Top 10 ASX growth stocks to watch in December 2024
Read on for an overview of growth stocks, why they’re special, and a list of the top 10 ASX growth stocks in December 2024, selected based on recent market news and ranked by the largest share price return over the past 3 months.
What is an ASX growth stock?
Growth stocks are shares in companies that are expected to grow much faster than either the average growth of a company within the wider market or within its specific sector.
Instead of paying out dividends, any profits generated are ploughed back into the business to help accelerate growth. Accordingly, investors are usually hoping to make a profit on capital gains in the short term, with dividend income a potential outcome once major growth has been established.
Some of the best growth stocks, especially those occupying a specialist niche, trade at a high price-to-earnings ratio. Therefore, would-be investors usually end up paying a premium in hope of future growth. This means that growth stocks can see rapid declines if the company underperforms, even in just one quarter.
Common traits of the most popular ASX growth stocks often include holding patents or technologies that grant the company a unique marketplace advantage. Therefore, many have a loyal customer base and disproportionately high market share.
One key misunderstanding is that all growth stocks are small caps that might have weaker financials or be confined to domestic business. While many are, larger companies can also qualify as growth stocks depending on how much market share remains realistically available.
As an extreme example, US$570 billion market titan Tesla is by all accounts still a growth stock, delivering less than one million of the 66.7 million automobiles sold in 2021.
High risk, high reward?
One of the best-known rules of investing is the risk-reward ratio, whereby investors balance an equilibrium that sees higher-risk companies deliver either negative capital growth or far better rewards than comes from value or income investing.
For context, penny stock investing is generally regarded as being very high risk, but with the potential for exceptional returns.
Conversely, income stock investing through blue chip companies for dividends is relatively low risk, but returns can take years to become meaningful.
ASX growth stocks take their place somewhere in the middle. Of course, many investors choose to invest in a diversified portfolio that includes multiple different growth stocks to account for the risk of an individual failure. And in this recessionary environment, it can make sense to buy the dip slowly through dollar-cost averaging to further mitigate the chances of losing capital.
But fundamentally, all investing comes with risk. For example, Tesla proponents believe the EV trailblazer could one day become the automobile production market leader; but any threat to this goal through competition or similar could see a sharp correction in the future. Conversely, if Tesla succeeds, its future market cap may make the current valuation look small.
Another common growth stock example is biotech companies, some of which have their valuations underpinned by one drug or treatment. If the drug fails in the trial stages, their share price can collapse, as happened to Synairgen, BridgeBio Pharma, Sensorion, and Rafael, alongside countless others.
What makes ASX growth stocks special right now?
The Australian dollar recently hit a six-month high, reaching 67.7 US cents for the first time since early January. This surge is driven by the RBA’s preference for higher interest rates compared to the Fed, strong commodity prices, and signs of economic stabilisation in China. This strength in the Aussie dollar is particularly relevant for ASX stocks, influencing various sectors significantly.
Morgan Stanley forecasts a structurally higher Australian dollar for FY25, which could pose challenges for companies with substantial overseas earnings. Factors driving this include possible RBA rate hikes, favourable relative growth expectations for Australia, and strong risk sentiment tied to equities.
For ASX stocks, a stronger Australian dollar means cheaper imported goods and more expensive exports, which can push inflation down but also slow GDP growth. In the commodity markets, a rising Aussie dollar boosts risk appetite for resources, though impacts may be tempered by external factors like the upcoming US election.
The higher dollar could also spur inbound M&A activity, as investors seek valuation opportunities before significant shifts in Enterprise Value. However, sectors like healthcare and global growth stocks (e.g., Treasury Wine Estates, Aristocrat Leisure, Macquarie) may face earnings pressure if the dollar continues to rise.
In summary, while a stronger Australian dollar presents challenges for some sectors, it can benefit the broader ASX, particularly in materials, resources, and diversified financials. This dynamic is crucial for investors focused on ASX growth stocks, highlighting both opportunities and risks in the current market.
With that in mind, here is a list of ten ASX growth stocks for investors to consider.
Remember, past performance is not an indicator of future returns.
Top 10 ASX growth stocks to watch
These shares have been selected due to their substantial share price returns over the past three months. While they may not necessarily represent the best long-term growth investments, they have garnered significant investor interest.
Petratherm (ASX: PTR)
Through its focus on geothermal energy and mineral exploration, Petratherm Ltd is carving its place in Australia’s energy and resources landscape. Originally established to develop geothermal projects, the South Australian-based company has diversified into precious metals and critical minerals, tapping into the rising demand for sustainable and strategic resources. By targeting high-potential sites in mineral-rich regions, Petratherm combines green energy innovation with expertise in critical mineral exploration, positioning itself as a versatile player in the market.
