The small-cap sector has shown resilience, as highlighted in the latest report by Royce Investment. Released on January 2, 2026, the Small-Cap Recap Q4 2025 revealed that both the Russell 2000 and Russell Microcap Indexes posted gains during the last quarter of 2025. The Russell 2000 increased by 2.2%, while the Russell Microcap index surged by 6.3%, marking a significant quarterly spread between the two indexes.
On January 23, 2026, Liz Ann, Chief Investment Strategist at Charles Schwab, discussed the factors driving small-cap performance in an interview. She noted that the shift towards small and mid-cap stocks began with the Federal Reserve’s easing cycle. Despite the Fed’s current silence and diminishing prospects for interest rate cuts, small-cap stocks continue to thrive. Ann attributed this outperformance to increasing demand, particularly within the manufacturing and industrial sectors, which is fostering growth in lower market cap companies.
With this backdrop, we present ten small-cap stocks that hold potential for significant growth, based on their current market performance and analyst recommendations.
Methodology for Selection
To identify these overlooked small-cap stocks, we analyzed various rankings from reputable financial media outlets. We focused on companies with market capitalizations between $300 million and $2 billion, along with positive upside potential from analysts. We consolidated data from sources like CNN and the Wall Street Journal, and ranked the stocks based on the number of hedge fund holders as detailed in Insider Monkey’s Q3 2025 database. The data used was recorded on February 6, 2026.
Investors often look at stocks with higher hedge fund ownership because research indicates that mirroring the top stock picks of leading hedge funds can lead to better market performance. Our quarterly newsletter has seen a remarkable return of 427.7% since May 2014, outperforming benchmarks by 264 percentage points.
Highlighted Small-Cap Stocks
1. Utz Brands, Inc. (NYSE:UTZ)
Market Cap: $1.57 billion
Upside: 32.06%
Number of Hedge Fund Holders: 16
Utz Brands is preparing to announce its fiscal Q4 2025 results on February 12, 2026. Analysts project quarterly revenue around $344.65 million with a GAAP EPS of $0.27. Currently, 73% of the analysts covering the stock maintain a Buy rating, buoyed by recent bullish comments from Scott Marks of Jefferies and DA Davidson.
2. Standard Motor Products, Inc. (NYSE:SMP)
Market Cap: $970.82 million
Upside: 6.50%
Number of Hedge Fund Holders: 17
On February 2, 2026, Standard Motor Products announced a dividend increase of 6.5% to $0.33 per share. The company is expected to report Q4 2025 results on February 20, 2026, with anticipated revenues of approximately $385.91 million.
3. Getty Realty Corp. (NYSE:GTY)
Market Cap: $1.78 billion
Upside: 3.86%
Number of Hedge Fund Holders: 18
Getty Realty is set to release its Q4 2025 results on February 11, 2026. Analysts expect revenue around $55.94 million and a GAAP EPS of $0.34. The company has invested approximately $269 million in 2025, enhancing its portfolio of convenience and automotive retail assets.
4. Addus HomeCare Corporation (NASDAQ:ADUS)
Market Cap: $1.96 billion
Upside: 32.23%
Number of Hedge Fund Holders: 20
Addus is anticipated to release its fiscal Q4 2025 earnings on February 24, 2026, with expected revenues of $372.87 million and a GAAP EPS of $1.56. Analysts from Truist Financial and Bank of America Securities have issued Buy ratings, citing growth prospects in the Personal Care segment.
5. PROCEPT BioRobotics Corporation (NASDAQ:PRCT)
Market Cap: $1.61 billion
Upside: 77.45%
Number of Hedge Fund Holders: 23
PROCEPT is looking forward to its fiscal Q4 2025 earnings report on February 24, 2026, with expectations of revenue around $372.87 million. Analysts remain optimistic, with a significant upside projected, despite some concerns about the MedTech sector’s investment landscape.
6. American Superconductor Corporation (NASDAQ:AMSC)
Market Cap: $1.34 billion
Upside: 79.27%
Number of Hedge Fund Holders: 26
American Superconductor has shown strong performance, with a revenue increase of 21.38% year-over-year. Analysts from Craig-Hallum and Oppenheimer maintain Buy ratings, citing growth from organic expansion and strategic acquisitions.
7. EverQuote, Inc. (NASDAQ:EVER)
Market Cap: $650.44 million
Upside: 82.42%
Number of Hedge Fund Holders: 26
Expected to release Q4 2025 results on February 23, 2026, EverQuote anticipates revenue between $174 million and $180 million. Analysts remain bullish on the stock, with a substantial upside projection.
8. Wolverine World Wide, Inc. (NYSE:WWW)
Market Cap: $1.52 billion
Upside: 23.72%
Number of Hedge Fund Holders: 39
Despite recent downgrades based on cautious trade policy outlooks, Wolverine is expected to report Q4 2025 revenues of approximately $510.74 million.
9. Genius Sports Limited (NYSE:GENI)
Market Cap: $1.54 billion
Upside: 129.89%
Number of Hedge Fund Holders: 40
Genius Sports is in the spotlight following its acquisition of Legend. Analysts have mixed sentiments regarding the deal’s long-term impact on earnings, with expectations for continued revenue growth through 2028.
Investors looking for opportunities in the small-cap space can consider these companies as potential candidates for growth. Each stock presents unique strengths and opportunities for investment, backed by solid analyst support and market trends.
