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 is one small-cap stock that could amplify your portfolio’s returns and two best left ignored.
Two Small-Cap Stocks to Sell:
Ridgepost Capital (RPC)
Market Cap: $895.5 million
Operating as a bridge between institutional investors and hard-to-access private market opportunities, Ridgepost Capital (NYSE: RPC) is an alternative asset management firm that provides access to private equity, venture capital, impact investing, and private credit opportunities in the middle and lower middle markets.
Why Does RPC Fall Short?
- Annual earnings per share growth of 6.3% underperformed its revenue over the last two years, showing its incremental sales were less profitable
- Low return on equity reflects management’s struggle to allocate funds effectively
At $7.75 per share, Ridgepost Capital trades at 7.1x forward P/E. Check out our free in-depth research report to learn more about why RPC doesn’t pass our bar.
TriCo Bancshares (TCBK)
Market Cap: $1.66 billion
Founded in 1975 and headquartered in Chico, California, TriCo Bancshares (NASDAQ: TCBK) operates Tri Counties Bank, providing personal, small business, and commercial banking services through branches across California.
Why Are We Cautious About TCBK?
- Muted 6.6% annual net interest income growth over the last five years shows its demand lagged behind its banking peers
- Earnings per share lagged its peers over the last five years as they only grew by 7.4% annually
- Estimated tangible book value per share growth of 8.9% for the next 12 months implies profitability will slow from its two-year trend
TriCo Bancshares’s stock price of $53.92 implies a valuation ratio of 1.2x forward P/B. Read our free research report to see why you should think twice about including TCBK in your portfolio.
One Small-Cap Stock to Buy:
Graham Corporation (GHM)
Market Cap: $1.20 billion
Founded when its founder patented a unique design for a vacuum system used in the sugar refining process, Graham (NYSE: GHM) provides vacuum and heat transfer equipment for the energy, petrochemical, refining, and chemical sectors.
Why Do We Love GHM?
- Impressive 20.3% annual revenue growth over the last five years indicates it’s winning market share this cycle
- Operating profits and efficiency rose over the last five years as it benefited from some fixed cost leverage
- Incremental sales over the last two years have been highly profitable as its earnings per share increased by 31.5% annually, topping its revenue gains
Graham Corporation is trading at $121.00 per share, or 66.6x forward P/E. Is now the time to initiate a position? See for yourself in our comprehensive research report, it’s free.
High-Quality Stocks for All Market Conditions
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Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,326% between June 2020 and June 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.
