2 minnows that turned £5,000 into £10,000 in just 1 year

I always approach AIM-listed stocks with extreme caution, and you should too. So many have promising futures, but with a treacherous journey ahead of them. These two minnows will have doubled your money over the past year, but that is no guarantee they will repeat the trick. Both published results this morning, so what does the future hold?

Brain stormer

Neuroscience digital health company Cambridge Cognition Holdings(LSE: COG) has a market cap of just £30.30m. It was slightly higher this morning, but the share price is down more than 8% after publication of its interims for the six months to 30 June. Cambridge operates in a risky area, developing and marketing software products to improve brain health, so investors should expect slips along the way.

Today's results were in line with management expectations and showed a year-on-year dip in total revenues from £3.26m to £3.21m, and a loss before tax of £390,000, more than double last year's £150,000. The loss per share tripled from 0.6p to 1.8p, but at least the cash balance has grown, from £1.38m to £1.82m.

Services smile

Cambridge has been working hard to broaden its revenue base to make it less reliant on one-off large contracts, two of which temporarily boosted revenues last year. Services offered the main area of revenue growth, up 57% on last year, which should bring more revenue stability and offset the 26.1% drop in software and 78.6% drop in hardware sales that now make up a shrinking proportion of earnings.

CEO Steven Powell highlighted a 7.4% rise in gross margins and said investment in the sales team boosted its sales order pipeline by 65% to record levels. "This shift to good quality, high margin and repeat business is a welcome move and one which will help to drive our recurring revenue, giving us greater visibility as we continue to build the business."

City analysts are positive, predicting earnings per share growth of 57% this year rising to 109% in 2018. If they are right, today's drop could be a buying opportunity, but as I said, approach with caution.

Our friend Elektron

Today's half-year report to 31 July from cloud-based solutions specialist Elektron Technology(LSE: EKT) has enjoyed a warmer reception, with the share price up more than 5% at time of writing. The stock has doubled from around 7p to 15p since mid-May although with a market cap of just £28m, sudden movements in either direction can always happen.

Elektron has been boosted by growth in its internet of things business Checkit, including Tuesday's news of a contract win worth more than £225,000 annually in recurring revenue, rising to £600,000. The star of today's show was its Bulgin business, which reported a 7% rise in sales to £12.5m and a strengthened order book, up more than 20% year-on-year.

Checkit out

Group revenue rose 3% to £15.3m with the net cash balance rising from £500,000 to £2m over the year. With a strengthened Bulgin order book and the continuing rollout of Checkit, the board expects an improved trading performance in the second half. Elektron may be risky given its size, but it is also one to watch.

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Harvey Jones has no position in any of the shares mentioned. The Motley Fool UK has no position in any of the shares mentioned. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.

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