In this article, we will look at the 12 Best Small Cap Stocks to Buy for Long Term.
On June 9, Tom Lee of Fundstrat appeared on CNBC’s ‘Closing Bell’ to talk about what to think of the equity markets, the state of the chip stocks, and much more.
To him, the market is showing a lot of signs of jitters; the jitters in front of the SpaceX IPO, and just consolidating all these gains. We also know that there is a lot of future capital that is going to be raised by Google, Meta, OpenAI, and Anthropic. He thus believes that the market is trying to sort out all this in front of the Space IPO. Lee thinks this is healthy, though, and also does not think that this is going to derail the tech trade either.
READ ALSO: 12 Best NYSE Stocks to Buy for Long-Term Investment AND 10 Best Long Term Stocks to Buy Under $20.
Further talking about SpaceX’s $75 billion IPO, he stated that because of its index inclusion into the Nasdaq 100, a lot of institutional funds are now going to not only raise funds to buy the IPO but also to have cash available to actually position size. Lee also said that the good sign is that the memory stocks held above the Friday lows, and the same thing happened with semis. He therefore thinks that there are basically gut punches being seen there, but he does not believe that it means those charts are completely broken.
With these broader market trends in view, let’s look at the best small cap stocks to buy for the long term.
Our Methodology
We used the Finviz stock screener to identify the best small-cap stocks with a 5-year sales growth of over 30%. We then selected the top 12 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 15.
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).
12 Best Small Cap Stocks to Buy for Long Term
12. Nanobiotix S.A. (NASDAQ:NBTX)
Number of Hedge Fund Holders: 1
Nanobiotix S.A. (NASDAQ:NBTX) is one of the best small cap stocks to buy for the long term. Nanobiotix S.A. (NASDAQ:NBTX) announced on June 2 an update on operational progress and reported financial results for the first quarter of 2026. The company reported €42.1 million in cash and cash equivalents as of March 31, 2026, adding that it is expected to be sufficient to meet its working capital requirements for operations into 2029, which is consistent with the company’s currently contemplated cash burn rate.
It also reported the completion of a follow-on offering in May 2026 for aggregate gross proceeds of approximately €86.1 million, which includes issuance of pre-funded warrants to accelerate the development of Nanobiotix’s (NASDAQ:NBTX) other platforms. Furthermore, the company presented new data from Part 1 of the J&J-sponsored Phase 2 CONVERGE study at the 2026 annual European Society for Radiotherapy and Oncology, which was evaluating JNJ-1900 for patients with Stage 3 inoperable non-small cell lung cancer. Nanobiotix S.A. (NASDAQ:NBTX) also announced the FDA acceptance of a “protocol amendment to ongoing pivotal J&J sponsored NANORAY-312 study eliminating the previously planned interim analysis and modifying the final analysis to include fewer events and to be conducted sooner”.
Nanobiotix S.A. (NASDAQ:NBTX) is a late-stage biotechnology company that develops therapeutic approaches to treat cancer. The company’s technologies include NanoXray, which improves the efficacy of radiation therapy against tumor cells.
11. Agilon Health, Inc. (NYSE:AGL)
Number of Hedge Fund Holders: 8
Agilon Health, Inc. (NYSE:AGL) is one of the best small cap stocks to buy for the long term. Barclays upgraded Agilon Health, Inc. (NYSE:AGL) to Equal Weight from Underweight on May 26, setting a price target of $81 for the stock. The firm believes that the outlook for value-based care has “materially improved in recent weeks, driven by encouraging signs” of stabilizing cost trends and a more favorable 2027 Medicare Advantage rate outcome. It further told investors in a research note that the company’s fiscal Q1 report “significantly de-risks” forward estimates.
Agilon Health, Inc. (NYSE:AGL) also received a rating update from Benchmark on May 21, with the firm lifting the price target on the stock to $95 from $13 and reiterating a Buy rating on the shares. It stated that after a “remarkable” year-to-date performance, the firm thinks the current valuation “may restrain additional near-term performance”. However, Benchmark also believes that the company is in “the very early days of dramatic margin expansion with the potential for accelerating growth and longer-term stock performance.”
Agilon Health, Inc. (NYSE:AGL) provides healthcare services and is also involved in the provision of capital, payor relationships, data, executive experience, and contract support that allow physician groups to take on the risk of total care for their patients.
10. Capital Southwest Corporation (NASDAQ:CSWC)
Number of Hedge Fund Holders: 11
Capital Southwest Corporation (NASDAQ:CSWC) is one of the best small cap stocks to buy for the long term. B. Riley lifted the price target on Capital Southwest Corporation (NASDAQ:CSWC) to $24.50 from $24 on May 15 and maintained a Buy rating on the shares. The rating update came after the company reported its fiscal Q4 and full-year 2026 financial highlights, reporting a total investment portfolio of $2.1 billion for the quarter. The company’s credit portfolio was $1.9 billion, with current non-accruals with a fair value of $22.7 million, representing 1.1% of the total investment portfolio. Its balance sheet for the quarter represented cash and cash equivalents of $29.0 million, total net assets worth $1,011.0 million, and a net asset value per share of $16.69.
In its financial highlights for fiscal year 2026, Capital Southwest Corporation (NASDAQ:CSWC) reported that its total investment portfolio increased by $312.1 million in total fair value, from $1.8 billion to $2.1 billion, representing 17% growth during the year.
Capital Southwest Corporation (NASDAQ:CSWC) is an investment company that provides financing to middle-market companies.
