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.

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. That said, here is one small-cap stock that could be the next 100 bagger and two best left ignored.

Two Small-Cap Stocks to Sell:

MSA Safety (MSA)

Market Cap: $6.69 billion

Founded in 1914 as Mine Safety Appliances to protect coal miners from dangerous gases, MSA Safety (NYSE: MSA) designs and manufactures advanced safety products that protect workers and facilities across industries including fire service, energy, construction, and manufacturing.

Why Is MSA Not Exciting?

1. 4.6% annual revenue growth over the last two years was slower than its business services peers
2. Subscale operations are evident in its revenue base of $1.83 billion, meaning it has fewer distribution channels than its larger rivals
3. Earnings growth underperformed the sector average over the last two years as its EPS grew by just 9.3% annually

MSA Safety’s stock price of $170.88 implies a valuation ratio of 20.5x forward P/E. If you’re considering MSA for your portfolio, see our FREE research report to learn more.

Independent Bank (INDB)

Market Cap: $3.54 billion

Tracing its roots back to 1907 and serving as a financial cornerstone in New England for over a century, Independent Bank Corp. (NASDAQ: INDB) operates as the holding company for Rockland Trust, providing banking, investment, and financial services across Eastern Massachusetts and Rhode Island.

Why Does INDB Fall Short?

1. Sales tumbled by 3.3% annually over the last two years, showing market trends are working against its favor during this cycle
2. Concessions to defend its market share have ramped up over the last two years as its net interest margin decreased by 29.7 basis points (100 basis points = 1 percentage point)
3. Earnings per share decreased by more than its revenue over the last two years, showing each sale was less profitable

Independent Bank is trading at $70.99 per share, or 1x forward P/B. Dive into our free research report to see why there are better opportunities than INDB.

One Small-Cap Stock to Watch:

Shake Shack (SHAK)

Market Cap: $3.72 billion

Started as a hot dog cart in New York City's Madison Square Park, Shake Shack (NYSE: SHAK) is a fast-food restaurant known for its burgers and milkshakes.

Why Does SHAK Catch Our Eye?

1. Rapid rollout of new restaurants to capitalize on market opportunities makes sense given its strong same-store sales performance
2. Average same-store sales growth of 2.7% over the past two years indicates its restaurants are resonating with diners
3. Free cash flow margin grew by 2.1 percentage points over the last year, giving the company more chips to play with

At $92.08 per share, Shake Shack trades at 59.8x forward P/E. Is now the right time to buy? See for yourself in our comprehensive research report, it’s free.

Stocks We Like Even 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 9 Market-Beating Stocks. 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

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