberley Region of Western Australia being the key operational focus. Outlook for production growth and declining costs albeit with gold price risk. Production could double in three years.
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How We Find Small Cap Opportunities?
Finding asx small-caps doesn’t happen by accident.
Our analyst team lead, led by Richard Hemming, have developed a specialist Risk Rating System, which analyses which stocks are ‘likely to be the strongest swimmers’.
Then we do ground up, in-depth, human analysis.
There is a lack of information in asx small-cap stocks. People simply don’t know about them, they are rarely covered by professional investors, and this leads to under valuation and leverage for informed investors.
We provide our top analyst recommendations and stock picks.
The biggest winners we’ve seen follow a similar pattern:
Small company → strong growth → market recognition → re-rating of the share price.
The biggest gains in the stock market rarely come from large caps.
They come from asx-listed small companies that grow into big ones.
Over the past 15 years, Under the Radar Report has analysed hundreds of small cap shares. These companies have a market cap under $500 million and we identify opportunities long before they appear on most investors’ radar.
Thousands of companies trade on the ASX. Many are speculative, underfunded, or poorly managed. The challenge is finding the right ones. Identifying the few that can deliver exceptional returns requires deep research, industry experience, and constant monitoring.
That’s exactly why, 15 years ago, we created Under the Radar Report Small Cap Research.
✓ High-conviction best ASX small cap ideas
✓ Detailed weekly research reports and valuation insights
✓ Early identification of emerging growth stories
✓ Ongoing updates and portfolio monitoring
✓ Access to 15 years of experience analysing the ASX
Congratulations. The most important thing is to start!
How much do you need to invest?
You can start with as little as $500 and build up your portfolio into a thriving asset, one stock at a time.
Look at our free beginners’ investment guide .
If you are serious about investing and need help choosing your first stocks, start with our Portfolio Builder course. Follow our step-by-step program and we have you investing in 6 stocks plus building up your core ETF in the first 12-months!
The most important thing about investing in the stock market, is that you start!
Contact our team now and we’ll come straight back to you.
[email protected]
Our team of market experts filters through over 2,000 stocks and only recommend a stock to buy if they personally would invest in it too. We analyse key metrics including:
- balance sheet, profit & loss and cash flow statements.
- interview the management team. This is particularly important for smaller companies
- review performance metrics, the EPS and future growth potential.
- Strong earnings growth
- Solid dividend yields for all blue chips and 50% of small caps.
- Clear price targets for future performance for all blue chip stocks.
Yes! We have a special UTRR Starter pack to get you going!
Dive into our easy to read summaries and choose the best stocks for your portfolio using our list of Best Stocks To Buy now + risk ratings.
- 1 x Small Cap Report: Get this week’s report! Value $13.00
- 1 x Blue Chip Report: Get the most recent report! Value $9.45
- 1 x Blue Chip Banking Report: Value $19.95
- 1 x Small Cap Energy & Mining Report: Value $19.95
- Bonus: $500 Strategy. Getting started in the first 3 months investing. Value $25.00
- Get a taste with Under the Radar’s team for $50!
Find our Next ASX small-cap picks the Market Does
It’s much easier for small cap stocks to double or triple in revenue & size than for large Blue Chip stocks to grow 5 or 10%.
Richard Hemming
Head of Investments
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