In this article, we will look at the 10 Cheap Small Cap Stocks to Invest In Now.
On December 4, Warren Pies, co-founder and strategist at 3Fourteen Research, appeared on CNBC’s “Money Movers” team to talk about the markets going into the end of 2025 and the outlook for 2026.
He stated that they are ending the year where they started, which is overweight equities and a pretty bullish outlook in general. While they haven’t published their official target for next year, their big picture view is that earnings are going to come in at a double-digit growth rate.
READ ALSO: 10 Best Low Volatility Large Cap Stocks to Invest In and 13 Best Large Cap Stocks to Invest in For the Long Term.
In addition, contrary to consensus expectations, he does not see multiple contractions next year. He stated that everyone looks at the average historic P/E ratio and assumes that the market is overweight, which is something he would push back against, saying that multiples, if anything, have modest expansion next year.
Putting all of this together shows a bullish 2026, according to Pies. His outlook does not see a recession, as he believes the economy is in a “muddle through” or “soft landing” environment. In addition, he expects three rate cuts from the Fed next year, and a “hawkish” cut at next week’s meeting. Pies also stated that he anticipates the 10-year yield curve to flatten in H1 2026 before steepening in H2 2026.
With these trends in view, let’s look at the best cheap small cap stocks to invest in now.
Our Methodology
We used Finviz to compile a list of small cap stocks with a forward P/E below 15 selected the top 10 with the highest number of hedge fund holders as of Q3 2025, sourcing the hedge fund sentiment data from Insider Monkey’s database. The list is sorted in ascending order of hedge fund sentiment.
Note: All data was recorded on December 4.
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. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 427.7% since May 2014, beating its benchmark by 264 percentage points (see more details here).
10 Cheap Small Cap Stocks to Invest In Now
10. Fidelis Insurance Holdings Limited (NYSE:FIHL)
Forward P/E: 10.1
Market Cap: $1.93 billion
Number of Hedge Fund Holders: 16
Fidelis Insurance Holdings Limited (NYSE:FIHL) is one of the best cheap small cap stocks to invest in now. On November 19, Goldman Sachs lifted the price target on Fidelis Insurance Holdings Limited (NYSE:FIHL) to $17 from $16.50 while keeping a Sell rating on the stock. The firm told investors that it updated its model after the company released its fiscal Q3 earnings report.
Fidelis Insurance Holdings Limited (NYSE:FIHL) released its fiscal Q3 2025 earnings on November 12, reporting gross premiums written of $797.5 million, reflecting a 7.5% growth compared to Q3 2024. Net income for the quarter was $130.5 million, or $1.24 per diluted common share, while operating net income was $126.8 million, or $1.21 per diluted common share.
Fidelis Insurance Holdings Limited (NYSE:FIHL) also reported that the gross premium written for the nine months ended September 30, 2025, reached $3.7 billion, reflecting a growth of 8.4% from the comparable period last year.
In addition to Goldman Sachs, UBS also raised the price target on Fidelis Insurance Holdings Limited (NYSE:FIHL) to $24 from $23 on November 17 and maintained a Buy rating on the shares.
However, on November 14, Keefe Bruyette slashed the price target on the stock to $23 from $24 while maintaining an Outperform rating on the shares. The firm told investors that the current share price of Fidelis Insurance Holdings Limited (NYSE:FIHL) undervalues the solid book value growth that it anticipates from accretive share repurchases and strong underwriting prospects.
Fidelis Insurance Holdings Limited (NYSE:FIHL) is a global specialty insurer that leverages strategic partnerships to provide tailored and innovative insurance solutions. The company’s operations are divided into the following segments: Insurance and Reinsurance.
9. Sylvamo Corporation (NYSE:SLVM)
Forward P/E: 13.6
Market Cap: $1.90 billion
Number of Hedge Fund Holders: 20
Sylvamo Corporation (NYSE:SLVM) is one of the best cheap small cap stocks to invest in now. Bank of America Securities analyst George Staphos reiterated a Buy rating on Sylvamo Corporation (NYSE:SLVM) on December 2 and set a $59 price target.
