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.
The downside that can come from buying these securities is precisely why we started StockStory - to isolate the long-term winners from the losers so you can invest with confidence. That said, here are three small-cap stocks to swipe left on and some alternatives you should look into instead.
CONMED (CNMD)
Market Cap: $1.59 billion
With over five decades of experience in surgical innovation since its founding in 1970, CONMED (NYSE:CNMD) develops and manufactures medical devices and equipment for surgical procedures, specializing in orthopedic and general surgery products.
Why Does CNMD Worry Us?
- Subscale operations are evident in its revenue base of $1.33 billion, meaning it has fewer distribution channels than its larger rivals
- Low returns on capital reflect management’s struggle to allocate funds effectively
CONMED is trading at $51.42 per share, or 11.4x forward P/E. Dive into our free research report to see why there are better opportunities than CNMD.
Amphastar Pharmaceuticals (AMPH)
Market Cap: $1.28 billion
Founded in 1996 and known for its expertise in complex drug formulations, Amphastar Pharmaceuticals (NASDAQ:AMPH) develops and manufactures technically challenging injectable and inhalation medications, including both generic and proprietary pharmaceutical products.
Why Is AMPH Not Exciting?
- Subscale operations are evident in its revenue base of $722.7 million, meaning it has fewer distribution channels than its larger rivals
- Demand is forecasted to shrink as its estimated sales for the next 12 months are flat
Amphastar Pharmaceuticals’s stock price of $27.06 implies a valuation ratio of 8.4x forward P/E. If you’re considering AMPH for your portfolio, see our FREE research report to learn more.
LendingClub (LC)
Market Cap: $2.02 billion
Pioneering peer-to-peer lending in the US before evolving into a digital bank, LendingClub (NYSE:LC) operates a marketplace that connects borrowers with lenders, offering personal loans, auto refinancing, and banking services.
Why Are We Hesitant About LC?
- Customers postponed purchases of its products and services this cycle as its revenue declined by 8% annually over the last two years
- Earnings per share have dipped by 8.8% annually over the past two years, which is concerning because stock prices follow EPS over the long term
- Low return on equity reflects management’s struggle to allocate funds effectively
At $17.64 per share, LendingClub trades at 19x forward P/E. To fully understand why you should be careful with LC, check out our full research report (it’s free).
Stocks We Like More
Trump’s April 2025 tariff bombshell triggered a massive market selloff, but stocks have since staged an impressive recovery, leaving those who panic sold on the sidelines.
Take advantage of the rebound by checking out our Top 5 Strong Momentum Stocks for this week. This is a curated list of our High Quality stocks that have generated a market-beating return of 183% over the last five years (as of March 31st 2025).
Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,545% between March 2020 and March 2025) as well as under-the-radar businesses like the once-small-cap company Exlservice (+354% 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
StockStory is growing and hiring equity analyst and marketing roles. Are you a 0 to 1 builder passionate about the markets and AI? See the open roles here.