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.
Luckily for you, our mission at StockStory is to help you make money and avoid losses by sorting the winners from the losers. Keeping that in mind, here are three small-cap stocks to swipe left on and some alternatives you should look into instead.
Nature's Sunshine (NATR)
Market Cap: $291.7 million
Started on a kitchen table in Utah, Nature’s Sunshine (NASDAQ: NATR) manufactures and sells nutritional and personal care products.
Why Are We Cautious About NATR?
- Sales stagnated over the last three years and signal the need for new growth strategies
- Subscale operations are evident in its revenue base of $460.8 million, meaning it has fewer distribution channels than its larger rivals
- Demand will likely be soft over the next 12 months as Wall Street’s estimates imply tepid growth of 1.3%
At $16.54 per share, Nature's Sunshine trades at 20.9x forward P/E. Read our free research report to see why you should think twice about including NATR in your portfolio.
REV Group (REVG)
Market Cap: $2.55 billion
Offering the first full-electric North American fire truck, REV (NYSE: REVG) manufactures and sells specialty vehicles.
Why Is REVG Not Exciting?
- Flat sales over the last five years suggest it must find different ways to grow during this cycle
- Gross margin of 12% is below its competitors, leaving less money to invest in areas like marketing and R&D
- Poor expense management has led to an operating margin of 3% that is below the industry average
REV Group is trading at $52.31 per share, or 18.7x forward P/E. Dive into our free research report to see why there are better opportunities than REVG.
GoodRx (GDRX)
Market Cap: $1.30 billion
Started in 2011 to tackle the problem of high prescription drug costs in America, GoodRx (NASDAQ: GDRX) operates a digital platform that helps consumers find lower prices on prescription medications through price comparison tools and discount codes.
Why Do We Avoid GDRX?
- Customer additions have disappointed over the past two years, indicating the company’s value proposition may not be resonating
- Smaller revenue base of $799.9 million means it hasn’t achieved the economies of scale that some industry juggernauts enjoy
- Push for growth has led to negative returns on capital, signaling value destruction
GoodRx’s stock price of $3.75 implies a valuation ratio of 8.9x forward P/E. If you’re considering GDRX for your portfolio, see our FREE research report to learn more.
Stocks We Like More
Trump’s April 2025 tariff bombshell triggered a massive market selloff, but stocks have since staged an impressive recovery, leaving those who panic sold on the sidelines.
Take advantage of the rebound by checking out our Top 6 Stocks for this week. This is a curated list of our High Quality stocks that have generated a market-beating return of 183% over the last five years (as of March 31st 2025).
Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,545% between March 2020 and March 2025) as well as under-the-radar businesses like the once-small-cap company Exlservice (+354% 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
StockStory is growing and hiring equity analyst and marketing roles. Are you a 0 to 1 builder passionate about the markets and AI? See the open roles here.
