In this article, we will look at the 10 Cheap Small Cap Stocks to Buy Now.
On June 26, Ed Yardeni, Yarden Research president, appeared on CNBC’s ‘Squawk on the Street’ to talk about the latest market trends, his take on hyperscalers, and more.
He talked about how he believes in FEMO, which stands for Fabulous Earnings Momentum, and stated that he has been bullish enough on earnings as we have had “fabulous earnings momentum”. He believes that from an earnings standpoint, the market looks “very solid” and that we are experiencing a “June swoon” in some areas, with the market experiencing what he calls the “AI fatigue” in others.
READ ALSO: 15 Safe Stocks for Beginners to Buy in 2026 AND 15 Best Trending AI Stocks to Watch in 2026.
He said that they have been beating up trying to figure out how this all plays out, and we may be seeing another deep-sea kind of moment here, with concerns that the Chinese are once again coming out with cheaper models. Yardeni also cited the other issues about how profitable this business is going to be. However, he also stated that clearly, the demand for hardware is “very, very strong”, and the companies are going to continue building the data centers and having a “very, very positive” impact on the economy.
With these broader market trends in view, let’s look at the cheap small cap stocks to buy now.
Our Methodology
We used the Finviz stock screener to identify the best small-cap stocks with a forward P/E below 15. We then selected the top 10 stocks most popular among hedge funds as of Q1 2026, using the hedge fund sentiment data from Insider Monkey’s database. The stocks are arranged in ascending order of hedge fund sentiment.
Note: All data was recorded on June 28.
Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Insider Monkey’s quarterly newsletter strategy selects 14 small-cap and large-cap stocks every quarter and has returned 599.2% since May 2014, beating its benchmark by 372 percentage points (see more details here).
10 Cheap Small Cap Stocks to Buy Now
10. Willis Lease Finance Corporation (NASDAQ:WLFC)
Number of Hedge Fund Holders: 11
Willis Lease Finance Corporation (NASDAQ:WLFC) is one of the best cheap small cap stocks to buy now. Willis Lease Finance Corporation (NASDAQ:WLFC) announced on June 23 that its shareholders approved a three-for-one forward stock split of the company’s common stock, as well as a proportionate increase in the number of authorized shares of common stock to accommodate the stock split. Management stated that the company’s Board of Directors also approved the split, which will be effected through an amendment to Willis Lease Finance Corporation’s (NASDAQ:WLFC) certificate of incorporation.
The company further reported that all shareholders of record as of the close of trading on July 6, 2026, will receive two additional shares for every one share held on the record date upon effectiveness of the Amendment. It added that, subject to final approval by Nasdaq, the company expects trading to begin on a split-adjusted basis at market open on July 20, 2026. Charles F. Willis, Executive Chairman of Willis Lease Finance Corporation (NASDAQ:WLFC), also stated:
“Including the stock split, all five proposals on our 2026 proxy were passed by shareholders. Over the past several years, we have built meaningful momentum across the business, further positioning the Company to capitalize on growth opportunities and create value for shareholders.”
Willis Lease Finance Corporation (NASDAQ:WLFC) provides aviation services and operating leases of aircraft engines, commercial aircraft, and other aircraft-related equipment to air carriers, manufacturers, and overhaul/repair facilities. The company’s operations are divided into Leasing and Related Operations, and Spare Parts Sales.
9. S&T Bancorp, Inc. (NASDAQ:STBA)
Number of Hedge Fund Holders: 12
S&T Bancorp, Inc. (NASDAQ:STBA) is one of the best cheap small cap stocks to buy now. S&T Bancorp, Inc. (NASDAQ:STBA) received a rating update from Piper Sandler on June 26. The firm lifted the price target on the stock to $51 from $45 and maintained a Neutral rating on the shares, stating that it adjusted price targets in the Northeast bank group as part of a fiscal Q2 earnings preview.
For additional reference, in its financial results for fiscal Q1 2026, S&T Bancorp, Inc. (NASDAQ:STBA) reported net income of $35.1 million for the quarter, compared to $34.0 million for fiscal Q4 2025 and $33.4 million for fiscal Q1 2025. Diluted earnings per share came up to $0.94 for fiscal Q1 2026, reflecting an increase of $0.05, or 5.6%, compared to $0.89 for fiscal Q4 2025, and an increase of $0.07, or 8.0%, compared to $0.87 for fiscal Q1 2025.
S&T Bancorp, Inc. (NASDAQ:STBA) is a bank holding company that provides commercial, consumer, and small business banking services. The company’s operations are divided into the following segments: Commercial Real Estate, Commercial and Industrial, Commercial Construction, Business Banking, Consumer Real Estate, and Other Consumer.
