Small-cap stocks can outperform large-cap stocks over time; there’s been plenty of proof in the pudding of that. For this reason, many investors choose to add these smaller-priced shares to their portfolio. But with hundreds out there, it can be hard to discern what plays will be the best to make.
Currently, small-cap stocks are lagging the S&P500, according to MarketRealist. So, does now actually offer a potential opportunity?
Here are some small-cap plays to consider.
Small-Cap Stocks to Watch: Fastly
Shares of cloud computing service provider Fastly (NYSE:FSLY) have been volatile in 2019. Only last week, they took a spill, dropping 23.8% after the company announced its fiscal Q2 2019 report. The results showed significant revenue gains, but also significant losses. Unfortunately, the latter drove stock action more than the former.
The problem is that the losses were bigger than expected: “$0.16 per share pro forma, and $0.26 per share as reported under generally accepted accounting principles.”
With this, shares are down at present, selling for $17.56 USD on the NYSE. But the lull might offer risk-averse investors an opportunity. Fastly remains a speculative play and warrants much more research, but with a market cap of $1.60 billion and a hugely lucrative climate for cloud computing, there’s potential in FSLY stock.
Small-Cap Stocks to Watch: Axos Financial
Based in San Diego, Axos Financial (NYSE:AX) is a bank holding company and the parent company of Axos Bank. With a market cap of $1.68 billion and shares selling for $28.09 at present, Axos Financial has brought investors on a crazy roller-coaster ride already in 2019.
New investors here should expect nothing less moving forward. The company has climbed from lows of roughly $25 to highs of $33—hitting every other figure several times in between across the last six months. But despite the volatility, AX stock still remains up 11% on the year. The volatility exposes these shares, and if the trend continues, then the potential for major spikes is high. These may offer investors a quick return on investment.
Recently, shares began to climb when the Board of Directors of Axos announced a new program to repurchase up to $100 million of its common stock. This is in addition to the existing share repurchase plan, which was approved on March 17, 2016. This plan has approximately $8 million shares remaining. It’s always a nice sign when a company begins to buy back its shares. Keep a close eye on this bank moving forward.
Any small-cap stocks on your radar?
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