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

3 Russell 2000 Stocks We Think Twice About

SANM Cover Image

The Russell 2000 (^RUT) is packed with potential breakout stocks, thanks to its focus on smaller companies with high growth potential. However, smaller size also means these businesses often lack the resilience and financial flexibility of large-cap firms, making careful selection crucial.

Navigating this part of the market can be tricky, which is why we built StockStory to help you separate the winners from the laggards. Keeping that in mind, here are three Russell 2000 stocks that don’t make the cut and some better choices instead.

Sanmina (SANM)

Market Cap: $6.24 billion

Founded in 1980, Sanmina (NASDAQ: SANM) is an electronics manufacturing services company offering end-to-end solutions for various industries.

Why Do We Pass on SANM?

  1. Products and services are facing significant end-market challenges during this cycle as sales have declined by 6% annually over the last two years
  2. High input costs result in an inferior gross margin of 8.2% that must be offset through higher volumes
  3. Earnings per share have dipped by 3.8% annually over the past two years, which is concerning because stock prices follow EPS over the long term

Sanmina is trading at $117.58 per share, or 17x forward P/E. Read our free research report to see why you should think twice about including SANM in your portfolio.

Greenbrier (GBX)

Market Cap: $1.39 billion

Having designed the industry’s first double-decker railcar in the 1980s, Greenbrier (NYSE: GBX) supplies the freight rail transportation industry with railcars and related services.

Why Does GBX Fall Short?

  1. Sales tumbled by 4.5% annually over the last two years, showing market trends are working against its favor during this cycle
  2. Gross margin of 13.5% is below its competitors, leaving less money to invest in areas like marketing and R&D
  3. Cash burn makes us question whether it can achieve sustainable long-term growth

Greenbrier’s stock price of $45.11 implies a valuation ratio of 4.7x forward EV-to-EBITDA. Dive into our free research report to see why there are better opportunities than GBX.

NV5 Global (NVEE)

Market Cap: $1.51 billion

Operating from over 100 locations across the U.S. and internationally, NV5 Global (NASDAQ: NVEE) provides engineering, environmental, geospatial, and technical consulting services to public and private sector clients for infrastructure and building projects.

Why Are We Hesitant About NVEE?

  1. Day-to-day expenses have swelled relative to revenue over the last five years as its adjusted operating margin fell by 5.1 percentage points
  2. Incremental sales over the last two years were much less profitable as its earnings per share fell by 2.8% annually while its revenue grew
  3. Free cash flow margin shrank by 13.7 percentage points over the last five years, suggesting the company is consuming more capital to stay competitive

At $22.56 per share, NV5 Global trades at 17x forward P/E. To fully understand why you should be careful with NVEE, check out our full research report (it’s free).

Stocks We Like More

Donald Trump’s April 2024 "Liberation Day" tariffs sent markets into a tailspin, but stocks have since rebounded strongly, proving that knee-jerk reactions often create the best buying opportunities.

The smart money is already positioning for the next leg up. Don’t miss out on the recovery - check out our Top 5 Growth Stocks for this month. 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-micro-cap company Tecnoglass (+1,754% 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.

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