In a separate development, Sylvamo Corporation (NYSE:SLVM) announced on November 10 that its board of directors unanimously adopted a limited-duration shareowner rights plan for the protection of the interests and maximization of value for all shareowners, effective immediately. The rights plan was adopted after Atlas Holdings directed its two affiliated directors to resign, resulting in the termination of the 2023 cooperation agreement between Atlas and Sylvamo. Resultantly, after November 13, Atlas would not be subject to standstill restrictions under the cooperation agreement.
Sylvamo Corporation (NYSE:SLVM) reported that the rights plan is specially designed “to allow Sylvamo shareowners to realize the long-term value of their investment”, and it “reduces the likelihood that any person or group could gain control of the company through open market or private accumulation of Sylvamo shares without appropriately compensating shareowners for such control or providing the board sufficient time to make informed decisions”.
Applicable equally to all future and current shareholders, management reported that the rights plan was not adopted in response to particular proposals pertaining to the acquisition of partial or full control of the company, and is not intended to “deter or preclude the board from considering offers that are in the best interests of all shareowners.”
Sylvamo Corporation (NYSE:SLVM) is a paper company that manufactures uncoated freesheet for paper products, such as cut size and offset paper, and also markets coated unbleached kraft papers, pulp, and aseptic and liquid packaging board. Its operations are divided into the following geographical segments: Europe, Latin America, and North America.
8. John Wiley & Sons, Inc. (NYSE:WLY)
Forward P/E: 9.47
Market Cap: $1.86 billion
Number of Hedge Fund Holders: 23
John Wiley & Sons, Inc. (NYSE:WLY) is one of the best cheap small cap stocks to invest in now. John Wiley & Sons, Inc. (NYSE:WLY) released its fiscal Q2 2026 results on December 4, reporting a revenue of $422 million compared to $427 million in the prior year period, including foregone revenue of $3 million from divested businesses. Operating income for the quarter rose 14%, and diluted EPS also rose 14% to $0.84 compared to $0.74 in the prior year period. Adjusted EPS of $1.10 for the quarter was up 12% at constant currency, with operating performance offsetting a higher adjusted effective tax rate.
John Wiley & Sons, Inc. (NYSE:WLY) also reported that the Q2 research revenue grew 6% as reported to $279 million, driven primarily by a 7% growth in Research Publishing, including AI revenue of $5 million. Similarly, article submissions and output experienced a 28% and 12% growth, respectively, with all key geographies exhibiting notable performance.
The company added that it is reaffirming its full year outlook for adjusted EBITDA margin, adjusted EPS, and free cash flow, while narrowing its revenue guidance to the low end of the range, primarily to take into account market challenges in Learning. It expects the Research and AI momentum to remain strong.
John Wiley & Sons, Inc. (NYSE:WLY) provides research and learning materials and operates through the following segments: Research, Learning, and Held for Sale or Sold.
7. Central Garden & Pet Company (NASDAQ:CENT)
Forward P/E: 12.22
Market Cap: $1.95 billion
Number of Hedge Fund Holders: 23
Central Garden & Pet Company (NASDAQ:CENT) is one of the best cheap small cap stocks to invest in now. On November 25, KeyBanc analyst Bradley Thomas reiterated a bullish stance on Central Garden & Pet Company (NASDAQ:CENT), maintaining a Buy rating with a $50 price target. The same day, Canaccord Genuity analyst Brian McNamara also maintained a Buy rating on the stock and set a price target of $50.
