The Russell 2000 (^RUT) is home to many small-cap stocks, offering investors the chance to uncover hidden gems before the broader market catches on. However, these companies often come with higher volatility and risk, as their smaller size makes them more vulnerable to economic downturns.
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 be the next breakout winners and one best left off your watchlist.
One Stock to Sell:
Coty (COTY)
Market Cap: $2.17 billion
With a portfolio boasting many household brands, Coty (NYSE: COTY) is a beauty products powerhouse spanning cosmetics, fragrances, and skincare.
Why Are We Bearish on COTY?
- Organic sales performance over the past two years indicates the company may need to make strategic adjustments or rely on M&A to catalyze faster growth
- Sales are projected to tank by 1.2% over the next 12 months as demand evaporates
- Issuance of new shares over the last three years caused its earnings per share to fall by 26.6% annually while its revenue grew
At $2.48 per share, Coty trades at 8.2x forward P/E. Check out our free in-depth research report to learn more about why COTY doesn’t pass our bar.
Two Stocks to Watch:
Mirion (MIR)
Market Cap: $3.95 billion
With its technology protecting workers in over 130 countries and equipment used in 80% of cancer centers worldwide, Mirion Technologies (NYSE: MIR) provides radiation detection, measurement, and monitoring solutions for medical, nuclear energy, defense, and scientific research applications.
Why Do We Watch MIR?
- Impressive 11.7% annual revenue growth over the last two years indicates it’s winning market share this cycle
- Adjusted operating margin improvement of 13.3 percentage points over the last five years demonstrates its ability to scale efficiently
- Free cash flow margin grew by 13.7 percentage points over the last five years, giving the company more chips to play with
Mirion is trading at $16.34 per share, or 26.3x forward P/E. Is now the time to initiate a position? Find out in our full research report, it’s free.
PJT (PJT)
Market Cap: $3.87 billion
Spun off from Blackstone in 2015 and founded by former Morgan Stanley executive Paul J. Taubman, PJT Partners (NYSE: PJT) is an advisory-focused investment bank that provides strategic advice, restructuring services, and fundraising solutions to corporations, boards, and investment firms.
Why Is PJT on Our Radar?
- Market share has increased this cycle as its 20.6% annual revenue growth over the last two years was exceptional
- Share buybacks catapulted its annual earnings per share growth to 42.2%, which outperformed its revenue gains over the last two years
- Market-beating return on equity illustrates that management has a knack for investing in profitable ventures
PJT’s stock price of $152 implies a valuation ratio of 18.3x forward P/E. Is now the right time to buy? See for yourself in our in-depth research report, it’s free.
Stocks We Like Even More
ONE MORE THING: Top 5 Growth Stocks. The biggest stock winners almost always had one thing in common before they ran. Revenue growing like crazy. Meta. CrowdStrike. Broadcom. Our AI flagged all three. They returned 315%, 314%, and 455%, respectively.
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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-micro-cap company Tecnoglass (+1,552% between June 2020 and June 2025). Find your next big winner with StockStory today.
