Two small-cap stocks on the radar today include SailPoint Technologies (NYSE:SAIL) and PetIQ (NASDAQ:PETQ). Let’s check out the potential here.
Small-Cap Stocks to Watch: SailPoint
At a current price of $20.93 USD, SailPoint Technologies could be an undervalued play. After the company reported a questionable Q1 report in May, SAIL stock fell nearly 30%. Investors were not too pleased with the company’s full-year guidance cut.
Shares have started to rally once again, but they still remain on the lower price of where they could be. The company’s Q2 release is due next month, and ahead of it, investors seem to be forgiving the company as shares are steadily climbing.
The company provides identity management software for businesses, and this is a space that is growing. And while it cut its guidance, even the lowered guidance shows a strong performance; SailPoint now predicts for revenue to increase about 12%.
Small-Cap Stocks to Watch: PetIQ
We love our pets, so much so that Americans, in particular, are spending more money on them every year. This reason alone makes PetIQ an enticing play.
The sector has shown real growth potential, and PETQ has begun to spurt; shares have already packed on 20% year-to-date.
The company has two paths that are seeing success: a growing network of veterinary offices that target the services market, and products under national brands that cover the retail side. Most recently, it acquired animal services business Perrigo (NYSE:PRGO) to boost the latter—paying out $185 million in the deal.
Since its IPO in 2017, it has not been plain sailing for this small-cap stock. PETQ has been hit with plenty of dips and gains. But overall, shares have grown 40% in two years, and that is something investors can’t complain about. According to InvestorPlace:
“On its own, market gains, the Perrigo acquisition, and share increases should allow the company to grow into a reasonable, if somewhat steep, ~30x forward P/E multiple.”
But keep in mind how strong a potential acquisition PetIQ also is. No matter what happens to this company, PETQ remains an attractive play in the animal sector right now. Shares are currently trading for $32.78 USD.
Do you have any small-cap stocks on your radar?
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