The ratings followed Central Garden & Pet Company’s (NASDAQ:CENT) release of fiscal Q4 2025 results on November 24, with net sales for fiscal 2025 reaching $3.1 billion compared to $3.2 billion in the prior year. The company delivered fiscal 2025 GAAP EPS of $2.55 compared to $1.62, and non-GAAP EPS of $2.73 versus $2.13. 2025 thus marked a record year on the bottom line for Central Garden & Pet Company (NASDAQ:CENT), marked by the disciplined execution of its Cost and Simplicity agenda and continued margin expansion.
Management expects fiscal 2026 non-GAAP EPS to be $2.70 or better, and stated that while the external dynamic is continuing to be dynamic, the company is confident that its Central to Home strategy and team position would allow it to build on this momentum in fiscal 2026.
Central Garden & Pet Company (NASDAQ:CENT) produces and distributes branded and private label products for the garden, lawn, and pet supplies markets. The company’s operations are divided into the Pet and Garden segments.
6. Century Communities, Inc. (NYSE:CCS)
Forward P/E: 12.4
Market Cap: $1.94 billion
Number of Hedge Fund Holders: 24
Century Communities, Inc. (NYSE:CCS) is one of the best cheap small cap stocks to invest in now. Century Communities, Inc. (NYSE:CCS) was downgraded to Underweight from Neutral by JPMorgan on December 4, with the firm bringing the price target down to $56 from $62.
The firm expects an unfavorable demand-supply backdrop in 2026 and is maintaining a cautious stance on the homebuilders sector, as it may bring downside risk and additional pressure for builder fundamentals. JPMorgan clarified that builder fundamentals are likely to remain “relatively weak” in 2026, primarily due to the continuing downside risk to estimates because of a demand/supply industry backdrop that remains challenged.
In a separate development, Century Communities, Inc. (NYSE:CCS) announced that its Century Complete brand expanded its offerings and is now selling new homes from the mid $300s at The Timbers, a new community located halfway between Ann Arbor and Detroit.
The new offerings at The Timbers include modern homes with open-concept layouts and floor plans featuring up to 5 bedrooms and 2,180 square feet, along with unfinished basements. Offering three two-story floor plans, homebuyers at this location would also find private studies, game rooms, main-floor bedrooms with a bath, and flex rooms per plan.
Century Communities, Inc. (NYSE:CCS) is involved in the design, development, construction, marketing, and sale of single-family attached and detached houses. The company operates through the following segments: West, Mountain, Texas, Southeast, Century Complete, and Financial Services.
5. ASGN Incorporated (NYSE:ASGN)
Forward P/E: 9.95
Market Cap: $1.94 billion
Number of Hedge Fund Holders: 26
ASGN Incorporated (NYSE:ASGN) is one of the best cheap small cap stocks to invest in now. On December 3, BMO Capital analyst Jeffrey Silber reiterated a Buy rating on ASGN Incorporated (NYSE:ASGN) with a $57 price target. While Truist also maintained a Buy rating on the stock on November 21, it lowered the price target to $50 from $65.
The firm told investors that the company’s Investor Day presentation entailed above-consensus financial targets, with management highlighting meaningful opportunities to help clients with AI as companies look towards ASGN Incorporated (NYSE:ASGN) for measurable outcomes from investments in automation. Although Truist acknowledged that AI could prove to be a catalyst for the company, it also stated that “automation presents risks for the company”.
Separately, ASGN Incorporated (NYSE:ASGN) announced plans on November 20 to transition to Everforth, a new parent brand that will unify the company’s six current brands under a “single, dynamic entity”. These current brands include Apex Systems, Creative Circle, CyberCoders, ECS, GlideFast, and TopBloc. The company would continue operations under its existing commercial and government brands during the transition.
Management stated that the move marks a significant milestone in ASGN Incorporated’s (NYSE:ASGN) ongoing evolution and would help the company drive operational efficiencies across the enterprise while delivering value to clients and deepening partner collaboration, as the initiative would merge complementary strengths and resources under the Everforth brand.
ASGN Incorporated (NYSE:ASGN) provides information technology services and solutions, and operates through the Commercial and Federal Government segments. The Commercial segment provides creative digital marketing, consulting, and permanent placement services, while the Federal Government segment provides mission-critical solutions.
