Small-cap stocks can be incredibly lucrative investments because their lack of analyst coverage leads to frequent mispricings. However, these businesses (and their stock prices) often stay small because their subscale operations make it harder to expand their competitive moats.
The downside that can come from buying these securities is precisely why we started StockStory - to isolate the long-term winners from the losers so you can invest with confidence. That said, here are two small-cap stocks that could be the next big thing and one that could be down big.
One Small-Cap Stock to Sell:
Impinj (PI)
Market Cap: $3.96 billion
Founded by Caltech professor Carver Mead and one of his students Chris Diorio, Impinj (NASDAQ: PI) is a maker of radio-frequency identification (RFID) hardware and software.
Why Does PI Worry Us?
- Anticipated sales growth of 9.3% for the next year implies demand will be shaky
- Persistent operating margin losses suggest the business manages its expenses poorly
- Negative returns on capital show that some of its growth strategies have backfired
Impinj’s stock price of $143.74 implies a valuation ratio of 67.6x forward P/E. Read our free research report to see why you should think twice about including PI in your portfolio.
Two Small-Cap Stocks to Buy:
Astronics (ATRO)
Market Cap: $3.39 billion
Integrating power outlets into many Boeing aircraft, Astronics (NASDAQ: ATRO) is a provider of technologies and services to the global aerospace, defense, and electronics industries.
Why Will ATRO Beat the Market?
- Impressive 14.5% annual revenue growth over the last five years indicates it’s winning market share this cycle
- Additional sales over the last two years increased its profitability as the 349% annual growth in its earnings per share outpaced its revenue
- Returns on capital are increasing as management’s prior bets are starting to bear fruit
At $76.93 per share, Astronics trades at 28.6x forward P/E. Is now the right time to buy? See for yourself in our full research report, it’s free.
BGC (BGC)
Market Cap: $5.37 billion
Tracing its roots back to 1945 and named after founder Bernard Gerald Cantor, BGC Group (NASDAQ: BGC) operates a global brokerage and financial technology platform that facilitates trading across fixed income, foreign exchange, equities, energy, and commodities markets.
What Makes BGC Stand Out?
- Impressive 24.8% annual revenue growth over the last two years indicates it’s winning market share this cycle
- Earnings growth has massively outpaced its peers over the last two years as its EPS has compounded at 24.6% annually
- Acceptable return on equity suggests management generated shareholder value by investing in profitable projects
BGC is trading at $11.05 per share, or 7.5x forward P/E. Is now the time to initiate a position? Find out in our full research report, it’s free.
Stocks We Like Even More
ONE MORE THING: Top 5 Growth Stocks. The biggest stock winners almost always had one thing in common before they ran. Revenue growing like crazy. Meta. CrowdStrike. Broadcom. Our AI flagged all three. They returned 315%, 314%, and 455%, respectively.
Find out which 5 stocks it’s flagging this month — FREE. Get Our Top 5 Growth Stocks for Free HERE.
Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,326% between June 2020 and June 2025) as well as under-the-radar businesses like the once-small-cap company Exlservice (+354% five-year return). Find your next big winner with StockStory today.
