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Small Caps Begin to Rebound: 10 Stocks to Buy Now

·12 分鐘文章

In this article, we discuss 10 rebounding small cap stocks to buy now. If you want to see the top stocks in this category, check out 5 Rebounding Small-Cap Stocks to Buy Now

Carter Worth, the CEO of Worth Charting, joined CNBC’s ‘The Exchange’ on August 10 to review the energy sector and the recent outperformance of small-cap stocks over large-caps. Carter Worth said that he has recently stopped shorting energy stocks, which was one of his popular strategies, since the sector is so loved and almost ‘overbought’. However, energy has underperformed the S&P 500 index by 1400 basis points in the last 2.5 months. This makes him believe that being short energy over the S&P 500 is an “opportunity that has come and gone”. 

Another interesting inflection point in the stock market right now, according to Worth, is the performance of small-caps versus large-caps. Small-cap stocks have underperformed for almost a year, but have now begun to outperform the S&P 500 index. According to Carter Worth, small-cap stocks make for a better trade on a week-over-week basis. He also believes that the 14% market rally is not here to stay, and is rather a countertrend amid the downturn the economy has taken. He sees the rally in tech stocks as the reciprocal of beaten-down energy and materials stocks, which puts the market at an equilibrium. He is largely in favor of healthcare stocks, as they have cyclicality as well as defensive and offensive characteristics.

On August 10, small-caps had a banner trading day, with the Russell 2000 gaining 2.7%, compared to the S&P 500 and Nasdaq Composite, which climbed 1.8% and 2.5%, respectively. While investors usually gravitate towards mega-cap plays such as Alphabet Inc. (NASDAQ:GOOG), Amazon.com, Inc. (NASDAQ:AMZN), and Apple Inc. (NASDAQ:AAPL), it is prudent to have a balanced stock portfolio, which can benefit from the gains of rebounding small-caps as well. 

Small Caps Begin to Rebound: 10 Stocks to Buy Now
Small Caps Begin to Rebound: 10 Stocks to Buy Now

Photo by Austin Distel on Unsplash

Our Methodology 

We selected small-cap stocks that have reported notable share price gains in the last month as of August 11. These companies display optimistic growth catalysts and have been awarded positive analyst comments and ratings in the last few weeks. We have also mentioned the hedge fund sentiment around the securities as of Q1 2022. 

The list is ranked according to the 1-month share price gains, from smallest to largest. 

Small Caps Begin to Rebound: Stocks to Buy Now

10. Gulfport Energy Corporation (NYSE:GPOR)

Number of Hedge Fund Holders: 30

 

Market Capitalization as of August 11: $1.713 billion 

 

1-month Share Price Gain as of August 11: 10.53%

Gulfport Energy Corporation (NYSE:GPOR) is an Oklahoma-based company that is focused on the exploration and production of natural gas, crude oil, and natural gas liquids in the United States. On August 2, Gulfport Energy Corporation (NYSE:GPOR) reported earnings for the second quarter of 2022, posting normalized earnings per share of $5.09 and GAAP earnings per share of $10.34, beating the Wall Street consensus by $0.56 and $5.81, respectively. The company's revenue of $465.33 million also outperformed market estimates by $143.33 million. The company disclosed $80.3 million of free cash flow in the second quarter, and it had repurchased 2.2 million common shares worth $189.3 million as of July 28, 2022. Gulfport Energy Corporation (NYSE:GPOR) also boosted its share repurchase program from $200 million to $300 million.

On July 19, Truist analyst Neal Dingmann raised the price target on Gulfport Energy Corporation (NYSE:GPOR) to $135 from $120 and maintained a 'Buy' rating on the shares. The latest downturn in commodities has impacted the sector, but the tailwind "breeze remains brisk" as oil prices are presently at levels not witnessed since 2014 and up roughly 40% year-to-date, even though many oil stocks are almost flat or down, the analyst told investors. Gas E&Ps have performed better but it is not enough considering the 106% return of the commodity, the analyst contended.

According to Insider Monkey’s data, 30 hedge funds were bullish on Gulfport Energy Corporation (NYSE:GPOR) at the end of Q1 2022, with collective stakes worth $1.03 billion, up from 20 funds the prior quarter worth $796.6 million. Edward A. Mule’s Silver Point Capital is the leading position holder in the company, with 8.60 million shares worth $772.6 million. 

In addition to Alphabet Inc. (NASDAQ:GOOG), Amazon.com, Inc. (NASDAQ:AMZN), and Apple Inc. (NASDAQ:AAPL), elite hedge funds are monitoring Gulfport Energy Corporation (NYSE:GPOR) as a potential investment. 

