Small-cap stocks in the Russell 2000 (^RUT) can be a goldmine for investors looking beyond the usual large-cap names. But with less stability and fewer resources than their bigger counterparts, these companies face steeper challenges in scaling their businesses.
Picking the right small caps isn’t easy, and that’s exactly why StockStory exists - to help you focus on the best opportunities. That said, here are two Russell 2000 stocks that could deliver strong gains and one best left off your watchlist.
One Stock to Sell:
Utz (UTZ)
Market Cap: $1.25 billion
Tracing its roots back to 1921 when Bill and Salie Utz began making potato chips in their kitchen, Utz Brands (NYSE: UTZ) offers salty snacks such as potato chips, tortilla chips, pretzels, cheese snacks, and ready-to-eat popcorn, among others.
Why Do We Avoid UTZ?
- Core business is underperforming as its organic revenue has disappointed over the past two years, suggesting it might need acquisitions to stimulate growth
- Subscale operations are evident in its revenue base of $1.45 billion, meaning it has fewer distribution channels than its larger rivals
- Underwhelming 0% return on capital reflects management’s difficulties in finding profitable growth opportunities
At $14.15 per share, Utz trades at 17.5x forward P/E. If you’re considering UTZ for your portfolio, see our FREE research report to learn more.
Two Stocks to Watch:
Terex (TEX)
Market Cap: $7.80 billion
With humble beginnings as a dump truck company, Terex (NYSE: TEX) today manufactures lifting and material handling equipment designed to move and hoist heavy goods and materials.
Why Could TEX Be a Winner?
- Annual revenue growth of 14.1% over the last five years was superb and indicates its market share increased during this cycle
- Exciting sales outlook for the upcoming 12 months calls for 27.6% growth, an acceleration from its two-year trend
- Free cash flow margin increased by 6 percentage points over the last five years, giving the company more capital to invest or return to shareholders
Terex is trading at $68.21 per share, or 12.4x forward P/E. Is now the right time to buy? Find out in our full research report, it’s free.
WisdomTree (WT)
Market Cap: $3.36 billion
Originally founded as a financial media company before pivoting to ETF management in 2006, WisdomTree (NYSE: WT) is a financial services company that creates and manages exchange-traded funds (ETFs) and other investment products for individual and institutional investors.
Why Should You Buy WT?
- Market share has increased this cycle as its 25.9% annual revenue growth over the last two years was exceptional
- Performance over the past two years was turbocharged by share buybacks, which enabled its earnings per share to grow faster than its revenue
- Industry-leading 16.3% return on equity demonstrates management’s skill in finding high-return investments
WisdomTree’s stock price of $22.69 implies a valuation ratio of 18.1x forward P/E. Is now a good time to buy? See for yourself in our full research report, it’s free.
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Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,460% between June 2020 and June 2025) as well as under-the-radar businesses like the once-small-cap company Comfort Systems (+1,154% between June 2020 and June 2025). Find your next big winner with StockStory today.
