Three small goodies for big bad markets | Arafura drives into global rare earths scene

The good, the bad and the plain ugly stocks are being indiscriminately sold off, according to Marc Whittaker from Investors Mutual. Whittaker is looking between the lines to find value in companies with defensive qualities and strong cash generating capabilities. Starting with healthcare, Whittaker says Integral Diagnostics (IDX) is a solid business with a backlog of demand thanks to COVID-related interruptions in the sector. SkyCity Entertainment (SKC) is a late stage reopening play which leverages exposure to the New Zealand market. Its didn't get caught up in the initial rally, so there is more potential upside. Watch here to find out why GUD Holdings (GUD) is a 'buy'! | Arafura Resources (ARU) shares have soared more than 60% this year to date - cementing the rare earths producer as a must-watch small cap stock according to Carl Capolingua of ThinkMarkets. Arafura MD, Gavin Lockyer says the market is finally recognising the company's quality assets which are primarily located in the Northern Territory. Lockyer says the business is shaping up for growth and is being thoughtful around how debt is funded. Hyundai is also eyeing an offtake agreement with Arafura as competition for resources intensifies. Despite not being a material partnership, Lockyer says its a gamechanger in the sector because its the first time a tier one automaker has publicly engaged with a rare earth producer. Catch the full chat to hear why rare earths have a slew of tailwinds which Lockyer says will power demand for Arafura's product.