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Top 10 Small-Cap Stocks With Highest Upside Potential

In this article, we discuss the top 10 small-cap stocks with highest upside potential. If you want to read about some more small-cap stocks with upside potential, go directly to Top 5 Small-Cap Stocks With Highest Upside Potential.

Recession fears in the United States have been gathering pace over the past few months due to soaring inflation and rising interest rates. These concerns had been lent further credence by the Gross Domestic Product (GDP) shrinking 1.6% and 0.6% in the first two quarters of the year, respectively. However, economic experts are now excepting the US GDP to register a robust turnaround in the third quarter of 2022, comparable to pre-pandemic growth activity, just a few days before official numbers in this regard are released by the government. 

According to a tracker from the Federal Reserve Bank of Atlanta, the US GDP rose by close to 3% between July and September. This growth is backed by a narrowing trade gap, in part because the US is importing fewer goods as a result of slowing demand. In addition, inventory levels show stronger growth at retailers because of leaner supply chains. These predictions have boosted shares of smaller companies at the stock market as investor confidence in the economy improves after a torrid nine months. 

Some of the best small-cap stocks to buy to profit from an upcoming stock market boom include Griffon Corporation (NYSE:GFF), Sinclair Broadcast Group, Inc. (NASDAQ:SBGI), and CarParts.com, Inc. (NASDAQ:PRTS). However, even as a bull market beckons, there are some who warn that the reprieve will only be temporary. Joseph LaVorgna, the chief economist at SMBC Nikko Securities America, recently said in a note to clients, the economy frequently generates healthy gains in real GDP around the onset of recession. 

Our Methodology

The companies that have market capitalizations between $200 million and $2 billion and have upcoming growth catalysts were selected for the list. The analyst ratings of these firms and the latest updates related to them are also discussed to provide some additional context. Data from around 900 elite hedge funds tracked by Insider Monkey in the second quarter of 2022 was used to identify the number of hedge funds that hold stakes in each firm.

Photo by Mirza Babic on Unsplash

Top Small-Cap Stocks With Highest Upside Potential

10. Shenandoah Telecommunications Company (NASDAQ:SHEN)

Number of Hedge Fund Holders: 6 

Shenandoah Telecommunications Company (NASDAQ:SHEN) provides a range of broadband communication services and cell tower colocation space in the Mid-Atlantic region of the United States. It is one of the best small cap stocks to invest in. On September 29, Glo Fiber, powered by Shenandoah Telecommunications, announced that it has reached agreements with municipal officials to place next generation Fiber To the Home broadband services in Ashland and Hanover County.

Among the hedge funds being tracked by Insider Monkey, New York-based investment firm Renaissance Technologies is a leading shareholder in Shenandoah Telecommunications Company (NASDAQ:SHEN), with 689,094 shares worth more than $15.3 million. 

Just like Griffon Corporation (NYSE:GFF), Sinclair Broadcast Group, Inc. (NASDAQ:SBGI), and CarParts.com, Inc. (NASDAQ:PRTS), Shenandoah Telecommunications Company (NASDAQ:SHEN) is one of the best small cap stocks to buy now. 

9. ACM Research, Inc. (NASDAQ:ACMR)

Number of Hedge Fund Holders: 8  

ACM Research, Inc. (NASDAQ:ACMR) develops, manufactures, and sells single-wafer wet cleaning equipment for enhancing the manufacturing process and yield for integrated chips worldwide. It is one of the top small cap stocks to invest in. On September 27, ACM Research revealed that it has expanded the 300mm Ultra Fn furnace dry processing platform with the introduction of its Ultra Fn A furnace tool. The company also added that it has shipped the first Ultra Fn A furnace tool to a top tier China-based foundry manufacturer. 

At the end of the second quarter of 2022, 8 hedge funds in the database of Insider Monkey held stakes worth $133.4 million in ACM Research, Inc. (NASDAQ:ACMR), compared to 16 in the preceding quarter worth $185.6 million. 

In its Q2 2022 investor letter, Baron Funds, an asset management firm, highlighted a few stocks and ACM Research, Inc. (NASDAQ:ACMR) was one of them. Here is what the fund said:

“ACM Research, Inc. (NASDAQ:ACMR) is a semiconductor production equipment company with principal operations in China. In our view, ACM will be a key beneficiary of the rapid fab capacity expansion in China, gain domestic market share as fabs shift to local suppliers for self-sufficiency, and will expand overseas in the longer term.

We believe ACM will successfully expand its product portfolio beyond its industry-leading wafer cleaning tools. ACM’s differentiated technology, reflected in its attractive gross margin profile and orders from tier-1 chipmakers, represents an enduring competitive advantage, in our view. We expect the company to generate strong double-digit earnings growth over the next several years.”

