9 ASX stock ideas for the next phase of the market - where precision will rule

After a difficult stretch for small and mid-caps (SMIDs), investors could be forgiven for questioning whether that particular part of the equity market still deserves its long-held reputation as the sweet spot of the market.

But for David Lloyd from Ausbil Investment Management, the attraction has never really faded. Dynamism is built into this universe. New winners graduate into the index, fallen leaders return with refreshed strategies, and specialist operators often deliver sharper earnings leverage than the broad and slow-moving portfolio exposures of the large-cap names.

Most importantly, the SMID universe gives investors the ability to take highly targeted positions.
This targeting becomes powerful when the cycle shifts. Rather than owning a diversified miner with multiple commodities moving in different directions, small and mid-cap names can offer the exact thematic investors want to back. As Lloyd explains;

“Pure play names can rerate a lot faster and they get more earnings zing as things turn because they are not weighed down by maybe a commodity or two that is not doing so well in a diversified house.”

That precision is central to Ausbil’s style-agnostic approach. Lloyd sees compelling opportunities across US housing, domestic financial platforms and selected technology enablers as the next phase of market dispersion unfolds, reminding investors why emerging leaders remain such fertile ground.

Please note, this interview was recorded Wednesday, 19 November 2025

TIME CODES

00:03 – Intro to David Lloyd and the Ausbil Emerging Leaders Fund.
00:22 – Why SMIDs still compelling.
00:39 – Constant index renewal: rising stars and turnaround stories.
01:54 – Can SMID outperformance continue?
02:08 – Pure-play resource exposure: Sandfire (SFR) vs BHP (BHP), Rio (RIO); rare earths Lynas (LYC), Arafura (ARU); lithium Pilbara (PLS).
03:30 – Benefits of being style-agnostic through macro shifts.
04:48 – Typical portfolio rotation: small, deliberate tilts.
05:54 – Targeted exposure examples: US housing via RWC (RWC), Reece (REH); platforms Hub24 (HUB), Netwealth (NWL); US consumer via Zip (ZIP).
07:07 – Finding inefficiencies: analyst depth + SMID pipeline.
08:19 – US housing as a key opportunity for next year.
08:48 – US policy ideas (50-year mortgages, portability) supporting the thesis.
09:57 – Criteria for emerging leaders; examples Zip (ZIP) and Tuas (TUA).