Laser Focus World is an industry bedrock—first published in 1965 and still going strong. We publish original articles about cutting-edge advances in lasers, optics, photonics, sensors, and quantum technologies, as well as test and measurement, and the shift currently underway to usher in the photonic integrated circuits, optical interconnects, and copackaged electronics and photonics to deliver the speed and efficiency essential for data centers of the future.

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Editorial Advisory Board

  • Professor Andrea M. Armani, University of Southern California
  • Ruti Ben-Shlomi, Ph.D., LightSolver
  • James Butler, Ph.D., Hamamatsu
  • Natalie Fardian-Melamed, Ph.D., Columbia University
  • Justin Sigley, Ph.D., AmeriCOM
  • Professor Birgit Stiller, Max Planck Institute for the Science of Light, and Leibniz University of Hannover
  • Professor Stephen Sweeney, University of Glasgow
  • Mohan Wang, Ph.D., University of Oxford
  • Professor Xuchen Wang, Harbin Engineering University
  • Professor Stefan Witte, Delft University of Technology

1 Small-Cap Stock with Exciting Potential and 2 to Be Wary Of

WING Cover Image

Many small-cap stocks have limited Wall Street coverage, giving savvy investors the chance to act before everyone else catches on. But the flip side is that these businesses have increased downside risk because they lack the scale and staying power of their larger competitors.

The downside that can come from buying these securities is precisely why we started StockStory - to isolate the long-term winners from the losers so you can invest with confidence. Keeping that in mind, here is one small-cap stock that could amplify your portfolio’s returns and two that could be down big.

Two Small-Cap Stocks to Sell:

American Woodmark (AMWD)

Market Cap: $852.8 million

Starting as a small millwork shop, American Woodmark (NASDAQ: AMWD) is a cabinet manufacturing company that helps customers from inspiration to installation.

Why Do We Steer Clear of AMWD?

  1. Customers postponed purchases of its products and services this cycle as its revenue declined by 8.1% annually over the last two years
  2. Flat earnings per share over the last five years underperformed the sector average
  3. Capital intensity has ramped up over the last five years as its free cash flow margin decreased by 5.7 percentage points

At $57.49 per share, American Woodmark trades at 7.6x forward P/E. Read our free research report to see why you should think twice about including AMWD in your portfolio.

Kyndryl (KD)

Market Cap: $9.16 billion

Born from IBM's managed infrastructure services business in a 2021 spinoff, Kyndryl (NYSE: KD) is the world's largest IT infrastructure services provider that designs, builds, and manages technology environments for enterprise customers.

Why Is KD Not Exciting?

  1. Products and services are facing significant end-market challenges during this cycle as sales have declined by 6% annually over the last four years
  2. Lacking free cash flow generation means it has few chances to reinvest for growth, repurchase shares, or distribute capital
  3. Negative returns on capital show management lost money while trying to expand the business

Kyndryl is trading at $39.35 per share, or 19x forward P/E. Dive into our free research report to see why there are better opportunities than KD.

One Small-Cap Stock to Buy:

Wingstop (WING)

Market Cap: $9.00 billion

The passion project of two chicken wing aficionados in Texas, Wingstop (NASDAQ: WING) is a popular fast-food chain known for its flavorful and crispy chicken wings offered in a variety of sauces and seasonings.

Why Do We Love WING?

  1. Average same-store sales growth of 16.9% over the past two years indicates its restaurants are resonating with diners
  2. Healthy operating margin of 25.3% shows it’s a well-run company with efficient processes
  3. Impressive free cash flow profitability enables the company to fund new investments or reward investors with share buybacks/dividends

Wingstop’s stock price of $320 implies a valuation ratio of 81.1x forward P/E. Is now a good time to buy? Find out in our full research report, it’s free.

Stocks We Like Even More

Donald Trump’s victory in the 2024 U.S. Presidential Election sent major indices to all-time highs, but stocks have retraced as investors debate the health of the economy and the potential impact of tariffs.

While this leaves much uncertainty around 2025, a few companies are poised for long-term gains regardless of the political or macroeconomic climate, like our Top 5 Strong Momentum Stocks for this week. This is a curated list of our High Quality stocks that have generated a market-beating return of 176% over the last five years.

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 Comfort Systems (+782% five-year return). Find your next big winner with StockStory today for free.

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