Here is what Greenlight Capital had to say about Gulfport Energy Corporation (NYSE:GPOR) in its Q2 2021 investor letter:

“Thermal Coal and Natural Gas

ESG investing is inflationary, as green energy is simply more expensive than hydrocarbons. Hydrocarbon energy companies are starved for capital and are being told to change their ways. The result is less exploration and drilling. Even with benchmark oil prices surging over the last year, companies are loath to drill more. Normally, the cure for high prices is high prices. With ESG in the proverbial driver’s seat, we might need much higher prices still

in order to increase investment to meet demand.

There is almost nothing less popular than thermal coal. From 2011 to 2020, U.S. coal production declined by 51%. U.S. demand has fallen as we’ve shifted to alternative sources of electricity. As unpopular as coal is though, it still makes up about 20% of U.S. electricity generation. Globally, coal demand is growing modestly as China and India add power generation capacity faster than the West is reducing it. Even so, reduced oil and gas drilling has caused natural gas prices to advance and coal prices are following. Seaborne thermal coal prices are up 140% year-over-year and at the highest levels since 2011, and Northern Appalachia thermal coal prices are catching up, rising 23% in the last month alone.

We also own Gulfport Energy (GPOR), an Appalachian natural gas driller that recently emerged from bankruptcy and is poised to benefit from higher natural gas prices. Currently, there are no analyst estimates for GPOR.”

9. Akoya Biosciences, Inc. (NASDAQ:AKYA)

Number of Hedge Fund Holders: 5

 

Market Capitalization as of August 11: $581.511 million

 

1-month Share Price Gain as of August 11: 16.13%

Akoya Biosciences, Inc. (NASDAQ:AKYA) was incorporated in 2015 and is headquartered in Marlborough, Massachusetts. It operates as a life sciences technology company, offering spatial biology solutions that support transformational discovery and clinical research in North America, the Asia Pacific, Europe, the Middle East, and Africa. The company reported Q2 revenue of $17.9 million, up 37.0% year-over-year, topping market estimates by $0.97 million. In light of its updated plans and new initiatives, Akoya Biosciences, Inc. (NASDAQ:AKYA) lifted its full-year 2022 revenue guidance range to $71 million - $74 million, versus a $71.69 million consensus.

On June 22, BTIG analyst Mark Massaro initiated coverage of Akoya Biosciences, Inc. (NASDAQ:AKYA) with a 'Buy' rating and $16 price target. Akoya Biosciences, Inc. (NASDAQ:AKYA) is a "rapidly growing" life sciences technology company and its products assist scientists with detecting and mapping the disease progression and a patient's response to therapy. He said Akoya Biosciences, Inc. (NASDAQ:AKYA) "leverages a first mover advantage in an underpenetrated market". 

According to Insider Monkey’s data, 5 hedge funds were long Akoya Biosciences, Inc. (NASDAQ:AKYA) at the conclusion of March 2022, compared to 7 funds in the previous quarter. Douglas Braunstein and James Woolery’s Hudson Executive Capital is the leading stakeholder of the company, with 2.4 million shares worth about $27 million. 

8. Geron Corporation (NASDAQ:GERN)

Number of Hedge Fund Holders: 11

 

Market Capitalization as of August 11: $790.751 million

 

1-month Share Price Gain as of August 11: 18.64%

Geron Corporation (NASDAQ:GERN) is a California-based late-stage clinical biopharmaceutical company that specializes in the development and commercialization of therapeutics for myeloid hematologic malignancies. The company is working on its lead drug candidate in two primary indications, and its initial marketing application will likely be filed in the first half of 2023. Geron Corporation (NASDAQ:GERN) stock has gained 18.64% in the last month and is one of the top rebounding small-caps to buy now. 

Riley analyst Kalpit Patel initiated coverage of Geron Corporation (NASDAQ:GERN) on July 28 with a 'Buy' rating and $4 price target. The analyst's investment thesis relies on the likely success of Geron Corporation (NASDAQ:GERN)’s lead asset, imetelstat, for the treatment of lower-risk myelodysplastic syndrome and myelofibrosis. While the stock is notably outperforming the large biotech index this year, further upside is expected in the future due to the timing of a primary catalyst in January 2023, the analyst told investors in a research note.

According to Insider Monkey’s data, 11 hedge funds were bullish on Geron Corporation (NASDAQ:GERN) at the conclusion of the first quarter of 2022, with combined stakes worth $87 million, up from 6 funds in the prior quarter with positions worth $38.4 million. Peter Kolchinsky’s RA Capital Management is the largest stakeholder of the company, with more than 30 million shares worth about $41 million. 