What makes Petratherm compelling is its adaptability and strategic vision. Flagship projects in copper and rare earth elements align with Australia’s ambitions to lead in renewable energy and critical mineral supply chains. With a strong technical team and prudent financial management, the company is well-placed to thrive in a competitive market. For investors, Petratherm offers a unique dual play, combining green energy roots with a future-focused approach to critical resources – making it a stock to watch in the global transition to cleaner energy and advanced technologies.
Petratherm has achieved an 850% share price return over the last three months.
Market cap: $73.26 million
Ovanti (ASX: OVT)
Ovanti Ltd is an Australian fintech company specialising in digital commerce solutions across Southeast Asia. The company offers a proprietary platform that enables institutional clients to securely authenticate end-user customers and process banking, purchase, and payment transactions. Operating primarily in Malaysia and Indonesia, Ovanti’s services encompass mobile banking, digital payments, and digital services, effectively extending IT applications to mobile devices and facilitating seamless financial interactions.
Investors may find Ovanti appealing due to its strategic positioning in the rapidly growing Southeast Asian digital economy. The company’s focus on innovation and secure financial transactions aligns with the increasing demand for digital payment solutions in the region. Additionally, Ovanti’s recent initiatives, such as accelerating its entry into the US market and appointing experienced leadership, demonstrate a commitment to expansion and adaptability. These factors suggest the potential for significant growth, making Ovanti a compelling stock to monitor.
Ovanti has achieved a 500% share price return over the last three months.
Market cap: $35.83 million
Osmond Resources (ASX: OSM)
Osmond Resources Ltd is an Australian exploration company focused on discovering and developing mineral resources, particularly in gold, copper, and nickel regions. The company’s key projects are strategically located in South Australia and Western Victoria, areas known for their geological potential. Osmond Resources employs advanced exploration techniques to target underexplored sites, aiming to unlock significant mineral deposits.
The company’s success stems from its well-positioned projects, experienced management team, and commitment to responsible exploration. By focusing on commodities like gold and copper, which have strong market demand, Osmond Resources offers investors exposure to potential high-growth assets in a favourable mining jurisdiction. The company’s strategic approach and promising exploration results make it an appealing option for those looking to invest in the resource sector.
Osmond Resources has achieved a 500% share price return over the last three months.
Market cap: $36.89 million
James Bay Minerals (ASX: JBY)
James Bay Minerals Ltd is a bold Australian explorer carving a niche in the lithium and gold sectors across North America. Focused on Quebec’s mineral-rich James Bay region, the company holds 100% ownership of promising assets, including the La Grande Project, with key properties like Joule, Aero, and Aqua, renowned for their high lithium potential. In 2024, James Bay Minerals expanded its footprint with the acquisition of the Independence Gold Project in Nevada, a high-grade gold site that marks a strategic move into the US market.
This dual focus on lithium and gold positions James Bay Minerals as a strong contender in the energy transition landscape, catering to the rising demand for electric vehicle resources and gold’s enduring value. For investors, the company’s strategic portfolio, recent discoveries, and calculated expansion into lucrative US regions signal a promising trajectory. James Bay Minerals is a stock worth watching for its potential to capture key market opportunities in the evolving energy and resource sectors.
James Bay Minerals has achieved a 421.7% share price return over the last three months.
Market cap: $23.60 million
MC Mining (ASX: MCM)
MC Mining Ltd is a key player in South Africa’s coal industry, specialising in developing and producing high-quality thermal and metallurgical coal. Headquartered in Perth but with operations centred in South Africa, the company is well-positioned to capitalise on the global demand for coal used in steelmaking and energy generation. MC Mining’s flagship asset, the Makhado Project, stands out for its potential to produce premium hard-coking coal, a critical input for the steel industry, while also generating thermal coal as a secondary product.
What sets MC Mining apart is its focus on high-value metallurgical coal and its strategic location near established infrastructure in South Africa’s coal belt. With a clear plan to ramp up production and strong relationships with local stakeholders, the company is poised to benefit from rising global steel demand and regional energy needs. For investors, MC Mining offers exposure to a critical commodity and a well-executed development strategy, making it a stock to watch as global markets balance the twin challenges of industrial growth and energy security.
MC Mining has achieved a 291.9% share price return over the last three months.
