Our list today highlights the 10 Hottest SMID-Cap Stocks So Far In 2025.
SMID-caps, or Small- and mid-cap stocks, are often overlooked segments of the market. They are like those promising boxers training outside the ring while the heavyweight champions dominate the headlines. While many investors expect a rotation into SMID equities as large-cap valuations stretch to elevated levels, SMID stocks still lag their larger peers. Year-to-date, total returns for small caps (measured by the Russell 2500 Index) and mid-caps (measured by the S&P MidCap 400 Index) stand at approximately 3% and 1%, versus an over 12% return for the S&P 500 Index.
However, expectations for SMID-cap stocks remain constructive. In a November 12 CNBC interview, Scott Chronert, U.S. equity strategist at Citi, discussed why he favors small- and mid-cap equities. He noted that while the AI-related large-cap technology names have driven performance this year and should continue to contribute next year, investors are beginning to look further down the market-cap spectrum for incremental growth.
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Chronert pointed out that toward the end of the year, the market is increasingly focusing on 2026 earnings. He particularly highlighted that consensus forecasts call for small- and mid-cap companies to move from low-single-digit earnings growth this year to low-double-digit earnings growth in 2026. He connected this to developments during the third-quarter reporting season, where companies in this segment that exceeded expectations and raised guidance for the coming quarters outperformed even the S&P 500. This, as he sees it, suggests improving sentiment.
Chronert likes the SMID space partly because comparisons are easier after two years of earnings contraction. He also sees support from reduced policy uncertainty and potential additional rate cuts, as the smaller firms exhibit a greater economic sensitivity to such factors. Stable macro conditions and accommodative monetary policy could favor small- and mid-caps relative to large-caps.
Historically, some of the strongest rallies have begun when investors shift their focus beyond the market’s largest names and seek growth where expectations are still modest. Progress on the rate cut cycle should also be supportive. In a report published in mid-September 2025, Charlotte Daughtrey, Equity Investment Specialist, Federated Hermes Limited, highlighted:
“US SMID companies tend to outperform in environments where monetary policy is loosening. Historically, in the eight rate-cutting cycles since 1979, US small caps have outperformed their large-cap peers by an average of 6% in the 12 months following the first cut in rates – a powerful precedent for investors seeking cyclical upside.”
With that background, let’s explore the 10 hottest SMID-cap stocks so far in 2025.
Our Methodology
To identify the hottest SMID-cap stocks so far in 2025, we began by screening U.S.-based stocks with market capitalizations between $300 million and $10 billion and share prices above $5 to avoid penny stocks. From this pool, we selected stocks that have delivered year-to-date total returns exceeding 100%, are covered by more than five Wall Street analysts, and are held by at least 15 hedge funds, based on Insider Monkey’s Q2 2025 filings database. Finally, we shortlisted the top 10 stocks with the highest YTD returns and ranked them in ascending order of their respective returns. Additionally, we included data on hedge fund holdings in these companies to provide further insight into investor interest.
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).
Note: All pricing data is as of market close on November 20, 2025.
10 Hottest SMID-Cap Stocks So Far In 2025
10. Viasat Inc. (NASDAQ:VSAT)
Sector/Industry: Technology/Communication Equipment
YTD Total Returns: 257.9%
Market Cap: $4.1 Billion
Number of Hedge Fund Holders: 37
Viasat Inc. (NASDAQ:VSAT) is among the hottest SMID-cap stocks so far in 2025. On November 11, JPMorgan analyst Sebastiano Petti more than doubled his price target on Viasat Inc. (NASDAQ:VSAT) to $50 from $23 and upgraded his rating from Neutral to Overweight, according to TheFly.
Petti pointed to the company’s recent shareholder letter, which gave him more confidence in a potential strategic separation of ViaSat’s Defense and Advanced Technologies division. According to his latest research note, Viasat Inc. (NASDAQ:VSAT) appears to be actively exploring options to unlock shareholder value. However, the timing of such a move may be deferred by a few quarters as the company evaluates its options.
The analyst based his price target revision on a sum-of-the-parts valuation, which suggests that the individual components of ViaSat’s business may be worth more separately than as a whole. While Petti does not anticipate any immediate monetization of ViaSat’s spectrum assets, he believes they hold long-term value.
It should be noted that activist investor Carronade Capital Management had also suggested that Viasat Inc. (NASDAQ:VSAT) split its defence business in the first week of August this year, amid the company’s strategic review. In addition, the company announced its Q2 results the same week, and both pieces of news led to a 50% rally. Since then, the stock has risen 100%.
Overall, Viasat Inc. (NASDAQ:VSAT) stock is up an impressive 258% year to date (as of November 20), driven by strong results and further supported by deal announcements and joint ventures.
Viasat Inc. (NASDAQ:VSAT) is a global communications company that provides high-speed satellite broadband services and secure networking solutions. They serve commercial, government, and military customers worldwide, offering satellite internet, in-flight connectivity, and secure communication solutions.
9. Centrus Energy Corp. (NYSEAMERICAN:LEU)
Sector/Industry: Energy/Uranium
YTD Total Returns: 262.3%
Market Cap: $4.4 Billion
Number of Hedge Fund Holders: 27
Centrus Energy Corp. (NYSEAMERICAN:LEU) is among the hottest SMID-cap stocks so far in 2025. On November 10, Jeff Grampp, an analyst at Northland, maintained his bullish stance on the stocks, assigning an Outperform rating and raising his price target to $300 from $275, according to TheFly.
The company announced third-quarter results on November 5, but Grampp found them a non-event. However, he was somewhat disappointed, as he had expected more updates on the funding development for the domestic enrichment project. As per his analysis, the talks should have progressed in the third quarter.
Grampp also argued that the shutdown may have delayed the developments, and an announcement could come soon. He, therefore, remains bullish on the stock.
Centrus Energy Corp.’s (NYSEAMERICAN:LEU) stock has rallied by over 262% in 2025 (as of November 20), driven by several catalysts, the most significant of which was the Trump administration’s aggressive push to increase the country’s nuclear energy capacity, along with its support for domestic uranium mining and enrichment. When it reached its peak level in mid-October this year, the stock was up as much as 600%, but has since corrected by around 50% to settle at $241 as of November 20.
Centrus Energy Corp. (NYSEAMERICAN:LEU) boasts the American Centrifuge, the world’s most advanced gas centrifuge enrichment technology, which enables the enrichment of High-Assay, Low-Enriched Uranium (HALEU), the required fuel for most next-generation reactors. As of September 2025, the Company’s backlog stood at $3.9 billion, extending through 2040.
Centrus Energy Corp. (NYSEAMERICAN:LEU) is a supplier of nuclear fuel and services to the nuclear power industry. The company supports U.S. energy security through domestic enrichment capabilities and long-term supply agreements.
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