4. Marriott Vacations Worldwide Corporation (NYSE:VAC)
Forward P/E: 8.02
Market Cap: $1.91 billion
Number of Hedge Fund Holders: 33
Marriott Vacations Worldwide Corporation (NYSE:VAC) is one of the best cheap small cap stocks to invest in now. Marriott Vacations Worldwide Corporation (NYSE:VAC) received a rating update from Stifel Nicolaus analyst Simon Yarmak on December 5, who maintained a Buy rating on the stock with a $70 price target.
In a separate development, the company announced leadership changes on November 11 and November 10. On November 11, it announced the retirement of Brian E. Miller, President, Vacation Ownership, on December 31, 2025, after which he would remain an advisor to the company’s President and Chief Executive Officer through March 27, 2026.
On November 10, Marriott Vacations Worldwide Corporation (NYSE:VAC) announced that its Board of Directors appointed Matthew (Matt) E. Avril, an independent director of MVW, as Interim President and Chief Executive Officer, effective immediately. The appointment came after the departure of John Geller as President and CEO of MVW and as a director of the Company. Management reported that the Board of Directors has commenced the search for a permanent President and CEO.
Separately, Marriott Vacations Worldwide Corporation (NYSE:VAC) announced its fiscal Q3 2925 results on November 5, stating that the consolidated contract sales reached $439 million in the quarter. Net loss attributable to common stockholders in the quarter was $2 million, and diluted loss per share was $0.07.
Management stated that it is “not satisfied” with the company’s performance and is taking concrete steps to expedite a return to growth. These include a realignment of sales and marketing field incentives to support strong productivity, implementation of FICO-based screening to drive improved VPGs and improve lead quality, and the curbing of third-party commercial rental activity to propel higher owner arrivals and satisfaction. Marriott Vacations Worldwide Corporation (NYSE:VAC) continues to expect a $150 million to $200 million Adjusted EBITDA benefit by the end of 2026 from its modernization program.
Marriott Vacations Worldwide Corporation (NYSE:VAC) is a global vacation company involved in vacation ownership, rental and resort and property management, and other related products, services, and businesses. Its operations are divided into the Vacation Ownership and Exchange & Third-Party Management segments.
3. Simply Good Foods Company (NASDAQ:SMPL)
Forward P/E: 9.99
Market Cap: $1.90 billion
Number of Hedge Fund Holders: 35
Simply Good Foods Company (NASDAQ:SMPL) is one of the best cheap small cap stocks to invest in now. Simply Good Foods Company (NASDAQ:SMPL) received a rating update from Bernstein analyst Alexia Burland Howard on November 21, who maintained a Buy rating on the stock and set a price target of $28. However, Mizuho lowered the price target on the stock to $35 from $43 on November 12 while maintaining an Outperform rating, citing the cost inflation and extended distribution declines for Atkins causing a delay in the company’s expected EBITDA acceleration for the target cut.
In addition, Simply Good Foods Company (NASDAQ:SMPL) reported solid fiscal year 2025 results on October 23, with net sales of $369.0 million in fiscal Q4 2025 and a net loss of $12.4 million versus net income of $29.3 million. Adjusted diluted EPS for the quarter reached $0.46 compared to $0.50 in the prior year period.
In fiscal year 2025, Simply Good Foods Company (NASDAQ:SMPL) reported a 9% growth in net sales on a reported basis and 3% Adjusted EBITDA growth. Organic net sales also rose 3%, supported primarily by the continued strong double-digit consumption for both Quest and OWYN.
Management added that the company largely completed the integration of OWYN, leveraged its strong cash flow to improve its balance sheet, and invested meaningfully in its brands despite inflationary pressures. The company’s fiscal year 2026 outlook shows net sales expected between -2% and +2% year-over-year, and gross margins expected to decline between 100 and 150 basis points year-over-year.