8. OptimizeRx Corporation (NASDAQ:OPRX)

Number of Hedge Fund Holders: 9      

OptimizeRx Corporation (NASDAQ:OPRX) is a digital health technology company that provides various solutions to life sciences organizations, healthcare providers, and patients. It is one of the elite small cap stocks to invest in. On July 26, OptimizeRx Corp stated that it had partnered with Cooler Screens, a media and merchandising platform, to enhance the value agencies for its clients. The firm said that agency customers are consistently discovering new ways to engage the ecosystem of healthcare stakeholders.

On August 10, investment advisory RBC Capital maintained an Outperform rating on OptimizeRx Corporation (NASDAQ:OPRX) stock and lowered the price target to $22 from $50. Analyst Sean Dodge issued the ratings update. 

Among the hedge funds being tracked by Insider Monkey, New York-based investment firm G2 Investment Partners Management is a leading shareholder in OptimizeRx Corporation (NASDAQ:OPRX), with 536,851 shares worth more than $14.7 million.  

7. InvenTrust Properties Corp. (NYSE:IVT)

Number of Hedge Fund Holders: 10   

InvenTrust Properties Corp. (NYSE:IVT) is a premier multi-tenant retail REIT that owns, leases, redevelops, acquires, and manages grocery-anchored neighborhood centers, and select power centers that often have a grocery component, predominantly in Sun Belt markets with favorable demographics. It is one of the premier small cap stocks to invest in. On July 19, InvenTrust Properties declared that it has completed the sale of Centerplace of Greely, a shopping center in Greeley, Colorado. The shopping center covered an area of 152,000 square ft.

On September 29, Bank of America analyst Craig Schmidt initiated coverage of InvenTrust Properties Corp (NYSE:IVT) stock with a Neutral rating and a $26 price target, noting that the company’s focus on grocery-anchored assets was fast growing in the Sun Belt markets. 

Among the hedge funds being tracked by Insider Monkey, New York-based investment firm Third Avenue Management is a leading shareholder in InvenTrust Properties Corp. (NYSE:IVT), with 733,701 shares worth more than $18.9 million. 

In its Q4 2021 investor letter, Third Avenue Management, an asset management firm, highlighted a few stocks and InvenTrust Properties Corp. (NYSE:IVT) was one of them. Here is what the fund said:

“During the quarter, the Third Avenue Real Estate Value Fund entered into such a transaction by purchasing the common stock of InvenTrust Properties Corp. (NYSE:IVT) at prices below where the company had offered to repurchase shares via a tender offer. However, unlike traditional “risk arbitrageurs”, Fund Management’s intentions were to forego the buyback in anticipation of more value being recognized as the management team executed on its business plan for this recently listed business.

Founded in 2004, InvenTrust Properties Corp. (“InvenTrust”) historically operated as a privately-held Real Estate Investment Trust (“REIT”) that invested in a diverse set of commercial properties. However, the entity seemingly initiated a process to create liquidity for its investor base around 2015 when it internalized its management agreement with Inland Real Estate Group and subsequently spun-off its hotel assets (Xenia Corp.) and office properties (Highland REIT) into separate companies. The remaining shopping center portfolio served to form the InvenTrust platform, which was finally listed as a publicly traded REIT during the quarter.

At the time of the listing, InvenTrust controlled nearly 10 million square feet of predominantly grocery-anchored retail properties that were approximately 93% occupied and located in select Sunbelt markets including Austin, Miami, Raleigh, and Tampa. The company also had very modest debt levels allowing it to launch a “tender offer” to purchase up to 4.0 million shares to support the transition to the public markets…(read more)

6. Ranger Oil Corporation (NASDAQ:ROCC)

Number of Hedge Fund Holders: 12     

Ranger Oil Corporation (NASDAQ:ROCC), an independent oil and gas company, engages in the onshore exploration, development, and production of crude oil, natural gas liquids, and natural gas. It is one of the major small cap stocks to invest in. On September 28, Ranger Oil Corp announced an increase in its borrowing base under its revolving credit facility to $950 million. This is the third increase year-to-date with a total percentage of 60%. On July 7, Ranger Oil expanded its shareholder return program.

At the end of the second quarter of 2022, 12 hedge funds in the database of Insider Monkey held stakes worth $36 million in Ranger Oil Corporation (NASDAQ:ROCC), compared to 14 in the previous quarter worth $55.3 million.

In addition to Griffon Corporation (NYSE:GFF), Sinclair Broadcast Group, Inc. (NASDAQ:SBGI), and CarParts.com, Inc. (NASDAQ:PRTS), Ranger Oil Corporation (NASDAQ:ROCC) is one of the best small cap stocks to buy now according to elite investors. 

Click to continue reading and see Top 5 Small-Cap Stocks With Highest Upside Potential.

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Disclosure. None. Top 10 Small-Cap Stocks With Highest Upside Potential is originally published on Insider Monkey.

AI, Tariffs, Nuclear Power: One Undervalued Stock Connects ALL the Dots (Before It Explodes!)

Artificial intelligence is the greatest investment opportunity of our lifetime. The time to invest in groundbreaking AI is now, and this stock is a steal!

AI is eating the world—and the machines behind it are ravenous.

