Small-cap stocks can be incredibly lucrative investments because their lack of analyst coverage leads to frequent mispricings. However, these businesses (and their stock prices) often stay small because their subscale operations make it harder to expand their competitive moats.
These trade-offs can cause headaches for even the most seasoned professionals, which is why we started StockStory - to help you separate the good companies from the bad. Keeping that in mind, here is one small-cap stock that could be the next 100 bagger and two that could be down big.
Two Small-Cap Stocks to Sell:
Opendoor (OPEN)
Market Cap: $5.56 billion
Founded by real estate guru Eric Wu, Opendoor (NASDAQ: OPEN) offers a technology-driven, convenient, and streamlined process to buy and sell homes.
Why Do We Pass on OPEN?
- Sluggish trends in its homes purchased suggest customers aren’t adopting its solutions as quickly as the company hoped
- Projected 45.4 percentage point decline in its free cash flow margin next year reflects the company’s plans to increase its investments to defend its market position
- Negative EBITDA restricts its access to capital and increases the probability of shareholder dilution if things turn unexpectedly
At $5.84 per share, Opendoor trades at 1x forward price-to-sales. If you’re considering OPEN for your portfolio, see our FREE research report to learn more.
Robert Half (RHI)
Market Cap: $2.72 billion
With roots dating back to 1948 as the first specialized recruiting firm for accounting and finance professionals, Robert Half (NYSE: RHI) provides specialized talent solutions and business consulting services, connecting skilled professionals with companies across various fields.
Why Should You Dump RHI?
- Sales tumbled by 9.4% annually over the last two years, showing market trends are working against its favor during this cycle
- Sales over the last five years were less profitable as its earnings per share fell by 11.6% annually while its revenue was flat
- Eroding returns on capital suggest its historical profit centers are aging
Robert Half’s stock price of $27.15 implies a valuation ratio of 19x forward P/E. Check out our free in-depth research report to learn more about why RHI doesn’t pass our bar.
One Small-Cap Stock to Watch:
Astrana Health (ASTH)
Market Cap: $1.24 billion
Formerly known as Apollo Medical Holdings until early 2024, Astrana Health (NASDAQ: ASTH) operates a technology-powered healthcare platform that enables physicians to deliver coordinated care while successfully participating in value-based payment models.
Why Are We Positive On ASTH?
- Impressive 47.7% annual revenue growth over the last two years indicates it’s winning market share this cycle
- Expected revenue growth of 34.2% for the next year suggests its market share will rise
- Earnings per share grew by 11.6% annually over the last five years and easily exceeded the peer group average
Astrana Health is trading at $24.64 per share, or 7.2x forward EV-to-EBITDA. Is now the time to initiate a position? See for yourself in our comprehensive research report, it’s free for active Edge members .
Stocks We Like Even More
The market’s up big this year - but there’s a catch. Just 4 stocks account for half the S&P 500’s entire gain. That kind of concentration makes investors nervous, and for good reason. While everyone piles into the same crowded names, smart investors are hunting quality where no one’s looking - and paying a fraction of the price. Check out the high-quality names we’ve flagged in our Top 5 Growth Stocks for this month. 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-micro-cap company Tecnoglass (+1,754% 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.
