The ASX minnow whose shares have surged 70pc this year

“This is a business that is growing fast, has good retention and is profitable,” Mr Cooper said.

“It’s a great business that’s [share price has] gone sideways for two years. Had it not been a market where people weren’t investing in technology, this stock would have continued to go up year-over-year and now investors have an opportunity to buy something that they know can continue to grow.

“What truly sets Dropsuite apart, is that it is achieving this impressive growth whilst being profitable and producing positive cashflow – this is a rare combo on the ASX for software stocks.”

Its suite of back-up solutions cover websites, email, servers and productivity software including Microsoft 365, Google Workplace and Quickbooks.

Dropsuite sells its solutions via hundreds of direct resellers and thousands of indirect managed service providers (MSP), who take on the responsibility for managing a customer’s IT environment for a monthly or annual fee.

In the first quarter ended March 31, Dropsuite was cashflow positive and passed 1 million paid users, while annual recurring revenue grew 66 per cent year-on-year to $28.2 million.

Founded in 2011 and listed on the ASX in 2016 via a reverse takeover of Excalibur Mining, Dropsuite has also benefitted from the rising threat of ransomware attacks.

Its products allow businesses to restore a clean back-up of their data if they fall victim to a cyberattack which encrypts their systems and demands a ransom.

“While there is still three quarters to go, we see no evidence of any macro slowdown here. Dropsuite’s dual leverage to both cybersecurity spend and the growing MSP channel appear to be working strongly in its favour,” Mr Cooper said.

Shane Fitzgerald, portfolio manager and co-founder of Monash Investors, which has taken a position in the company, said there is a large market for Dropsuite’s products, with research showing more than 80 per cent of small businesses in the US don’t back up their critical data.

“What makes this stock interesting right now is the growing need for this service,” Mr Fitzgerald said.

“If you are looking for exposure to cybersecurity there’s not that many [companies] you can find on the ASX. Dropsuite is tangential to cybersecurity.”