Each ChatGPT query, each model update, each robotic breakthrough consumes massive amounts of energy. In fact, AI is already pushing global power grids to the brink.

Wall Street is pouring hundreds of billions into artificial intelligence—training smarter chatbots, automating industries, and building the digital future. But there’s one urgent question few are asking:

Where will all of that energy come from?

AI is the most electricity-hungry technology ever invented. Each data center powering large language models like ChatGPT consumes as much energy as a small city. And it’s about to get worse.

Even Sam Altman, the founder of OpenAI, issued a stark warning:

“The future of AI depends on an energy breakthrough.”

Elon Musk was even more blunt:

“AI will run out of electricity by next year.”

As the world chases faster, smarter machines, a hidden crisis is emerging behind the scenes. Power grids are strained. Electricity prices are rising. Utilities are scrambling to expand capacity.

And that’s where the real opportunity lies…

One little-known company—almost entirely overlooked by most AI investors—could be the ultimate backdoor play. It’s not a chipmaker. It’s not a cloud platform. But it might be the most important AI stock in the US owns critical energy infrastructure assets positioned to feed the coming AI energy spike.

As demand from AI data centers explodes, this company is gearing up to profit from the most valuable commodity in the digital age: electricity.

The “Toll Booth” Operator of the AI Energy Boom

  • It owns critical nuclear energy infrastructure assets, positioning it at the heart of America’s next-generation power strategy.
  • It’s one of the only global companies capable of executing large-scale, complex EPC (engineering, procurement, and construction) projects across oil, gas, renewable fuels, and industrial infrastructure.
  • It plays a pivotal role in U.S. LNG exportation—a sector about to explode under President Trump’s renewed “America First” energy doctrine.

Trump has made it clear: Europe and U.S. allies must buy American LNG.

And our company sits in the toll booth—collecting fees on every drop exported.

But that’s not all…

As Trump’s proposed tariffs push American manufacturers to bring their operations back home, this company will be first in line to rebuild, retrofit, and reengineer those facilities.

AI. Energy. Tariffs. Onshoring. This One Company Ties It All Together.

While the world is distracted by flashy AI tickers, a few smart investors are quietly scooping up shares of the one company powering it all from behind the scenes.

AI needs energy. Energy needs infrastructure.

And infrastructure needs a builder with experience, scale, and execution.

This company has its finger in every pie—and Wall Street is just starting to notice.

Wall Street is noticing this company also because it is quietly riding all of these tailwinds—without the sky-high valuation.

While most energy and utility firms are buried under mountains of debt and coughing up hefty interest payments just to appease bondholders…

This company is completely debt-free.

In fact, it’s sitting on a war chest of cash—equal to nearly one-third of its entire market cap.

It also owns a huge equity stake in another red-hot AI play, giving investors indirect exposure to multiple AI growth engines without paying a premium.

And here’s what the smart money has started whispering…

The Hedge Fund Secret That’s Starting to Leak Out

This stock is so off-the-radar, so absurdly undervalued, that some of the most secretive hedge fund managers in the world have begun pitching it at closed-door investment summits.

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Why? Because excluding cash and investments, this company is trading at less than 7 times earnings.

And that’s for a business tied to:

  • The AI infrastructure supercycle
  • The onshoring boom driven by Trump-era tariffs
  • A surge in U.S. LNG exports
  • And a unique footprint in nuclear energy—the future of clean, reliable power

You simply won’t find another AI and energy stock this cheap… with this much upside.

This isn’t a hype stock. It’s not riding on hope.

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This is your chance to get in before the rockets take off!

Disruption is the New Name of the Game: Let’s face it, complacency breeds stagnation.

AI is the ultimate disruptor, and it’s shaking the foundations of traditional industries.

The companies that embrace AI will thrive, while the dinosaurs clinging to outdated methods will be left in the dust.

As an investor, you want to be on the side of the winners, and AI is the winning ticket.

The Talent Pool is Overflowing: The world’s brightest minds are flocking to AI.

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A New Dawn is Coming to U.S. Stocks

I work for one of the largest independent financial publishers in the world – representing over 1 million people in 148 countries.

We’re independently funding today’s broadcast to address something on the mind of every investor in America right now…

Should I put my money in Artificial Intelligence?

Here to answer that for us… and give away his No. 1 free AI recommendation… is 50-year Wall Street titan, Marc Chaikin.

Marc’s been a trader, stockbroker, and analyst. He was the head of the options department at a major brokerage firm and is a sought-after expert for CNBC, Fox Business, Barron’s, and Yahoo! Finance…

But what Marc’s most known for is his award-winning stock-rating system. Which determines whether a stock could shoot sky-high in the next three to six months… or come crashing down.

That’s why Marc’s work appears in every Bloomberg and Reuters terminal on the planet…

And is still used by hundreds of banks, hedge funds, and brokerages to track the billions of dollars flowing in and out of stocks each day.

He’s used this system to survive nine bear markets… create three new indices for the Nasdaq… and even predict the brutal bear market of 2022, 90 days in advance.

Click to continue reading…