Market cap: $53.99 million
SportsHero (ASX: SHO)
SportsHero Limited is revolutionising the sports fan experience through its innovative digital platform, which combines fan engagement with real-time predictions and gamified interactions. Based in Australia, SportsHero leverages cutting-edge technology to connect users with live sports, enabling them to participate in predictive games and win rewards. By merging the passion for sport with interactive tech, the company aims to capitalise on the global boom in mobile sports engagement and monetisation.
The company’s success lies in tapping into the ever-growing community of sports enthusiasts, offering a unique platform that bridges entertainment and competition. With partnerships that extend its reach into key sports markets and an expanding user base, SportsHero is positioning itself as a leader in the rapidly growing field of fan-centric digital engagement. For investors, it’s a compelling prospect, riding the wave of increasing smartphone adoption and the soaring popularity of gamified sports platforms.
SportsHero has achieved a 280% share price return over the last three months.
Market cap: $12.70 million
Noviqtech (ASX: NVQ)
Noviqtech Ltd is pushing the boundaries of innovation with its advanced technology solutions aimed at enhancing operational efficiency and data security across industries. The company specialises in providing cutting-edge hardware and software systems, combining artificial intelligence, IoT integration, and blockchain capabilities to streamline processes and safeguard critical data. Based in Australia, Noviqtech has established itself as a forward-thinking firm, leveraging technological advancements to meet the evolving demands of the digital age.
Noviqtech stands out in its commitment to delivering tailored solutions that address real-world challenges, from optimising supply chains to securing sensitive information. With a growing client base spanning diverse sectors such as logistics, finance, and healthcare, the company has carved a niche in providing scalable, future-ready technologies. As industries continue to embrace digital transformation, Noviqtech represents a stock to watch, offering investors a stake in a company poised to thrive in the tech-driven economy of tomorrow.
Noviqtech has achieved a 273.1% share price return over the last three months.
Market cap: $21.34 million
Douugh (ASX: DOU)
Douugh Ltd is a trailblazer in the world of fintech, offering a smart banking platform designed to help users take control of their financial wellness. The Sydney-based company combines artificial intelligence with intuitive app features to automate budgeting, savings, and investing. Douugh’s mission is clear: to empower individuals to achieve their financial goals with ease and transparency, challenging traditional banking norms with a customer-first approach.
What sets Douugh apart is its innovative focus on proactive money management, using AI to provide personalised insights and real-time recommendations. Its unique subscription-based model, coupled with growing adoption in key markets like Australia and the US, positions the company for significant growth in the rapidly expanding digital banking sector. For investors, Douugh presents an intriguing opportunity, riding the wave of fintech innovation and the shift towards smarter, tech-driven financial solutions.
Douugh has achieved a 233.3% share price return over the last three months.
Market cap: $9.75 million
Trigg Minerals Limited (ASX: TMG)
Trigg Minerals Ltd is an Australian exploration company focusing on antimony and gold projects. The company holds 100% ownership of the Achilles, Taylors Arm, and Spartan Antimony Projects in New South Wales, with the Achilles Project hosting Australia’s highest-grade undeveloped antimony resource. Additionally, Trigg is advancing its gold exploration efforts in Queensland’s Drummond Basin.
Investors may find Trigg Minerals appealing due to its strategic focus on antimony, a critical mineral essential for renewable energy technologies and defence applications. The company’s recent capital raise of $2.5 million, supported by strategic investors and global funds, underscores strong investor confidence in its direction. These funds are allocated to exploration and drilling activities across its antimony projects, positioning Trigg to meet the growing global demand for this vital resource.
Trigg Minerals has achieved a 230% share price return over the last three months.
Market cap: $23.89 million
Estrella Resources Ltd (ASX: ESR)
Estrella Resources Ltd is making waves in the mining sector with its focus on exploring and developing high-grade nickel and base metal projects in Western Australia. The company’s flagship Carr Boyd project, located near Kalgoorlie, sits in a highly prospective region known for its rich mineral deposits. Estrella’s exploration efforts are geared towards unlocking the potential of these assets, particularly as nickel plays a critical role in the global push for electric vehicle batteries and renewable energy technologies.
What sets Estrella apart is its commitment to targeted exploration and its ability to secure projects with significant upside potential. By focusing on metals crucial for the green energy revolution, Estrella is well-positioned to benefit from surging demand in the clean energy and technology sectors. For investors, Estrella Resources offers an exciting entry point into the evolving battery metals market, with a clear strategy to deliver long-term value through exploration success and resource development.
Estrella Resources has achieved a 220% share price return over the last three months.
Market cap: $23.55 million
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