Investors looking for hidden gems should keep an eye on small-cap stocks because they’re frequently overlooked by Wall Street. Many opportunities exist in this part of the market, but it is also a high-risk, high-reward environment due to the lack of reliable analyst price targets.
These trade-offs can cause headaches for even the most seasoned professionals, which is why we started StockStory - to help you separate the good companies from the bad. Keeping that in mind, here are two small-cap stocks that could amplify your portfolio’s returns and one that may have trouble.
One Small-Cap Stock to Sell:
Zevia (ZVIA)
Market Cap: $207.3 million
With a primary focus on soda but also a presence in energy drinks and teas, Zevia (NYSE: ZVIA) is a better-for-you beverage company.
Why Are We Hesitant About ZVIA?
- Sales stagnated over the last three years and signal the need for new growth strategies
- Suboptimal cost structure is highlighted by its history of operating margin losses
- Cash-burning history makes us doubt the long-term viability of its business model
Zevia is trading at $3.06 per share, or 1.2x forward price-to-sales. If you’re considering ZVIA for your portfolio, see our FREE research report to learn more.
Two Small-Cap Stocks to Watch:
Community Bank (CBU)
Market Cap: $3.18 billion
Tracing its roots back to 1866 in upstate New York, Community Financial System (NYSE: CBU) is a financial holding company that provides banking, employee benefits, wealth management, and insurance services to retail, commercial, and municipal customers.
Why Do We Like CBU?
- Impressive 9.5% annual revenue growth over the last two years indicates it’s winning market share this cycle
- Earnings per share grew by 0.8% annually over the last two years and easily exceeded the peer group average
- Expected tangible book value per share growth of 18.6% for the next year suggests its capital position will strengthen considerably
At $60.23 per share, Community Bank trades at 1.6x forward P/B. Is now a good time to buy? Find out in our full research report, it’s free.
Commerce Bancshares (CBSH)
Market Cap: $8.39 billion
Founded in 1865 during the post-Civil War economic boom, Commerce Bancshares (NASDAQGS:CBSH) is a Midwest-focused bank holding company that provides retail, commercial, and wealth management services to individuals and businesses.
Why Is CBSH Interesting?
- Net interest margin grew by 45.7 basis points (100 basis points = 1 percentage point) over the last two years, giving the firm more chips to play with
- Share repurchases have amplified shareholder returns as its annual earnings per share growth of 7.2% exceeded its revenue gains over the last two years
- ROE punches in at 17.1%, illustrating management’s expertise in identifying profitable investments
Commerce Bancshares’s stock price of $62.88 implies a valuation ratio of 2.2x forward P/B. Is now the right time to buy? See for yourself in our full research report, it’s free.
Stocks We Like Even More
When Trump unveiled his aggressive tariff plan in April 2025, markets tanked as investors feared a full-blown trade war. But those who panicked and sold missed the subsequent rebound that’s already erased most losses.
Don’t let fear keep you from great opportunities and take a look at 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 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-small-cap company Comfort Systems (+782% 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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