Just Released: Our Top 3 Small-Cap Stocks to Consider Buying in October (PREMIUM PICKS)

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Our monthly Best Buys Now are designed to highlight our team's three favorite and most timely buys from our growing list of small-cap recommendations, to help Fools build their stock portfolios.

Why we like it: “sad (LSE: TSTL), is an innovative healthcare company based in Cambridge. Their unique disinfectant products are high margin, quick to deploy and cost-effective. The recent regulatory approval for its DUO ultrasound product in the US has allowed it to enter the world's largest ultrasound market, a significant opportunity that has been long in the making. Encouragingly, it has already onboarded a growing number of hospital clients in the US.“The company also received regulatory approval in Canada for a high-level disinfectant for ultrasound probes, bolstering its growth prospects in North America. We hope that Tristel can build on its recent progress and eventually take a position as a global market leader. “The opportunity for investors in the company is that Tristel’s top-line growth accelerates and its profitability increases as royalties from the product launch in North America come into effect.”

Why we like it now: In its latest financial year, Tristel has seen its sales and profits increase by 16% and 32%, respectively, while remaining highly cash-generating. The company ended the year with cash and equivalents of £11.8m and has no debt. The company will receive royalty income from the sale of its Tristel ULT and Tristel DUO products in the US, which should potentially be a significant source of future sales and profit growth. Earlier this year, it said its U.S. partner, Parker Laboratories, was doubling its sales force, which should help drive growth. Parker considers “impulse” is building despite the meeting “More purchasing bureaucracy than originally planned.” The company appears to be growing in valuation and while the recent CEO change could introduce risks, the company expects to see further growth in the new financial year, while the long-term opportunity still appears significant.