Investors looking for hidden gems should keep an eye on small-cap stocks because they’re frequently overlooked by Wall Street. Many opportunities exist in this part of the market, but it is also a high-risk, high-reward environment due to the lack of reliable analyst price targets.
Luckily for you, our mission at StockStory is to help you make money and avoid losses by sorting the winners from the losers. Keeping that in mind, here is one small-cap stock that could amplify your portfolio’s returns and two that may have trouble.
Two Small-Cap Stocks to Sell:
GameStop (GME)
Market Cap: $9.18 billion
Drawing gaming fans with demo units set up with the latest releases, GameStop (NYSE: GME) sells new and used video games, consoles, and accessories, as well as pop culture merchandise.
Why Are We Out on GME?
- GameStop’s brick-and-mortar engine keeps stalling as gamers migrate to digital downloads, and management is closing more outlets after shuttering hundreds of stores last year
- The share price remains an unpredictable meme-stock roller-coaster, and the purchase of thousands of Bitcoins have fueled huge swings
- On the bright side, the company has a large cash pile that gives CEO Ryan Cohen room to buy more Bitcoin or fund its collectibles and trading-card push
At $21.15 per share, GameStop trades at 23.6x forward P/E. Read our free research report to see why you should think twice about including GME in your portfolio.
Republic Bancorp (RBCAA)
Market Cap: $1.31 billion
With roots dating back to 1974 and operating across multiple states including Kentucky, Indiana, Florida, Ohio, and Tennessee, Republic Bancorp (NASDAQGS:RBCA.A) is a Kentucky-based financial holding company that operates a bank offering traditional banking, mortgage services, and specialized financial products.
Why Are We Cautious About RBCAA?
- Muted 9.5% annual net interest income growth over the last five years shows its demand lagged behind its banking peers
- Estimated net interest income decline of 1.7% for the next 12 months implies a challenging demand environment
- Estimated tangible book value per share growth of 7.5% for the next 12 months implies profitability will slow from its two-year trend
Republic Bancorp is trading at $68.95 per share, or 1.2x forward P/B. Check out our free in-depth research report to learn more about why RBCAA doesn’t pass our bar.
One Small-Cap Stock to Watch:
Match Group (MTCH)
Market Cap: $7.68 billion
Originally started as a dial-up service before widespread internet adoption, Match (NASDAQ: MTCH) was an early innovator in online dating and today has a portfolio of apps including Tinder, Hinge, Archer, and OkCupid.
Why Are We Fans of MTCH?
- Customer spending is rising as the company has focused on monetization over the last two years, leading to 7.9% annual growth in its average revenue per user
- Excellent EBITDA margin of 35.7% highlights the efficiency of its business model
- Robust free cash flow margin of 26.7% gives it many options for capital deployment, and its rising cash conversion increases its margin of safety
Match Group’s stock price of $33.15 implies a valuation ratio of 6.3x forward EV/EBITDA. Is now the time to initiate a position? See for yourself in our in-depth research report, it’s free for active Edge members.
High-Quality Stocks for All Market Conditions
Your portfolio can’t afford to be based on yesterday’s story. The risk in a handful of heavily crowded stocks is rising daily.
The names generating the next wave of massive growth are right here in our Top 9 Market-Beating Stocks. This is a curated list of our High Quality stocks that have generated a market-beating return of 244% over the last five years (as of June 30, 2025).
Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,326% between June 2020 and June 2025) as well as under-the-radar businesses like the once-small-cap company Comfort Systems (+782% five-year return). Find your next big winner with StockStory today for free. Find your next big winner with StockStory today. Find your next big winner with StockStory today
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