9. Astrana Health, Inc. (NASDAQ:ASTH)
Number of Hedge Fund Holders: 15
Astrana Health, Inc. (NASDAQ:ASTH) is one of the best small cap stocks to buy for the long term. Astrana Health, Inc. (NASDAQ:ASTH) got upgraded to Overweight from Equal Weight by Barclays on May 26, with the firm lifting the price target on the stock to $50 from $37. It told investors in a research note that it believes the outlook for value-based care has “materially improved in recent weeks, driven by encouraging signs” of stabilizing cost trends and a more favorable 2027 Medicare Advantage rate outcome. It added that the company has room for multiple expansions as it executes on its integration of Prospect and accelerates full-risk membership growth.
For additional reference, in its financial results for fiscal Q1 2026 released on May 7, Astrana Health, Inc. (NASDAQ:ASTH) reported total revenue of $965.1 million, reflecting a 56% year over year growth. It also reported adjusted EBITDA of $66.3 million, up 82% year over year, and free cash flow of $64.1 million, up 372% year over year.
Astrana Health, Inc. (NASDAQ:ASTH) is a physician-centric, technology-powered, risk-bearing healthcare management company that operates as an integrated healthcare delivery platform. It provides services including Multi-Specialty Care, Primary Care, Radiology, Immediate Care, and Laboratory.
8. BlackSky Technology Inc. (NYSE:BKSY)
Number of Hedge Fund Holders: 17
BlackSky Technology Inc. (NYSE:BKSY) is one of the best small cap stocks to buy for the long term. Jefferies downgraded BlackSky Technology Inc. (NYSE:BKSY) to Hold from Buy on June 1, setting a price target of $50 with shares up 159% year-to-date. The firm stated that although the general excitement around space has driven the stock price move, Jefferies thinks of the event as unrelated to the company’s core market and sees limited upside from here.
In a separate development, BlackSky Technology Inc. (NYSE:BKSY) announced on May 28 that it was awarded a seven-figure, multi-year contract renewal to accelerate the automation of future non-Earth imagery services. Management stated that the follow-on agreement expands the program’s scope towards exploring next-generation imaging payload and specialized mission-planning software solutions supporting the real-time speed, reliability, and scale of space domain awareness (SDA) operations.
BlackSky Technology Inc. (NYSE:BKSY) further stated that as part of the contract, it will deliver timely, very high-resolution imagery and AI-enabled analytics of on-orbit objects that offer decision-makers a dual-use capability in a single platform.
BlackSky Technology Inc. (NYSE:BKSY) is a space-based intelligence company that delivers real-time imagery, analytics, and high-frequency monitoring of the most critical and strategic locations, economic assets, and events. The company also provides imagery and related data analytic products and services, geospatial intelligence, and mission systems that include the integration, development, and operation of satellite and ground systems to government and commercial customers.
7. Americas Gold and Silver Corporation (NYSEAMERICAN:USAS)
Number of Hedge Fund Holders: 18
Americas Gold and Silver Corporation (NYSEAMERICAN:USAS) is one of the best small cap stocks to buy for the long term. Americas Gold and Silver Corporation (NYSEAMERICAN:USAS) announced on June 1 high-grade drill results from its ongoing resource conversion drilling program at the Cosalá Complex. The company stated that drilling was conducted in fiscal Q4 2025 through fiscal Q1 2026 at the San Rafael Upper, 120 Upper, and 120 Lower zones, with drilling at all three zones returning considerably higher silver grades than the currently modeled resource.
It further stated that the results represented notable upside potential to the future mine plan as they were reported after October 31, 2025, which is the Mineral Resource cutoff date, and thus were not included in Americas Gold and Silver Corporation’s (NYSEAMERICAN:USAS) recently announced Mineral Resource and Reserve statement.
Paul Andre Huet, Chairman and CEO, stated that the “highlight intercept in hole SR568 intersected 14.0 meters grading 599.8 g/t Ag in a section of the Mineral Resource that predicted silver grades of 110 g/t, representing more than 5x potential upgrade to the grades in that area when compared to our current Mineral Resource”.
Americas Gold and Silver Corporation (NYSEAMERICAN:USAS) is involved in the exploration, acquisition, and development of mineral resource properties. The company’s operations are divided into the following segments: Cosalá Operations, Galena Complex, Relief Canyon, and Corporate and Other. The Cosalá Operations segment operates in Mexico, while the Galena Complex and Relief Canyon segments focus on the United States.
6. Lucid Group, Inc. (NASDAQ:LCID)
Number of Hedge Fund Holders: 23
Lucid Group, Inc. (NASDAQ:LCID) is one of the best small cap stocks to buy for the long term. Lucid Group, Inc. (NASDAQ:LCID) received several rating updates following the release of its financial results for fiscal Q1. Benchmark downgraded Lucid Group, Inc. (NASDAQ:LCID) to Hold from Buy on May 7, without setting a price target on the stock. The firm told investors that factors such as mixed demand signals, weaker-than-expected deliveries, and the suspension of 2026 guidance following a CEO transition materially clouded visibility. Benchmark further stated that it believes the risk/reward “has skewed”.
Lucid Group, Inc. (NASDAQ:LCID) also received a rating update from Citi on May 15. The firm cut the price target on the stock to $14 from $17 and maintained a Buy rating on the shares. It told investors in a research note that Lucid Group, Inc. (NASDAQ:LCID) reported a fiscal Q1 miss and pulled its 2026 outlook. However, Citi believes that the company’s medium-term plans are intact, and it sees inflection points into 2027 with production starting at the new Saudi production plant and a decline in capital spending.
Lucid Group, Inc. (NASDAQ:LCID) is a manufacturer of electric vehicles and is involved in the designing, development, and building of energy storage systems for electric vehicles and supplies automakers with the battery pack system needed to power hybrid, plug-in, and electric vehicles.
While we acknowledge the potential of LCID 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 LCID and that has 100x upside potential, check out our report about the cheapest AI stock.
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