Investors looking for hidden gems should keep an eye on small-cap stocks because they’re frequently overlooked by Wall Street. Many opportunities exist in this part of the market, but it is also a high-risk, high-reward environment due to the lack of reliable analyst price targets.
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 three small-cap stocks to swipe left on and some alternatives you should look into instead.
ON24 (ONTF)
Market Cap: $336.7 million
Powering over 1,700 companies' virtual marketing efforts since 1998, ON24 (NYSE:ONTF) provides a cloud-based platform that enables businesses to create interactive digital experiences and capture actionable data from customer engagement.
Why Do We Avoid ONTF?
- Products, pricing, or go-to-market strategy need some adjustments as its billings have averaged 8.1% declines over the last year
- Forecasted revenue decline of 5.1% for the upcoming 12 months implies demand will fall even further
- Suboptimal cost structure is highlighted by its history of operating margin losses
At $7.98 per share, ON24 trades at 2.5x forward price-to-sales. To fully understand why you should be careful with ONTF, check out our full research report (it’s free).
Custom Truck One Source (CTOS)
Market Cap: $1.60 billion
Inspired by a family gas station, Custom Truck One Source (NYSE:CTOS) is a distributor of trucks and heavy equipment.
Why Does CTOS Worry Us?
- 2.9% annual revenue growth over the last two years was slower than its industrials peers
- Earnings per share have contracted by 47.9% annually over the last two years, a headwind for returns as stock prices often echo long-term EPS performance
- Free cash flow margin dropped by 19.4 percentage points over the last five years, implying the company became more capital intensive as competition picked up
Custom Truck One Source is trading at $7.08 per share, or 8.2x forward EV-to-EBITDA. Check out our free in-depth research report to learn more about why CTOS doesn’t pass our bar.
Camden National Bank (CAC)
Market Cap: $839.6 million
Rooted in Maine's coastal communities since 1875, Camden National (NASDAQ:CAC) is a regional bank holding company that provides banking, wealth management, and financial services to consumers and businesses throughout Maine and New Hampshire.
Why Are We Hesitant About CAC?
- 8.3% annual net interest income growth over the last five years was slower than its banking peers
- Incremental sales over the last five years were less profitable as its 1.7% annual earnings per share growth lagged its revenue gains
- Flat tangible book value per share over the last five years suggest it must find different ways to enhance shareholder value during this cycle
Camden National Bank’s stock price of $49.54 implies a valuation ratio of 1.1x forward P/B. Dive into our free research report to see why there are better opportunities than CAC.
High-Quality Stocks for All Market Conditions
Your portfolio can’t afford to be based on yesterday’s story. The risk in a handful of heavily crowded stocks is rising daily.
The names generating the next wave of massive growth are right here in our Top 6 Stocks for this week. This is a curated list of our High Quality stocks that have generated a market-beating return of 244% over the last five years (as of June 30, 2025).
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.