7. Landec Corporation (NASDAQ:LNDC)

Number of Hedge Fund Holders: 15

 

Market Capitalization as of August 11: $345.387 million 

 

1-month Share Price Gain as of August 11: 18.76%

Landec Corporation (NASDAQ:LNDC) is headquartered in Santa Maria, California, where the company designs, develops, and sells differentiated health and wellness products to the food and biomaterials markets. On August 11, Barrington analyst Michael Petusky upgraded Landec Corporation (NASDAQ:LNDC) to 'Outperform' from 'Market Perform' with a $14 price target after the company posted a "solid fourth quarter" and announced that James Hall was the new CEO of the company, which will soon be rebranded as Lifecore Biomedical. James Hall has been heading Lifecore "quite successfully for several years," observed the analyst, adding that there is "no doubt in our minds that the decision Landec has made to focus on the Lifecore CDMO and to divest the remaining Curation assets as soon as possible (within reason) will be well-received by investors". The stock has rebounded about 19% in the last month as of August 11. 

According to the database of Insider Monkey, 15 hedge funds were bullish on Landec Corporation (NASDAQ:LNDC) at the end of March 2022, compared to 14 funds in the earlier quarter. Nelson Obus’ Wynnefield Capital is the biggest position holder in the company, with 3.5 million shares worth $41 million. 

6. Accolade, Inc. (NASDAQ:ACCD)

Number of Hedge Fund Holders: 22

 

Market Capitalization as of August 11: $872.671 million

 

1-month Share Price Gain as of August 11: 23.40%

Accolade, Inc. (NASDAQ:ACCD) is a Pennsylvania-based company that offers an on-demand technology platform to utilize the healthcare system and their workplace benefits in the United States. The company also provides support from health assistants and clinicians, such as nurses, doctors, and behavioral health specialists. Accolade, Inc. (NASDAQ:ACCD) stock has gained 23.40% in the last month as of August 11. The company reported a strong first quarter of its FY23, boosting revenue 44% year-over-year.

On July 1, Canaccord analyst Richard Close reaffirmed a 'Buy' rating on Accolade, Inc. (NASDAQ:ACCD) but lowered the price target on the shares to $12 from $17. The analyst expects Accolade, Inc. (NASDAQ:ACCD) to continue its track record of outperforming conservative estimates. He contended that with a robust cash position, core focus on profitability, and management's improving track record of competent execution, he sees the notable share pullback and discounted valuation as an excellent opportunity for positive returns for investors.

Among the hedge funds tracked by Insider Monkey, 22 funds were long Accolade, Inc. (NASDAQ:ACCD) at the end of Q1 2022, compared to 25 funds in the prior quarter. Cathie Wood’s ARK Investment Management is the largest stakeholder of the company, with 4.85 million shares worth over $85 million. 

Like Alphabet Inc. (NASDAQ:GOOG), Amazon.com, Inc. (NASDAQ:AMZN), and Apple Inc. (NASDAQ:AAPL), smart investors are paying attention to Accolade, Inc. (NASDAQ:ACCD) as it racks up gains on the stock market. 

Here is what Baron Discovery Fund had to say about Accolade, Inc. (NASDAQ:ACCD) in its Q4 2021 investor letter:

“Accolade, Inc. is a leader in providing purpose-built, technology-enabled virtual health care and personalized engagement services. Its products are designed to help employees access care and navigate/maximize their benefits with the goals of reduced health care costs and better outcomes. Shares dropped in the fourth quarter, alongside those of other high-multiple, tech-enabled, not yet profitable healthcare companies as investors became more focused on the path to profitability versus pure revenue growth and revisited valuations given the outlook for higher interest rates. Investors also grew more sensitive to perceived competition, as the healthcare IT space continues to attract significant venture capital. We continue to have a positive long-term view on this high-quality, well-managed company. We believe that Accolade has a truly differentiated offering, which is well aligned with the industry’s movement towards value-based care, and which delivers a measurable return on investment to clients. The 2021 acquisitions of 2ndMD and Plushcare, second opinion and virtual primary care providers, respectively, significantly broadened Accolades’ value proposition and should allow for meaningful cross-selling and higher-margin opportunities in 2022 and beyond. We added to our position in Accolade as we believe that shares have been oversold due to macroeconomic reasons rather than fundamental value reasons.”

 

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Disclosure: None. Small Caps Begin to Rebound: 10 Stocks to Buy Now is originally published on Insider Monkey.