Simply Good Foods Company (NASDAQ:SMPL) is a consumer packaged food and beverage company that develops, sells, and markets nutritional food and snacking items. The company’s product portfolio includes snacks, frozen meals, protein bars, ready-to-drink shakes, and frozen meals under the Quest and Atkins brands.
2. United Parks & Resorts Inc. (NYSE:PRKS)
Forward P/E: 8.88
Market Cap: $1.98 billion
Number of Hedge Fund Holders: 37
United Parks & Resorts Inc. (NYSE:PRKS) is one of the best cheap small cap stocks to invest in now. Truist slashed the price target on United Parks & Resorts Inc. (NYSE:PRKS) to $47 from $61 on December 4, but maintained a Buy rating on the shares. The rating update came as part of a broader research note on Lodging names, with the firm telling investors that it is updating its price targets and models in the industry to take into account the Q3 results.
United Parks & Resorts Inc. (NYSE:PRKS) released its fiscal Q3 2025 results on November 6, reporting that attendance was 6.8 million guests, a drop of around 240 thousand guests or 3.4% compared to the prior year period. Total revenue for the quarter also dropped $34.1 million or 6.2% to $511.9 million.
Attendance for the first nine months of 2025 was 16.4 million guests, also reflecting a decrease of around 252 thousand guests or 1.5% compared to the first nine months of 2024. Total revenue dropped $51.9 million or 3.9% to $1.289 billion compared to the prior year period.
Management reported that results in the quarter were negatively affected by poor weather during the peak holiday season, an unfavorable calendar shift, less-than-optimal execution, and a drop in international visitation. It added that while the consumer environment in the US appears inconsistent, as reflected in several other leisure and hospitality businesses as well, the company is expecting to do better.
United Parks & Resorts Inc. (NYSE:PRKS) owns and operates theme parks. The company’s portfolio includes SeaWorld, Busch Gardens, Aquatica, Discovery Cove, Sesame Place, and Sea Rescue.
1. The Chemours Company (NYSE:CC)
Forward P/E: 13.26
Market Cap: $1.94 billion
Number of Hedge Fund Holders: 42
The Chemours Company (NYSE:CC) is one of the best cheap small cap stocks to invest in now. On December 3, JPMorgan slashed the price target on The Chemours Company (NYSE:CC) to $13 from $15, maintaining a Neutral rating on the stock.
The rating update came after the company’s fiscal Q3 2025 earnings release on November 6, reporting that net sales for the quarter were $1.5 billion, flat compared to the prior-year quarter, driven primarily by a 3% decrease in volume, a 1% increase in price, and a 1% currency tailwind. The drop in volumes was attributed to operational impacts associated with the now resolved outage at APM’s Washington Works site, along with demand weakness in industrial end markets. Management stated that these trends were partially offset by the continued strength in TSS volumes, supported by the demand for Opteon™ Refrigerants.
The Chemours Company (NYSE:CC) further reported that adjusted EBITDA for fiscal Q3 2025 was $195 million, compared to $202 million in the prior year period, with the drop primarily driven by higher costs due to now resolved operational disruptions in the TT business and the previously referenced APM outage.
The company expects consolidated net sales to drop 10-15% sequentially in fiscal Q4 2025 due to seasonal impacts, and consolidated Adjusted EBITDA is expected to be in the range of $130 million and $160 million.
The Chemours Company (NYSE:CC) provides performance chemicals, delivering solutions that include a range of chemical and industrial products for markets, such as plastics, semiconductors and consumer electronics, coatings, transportation, refrigeration and air conditioning, and general industrial. The company operates through the following segments: Titanium Technologies, Thermal and Specialized Solutions, Advanced Performance Materials, and Other.
While we acknowledge the potential of CC to grow, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and have limited downside risk. If you are looking for an AI stock that is more promising than CC and that has 100x upside potential, check out our report about this cheapest AI stock.
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