The Perennial Value Microcap Opportunities Trust has gained 42 per cent over the past 12 months, easily out-performing the 20 per cent rise in its benchmark ASX Small Ordinaries Accumulation Index.
Writing in its September 2018 monthly report, portfolio managers Andrew Smith and Sam Berridge said although valuations are stretched in most sectors of the market, given the scale of the investable universe in microcaps, they have still been able to assemble a portfolio with attractive valuation characteristics.
Here are 4 ASX small cap stocks the fund bought or added to in the month of September.
The Midway Limited (ASX:MWY) share price has gained 32 per cent in the last 12 months.
It is a leading company in the Australia forestry sector, primarily involved in the production and export of high quality wood fibre to producers of pulp, paper and associated products in China and Japan.
The Perennial Value Microcap Opportunities Trust said Medway provides exposure to Asian paper demand and earnings leverage to a falling Aussie dollar.
The Trust also added gold producer Silver Lake Resources (ASX:SLR) shares to its portfolio, saying the company has built a $105 million net cash position under current management, and has a falling cost outlook.
Calix Limited (ASX:CXL) shares fell 10 per cent in September, with the Trust saying the shares were sold off in anticipation of a tranche of stock being released from escrow, which the Trust bid for.
Calix is a multi-award-winning Australian technology company that is developing new processes and materials to solve global challenges.
The core technology is a world-first, patented kiln built in Bacchus Marsh, Victoria that produces mineral honeycomb, which are very highly active minerals.
Calix uses these minerals, which are safe and environmentally friendly, to improve waste water treatment and phosphate removal, help protect sewer assets from corrosion, and help improve food production from aquaculture and agriculture with reduced antibiotic, fungicide, and pesticide use.
Calix commenced trading on the ASX on July 20 this year following an oversubscribed
$8 million raising at $0.53 per share.
The Veris Limited (ASX:VRS) share price drifted lower in September despite solid director buying, including the vendor of a recently acquired business. The Trust said it continued to add to its position in Veris shares.
Veris is a national professional services business offering surveying, professional and
advisory and geospatial services.
In late August it reported revenue jumped 45 per cent higher and an almost doubling in earnings. The company is a play on east coast infrastructure spend.