5 Cheap Small-Cap Stocks to Buy Before the Next Breakout

In this article, we will take a look at the 5 cheap small-cap stocks to buy before the next breakout. If you want to see more stocks in this selection, go to the 10 Cheap Small-Cap Stocks to Buy Before the Next Breakout.

5. Clover Health Investments, Corp. (NASDAQ:CLOV)

Number of Hedge Fund Holders: 17

Share Price as of December 7: $1.31

Clover Health Investments, Corp. (NASDAQ:CLOV) is a Franklin, Tennessee-based healthcare insurance company established in 2014.

Clover Health Investments, Corp. (NASDAQ:CLOV) is a provider of Medicare Advantage insurance plans and works directly with the US government as a contractor through its proprietary platform. In an update issued to investors on November 8, Richard Close at Canaccord gave Clover Health Investments, Corp. (NASDAQ:CLOV) stock a target price of $4 and maintained a Buy rating on the stock. The analyst shared that the company’s Q3 2022 results outperformed his estimates and appreciated the increase in guidance for FY22. The analyst welcomed the higher focus of the entity to increase profit margins and make careful decisions to control its growth through mergers and acquisitions (M&A). Experts think Clover Health Investments, Corp.’s (NASDAQ:CLOV) has an intelligent growth plan in place, making it one of the best small-cap stocks to buy before the next breakout.

Renaissance Technologies increased its stake in Clover Health Investments, Corp. (NASDAQ:CLOV) by 145% during Q3 2022.

4. Workhorse Group Inc. (NASDAQ:WKHS)

Number of Hedge Fund Holders: 12

Share Price as of December 7: $2.30

Workhorse Group Inc. (NASDAQ:WKHS) is a Sharonville, Ohio-based company involved in designing and manufacturing electric vehicles, trucks, and drones. Furthermore, the company has a real-time telematics performance monitoring system based on the cloud platform. The system is focused on optimizing last-mile delivery.

In a research note issued on November 11, Christopher Souther at B. Riley assigned Workhorse Group Inc. (NASDAQ:WKHS) a target price of $5 and maintained a Buy rating on the stock. The company reiterated its top-line forecast for 2022 following an analysis of the testing issues faced by the C1000 vehicles. Furthermore, based on significant consumer demand, Workhorse Group Inc. (NASDAQ:WKHS) has also developed a new series of drones which is in the final flight testing phase. The company is in discussion with prospective clients about filing this item in both Europe and North America. Analysts think Workhorse Group Inc. (NASDAQ:WKHS) is one of the best small-cap stocks as the company has formed crucial commercial alliances that will allow it to expand significantly in the near future.

3. Innoviz Technologies Ltd. (NASDAQ:INVZ)

Number of Hedge Fund Holders: 17

Share Price as of December 7: $5.37

Innoviz Technologies Ltd. (NASDAQ:INVZ) is an Israeli company that is a manufacturer of solid-state light detection and ranging (LiDAR) sensors and perception software. The sensors and software play an important part in the evolution of the autonomous driving system.

Jared Maymon at Baird thinks that Innoviz Technologies Ltd. (NASDAQ:INVZ) is the top idea in the field of LiDAR and, at the current price, provides a very attractive entry position for potential investors. He added that it is challenging to find companies that offer a high reward profile with optimum risk. However, Innoviz Technologies manages to meet this criterion due to its high operational efficiency. Mr. Maymon added that the market is miscalculating the potential size and breadth of the offerings provided by Innoviz Technologies Ltd. (NASDAQ:INVZ). The analyst gave Innoviz Technologies Ltd. (NASDAQ:INVZ) stock a target price of $12, along with a Buy rating in a research note issued on November 16.

As of Q3 2022, Innoviz Technologies Ltd. (NASDAQ:INVZ) was held by 17 hedge funds.

2. Iovance Biotherapeutics, Inc. (NASDAQ:IOVA)

Number of Hedge Fund Holders: 39

Share Price as of December 7: $6.40

Iovance Biotherapeutics, Inc. (NASDAQ:IOVA) is a San Carlos, California-based biotech company founded in 2007 with a focus on developing tumor-infiltrating lymphocyte therapies against cancer. The company intends to use the power of the human immune system and create the first one-time cell therapy to treat solid tumor cancer.

Reni Benjamin at JMP Securities assigned Iovance Biotherapeutics, Inc. (NASDAQ:IOVA) stock a target price of $21 along with an Outperform rating in a note issued to investors on November 21. The analyst incorporated the impact of the delay in the filing of the Biologics License Application for lifileucel from Q4 2022 to Q1 2023. Benjamin concluded that Iovance Biotherapeutics, Inc. (NASDAQ:IOVA) is one of the best small-cap stocks as it offers a unique investment opportunity to potential investors due to the company’s strong cash position of $366.6 million and continuous progress in research to combat solid tumors. Iovance Biotherapeutics, Inc. (NASDAQ:IOVA) has taken its study to the next level by conducting combination research with checkpoint inhibitors.

1. Oatly Group AB (NASDAQ:OTLY)

Number of Hedge Fund Holders: 12

Share Price as of December 7: $1.63

Oatly Group AB (NASDAQ:OTLY) is a Malmö, Sweden-based food company that produces dairy products from oats.

In a note issued to investors on November 16, Nik Modi at RBC Capital gave Oatly Group AB (NASDAQ:OTLY) stock an Outperform rating with a target price of $7. The analyst appreciated the Oatly Group AB’s (NASDAQ:OTLY) efforts to shift its focus to a hybrid production model to improve the company’s financial health. During Q4 2022, Oatly Group AB’s (NASDAQ:OTLY) production facility came online in New Jersey. This is expected to increase the annual production run rate to 900 million liters as opposed to 496 million liters at the end of Q3 20222. Furthermore, the outstanding debt of the company stood at only $4.4 million as of Q3 2022, providing management the freedom to increase leverage to build up its operations. In Q3 2022, Oatly Group AB (NASDAQ:OTLY) observed a 16% YoY increase in sales and saw strong growth in demand across multiple categories.

As of Q3 2022, Oatly Group AB (NASDAQ:OTLY) was held by 12 hedge funds.

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