2 Small-Cap Stocks on Our Watchlist and 1 We Brush Off

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.

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 two small-cap stocks that could be the next 100 baggers and one that could be down big.

One Small-Cap Stock to Sell:

Ryder (R)

Market Cap: $6.95 billion

As one of the first companies to introduce the idea of leasing trucks, Ryder (NYSE:R) provides rental vehicles to businesses and delivers packages directly to homes or businesses.

Why Is R Risky?

1. Sizable revenue base leads to growth challenges as its 3.5% annual revenue increases over the last two years fell short of other industrials companies
2. Falling earnings per share over the last two years has some investors worried as stock prices ultimately follow EPS over the long term
3. Free cash flow margin shrank by 5.8 percentage points over the last five years, suggesting the company is consuming more capital to stay competitive

Ryder is trading at $172.13 per share, or 12.3x forward P/E. Check out our free in-depth research report to learn more about why R doesn’t pass our bar.

Two Small-Cap Stocks to Watch:

Molina Healthcare (MOH)

Market Cap: $7.45 billion

Founded in 1980 as a provider for underserved communities in Southern California, Molina Healthcare (NYSE:MOH) provides managed healthcare services primarily to low-income individuals through Medicaid, Medicare, and Marketplace insurance programs across 21 states.

Why Do We Like MOH?

1. Annual revenue growth of 19.3% over the last five years was superb and indicates its market share increased during this cycle
2. Sizeable revenue base of $44.55 billion gives it economies of scale and favorable reimbursement terms with healthcare providers
3. Earnings per share grew by 5.8% annually over the last five years and slightly topped the peer group average

Molina Healthcare’s stock price of $144.70 implies a valuation ratio of 12.2x forward P/E. Is now the right time to buy? Find out in our full research report, it’s free for active Edge members.

Brink's (BCO)

Market Cap: $4.68 billion

Known for its iconic armored trucks that have been a fixture in American cities since 1859, Brink's (NYSE:BCO) provides secure transportation and management of cash and valuables for banks, retailers, and other businesses worldwide.

Why Are We Fans of BCO?

1. $5.15 billion in revenue allows it to spread its fixed costs across a wider base
2. Share repurchases have amplified shareholder returns as its annual earnings per share growth of 19.9% exceeded its revenue gains over the last five years
3. Improving returns on capital reflect management’s ability to monetize investments

At $112.76 per share, Brink's trades at 12.8x forward P/E. Is now the time to initiate a position? See for yourself in our in-depth research report, it’s free for active Edge members.

Stocks We Like Even More

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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