Two Stocks Under 20 Cents Showcasing Growth Opportunities – SWF, ENR

Company Overview: Selfwealth Limited (ASX: SWF) provides flat fee brokerage services in Australia. Its principal activities consist of online flat fee share trading brokerage services and online investor community portal services. The company also offers various investment solutions for retail investors. Encounter Resources Limited (ASX: ENR), an Australia-based mineral exploration company, focuses on discovering copper deposits in Australia. The Company controls a portfolio of 100% owned projects in Australia’s mineral provinces that are prospective for copper, rare earths, and lithium. Kalkine’s ‘Stocks Under 20 cents’ report covers the Investment Summary, Key Financial Metrics, Risks, Outlook, SWOT Analysis, Technical Analysis along with the Valuation, Target Price, and Recommendation on the stocks.

1. Selfwealth Limited (Recommendation: Speculative Buy, Market Cap: ~AUD 33.97mn)

H1FY24 Update:

Business Update:

Key Ratios & Figures:

Key Risks and Outlook:

SWOT Analysis:

Valuation, Stock Recommendation and Technical Analysis:

The stock has declined by ~12.49% in the last 3 months and over the last 1 year, it has decreased by ~24.32%. The stock has a 52-week low and 52-week high of AUD 0.135 and AUD 0.200, respectively, and is currently trading below the average of 52-week high-low average. SWF was last covered in a report dated ‘13 February 2024’.

2. Encounter Resources Limited (Recommendation: Speculative Buy, Market Cap: ~AUD 61mn)

Result Highlights of FY23:

Business Update:

Key Ratios & Figures:

Key Risks and Outlook:

SWOT Analysis:

Valuation, Stock Recommendation and Technical Analysis:

The stock has witnessed a correction of ~6.66% in 3 months and over the last 6 months, it has decreased by ~22.22%. The stock has a 52-week low and 52-week high of AUD 0.115 and AUD 0.570, respectively, and is currently trading below the average of 52-week high-low average. ­­­­

Markets are trading in a highly volatile zone currently due to certain macro-economic issues and geopolitical tensions prevailing. Therefore, it is prudent to follow a cautious approach while investing.

Note 1: Past performance is neither an indicator nor a guarantee of future performance.

Note 2: The reference date for all price data, currency, technical indicators, support, and resistance levels is 8 March 2024. The reference data in this report has been partly sourced from REFINITIV.

Note 3: Investment decisions should be made depending on an individual’s appetite for upside potential, risks, holding duration, and any previous holdings. An ‘Exit’ from the stock can be considered if the Target Price mentioned as per the Valuation and or the technical levels provided has been achieved and is subject to the factors discussed above.

Technical Indicators Defined: -

Support: A level at which the stock prices tend to find support if they are falling, and a downtrend may take a pause backed by demand or buying interest. Support 1 refers to the nearby support level for the stock and if the price breaches the level, then Support 2 may act as the crucial support level for the stock.

Resistance: A level at which the stock prices tend to find resistance when they are rising, and an uptrend may take a pause due to profit booking or selling interest. Resistance 1 refers to the nearby resistance level for the stock and if the price surpasses the level, then Resistance 2 may act as the crucial resistance level for the stock.

Stop-loss: It is a level to protect further losses in case of unfavourable movement in the stock prices.

Disclaimer

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