3 Great Small Caps You’ve Never Heard Of: BJ’s Restaurants, Inc. (BJRI), Retail Opportunity Investments Corp (ROIC), Tile Shop Hldgs, Inc. (TTS)

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When it comes to investing, a certain amount of comfort can be had by holding the stocks of massive, widely known businesses.

After all, who wouldn’t want a slice of Apple Inc. (NASDAQ:AAPL)‘s giant pie after watching it sell millions upon millions of iPhones and iPads? — and that’s not to mention the staggering amount of cash the company makes from its world-class ecosystem selling digital goods to the masses. With 45 market research firms covering Apple, you can also be sure there’s plenty of material available to help you decide whether its shares are worth your money.

However, its easy to forget that every large-cap stock had to start somewhere. For investors who discovered these great businesses early on… well, one would hope they’re satisfied with their life-altering returns.

BJ's Restaurants, Inc. (NASDAQ:BJRI)Now this doesn’t mean you should rush out to mortgage your home and load up on micro-cap penny stocks. To the contrary, penny stocks can be dangerous and represent a great way to lose your shirt. Instead, consider looking for little-known small cap companies — that is, stocks with market capitalizations between $250 million and $1 billion — with sustainable underlying businesses and solid growth opportunities.

With this in mind, here are three such stocks I believe fit the bill:

Company Market Cap Est. Long- Term
Growth Rate
Analyst Coverage CAPS Rating
(out of five)
Retail Opportunity Investments Corp (NASDAQ:ROIC) $679 million 11.8% 3 *****
Tile Shop Hldgs, Inc. (NASDAQ:TTS) $756 million 18% 5 ****
BJ’s Restaurants, Inc. (NASDAQ:BJRI) $884 million 15.5% 13 ****

Sources: Yahoo! Finance, Motley Fool CAPS.

In all fairness, while these businesses are indeed small, that doesn’t mean absolutely nobody knows about them. In fact, if you currently subscribe to any of our newsletters, you may already be familiar with all three. Even so, when I mention these tickers in conversation, I’m generally greeted with a blank stare and a fake smile that cries, “Can we just get back to Apple?”

Nonetheless, here’s why you should care about these often-overlooked names.

A world of opportunity
First up, perhaps you could consider building a position in real estate investment trust Retail Opportunity Investments Corp (NASDAQ:ROIC).




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