Small-Cap Stocks to Watch: Upwork is Growing Fast, But is It a Win?

Small-Cap Stocks

Small-cap stocks can offer lucrative opportunities for investors. “Small-cap” typically refers to any company under $2 billion USD in value. These companies (more-often-than-not) have lower buy-in share prices, which can mean volatility—so treading carefully is advised!

But there are sudden gains to be found in this sector, so let’s check out what’s on the radar today.

Small-Cap Stocks to Watch: Upwork

As our working climate evolves, more and more of us are working remotely, as free-lancers, or offering our services part-time to earn a little bit of extra cash.

The market for “side-jobbing” is huge, and this puts companies such as Upwork (NASDAQ:UPWK) in the right place at the very right time. Shares in the company are selling for $16.63 USD at present, and with a market cap of $1.78 billion, the company is growing fast.

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Freelancing and Upwork

According to estimates, “nearly 57 million workers in America now have some sort of freelancing job.” The numbers have never been this high, and this is why these small-cap stocks could shine.

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Upwork’s customer base of more than 111,000 clients offers freelance work across more than 70 categories. The overall goal is to place freelance professionals in jobs that offer competitive (if not higher rates) in longterm positions. In other words, it is legitimizing the freelancing industry by aiming to make careers for its users, as opposed to temporary jobs.

As the freelance working model grows, so does Upwork. The company’s service volume increased by 21% in the most recent quarter to $487 million. And further, according to analyst Chris Neiger:

“Its core clients grew 22% year over year, and its client spend retention rate — which measures how much existing clients are spending compared to the previous year — was up 107%.”

Share Performance

Since its IPO last October, these small-cap stocks have fallen 20%. There were highs of $22.72 reached in February; however, shares have been on a decline since.

But Upwork is growing in popularity, and the working economy in which it operates is becoming the norm. There could be a win here for those who don’t mind waiting out the current bearish trend.

Any other small-cap stocks on your radar? Let us know!

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