Many small-cap stocks have limited Wall Street coverage, giving savvy investors the chance to act before everyone else catches on. But the flip side is that these businesses have increased downside risk because they lack the scale and staying power of their larger competitors.
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. That said, here are three small-cap stocks to swipe left on and some alternatives you should look into instead.
Wolverine Worldwide (WWW)
Market Cap: $1.43 billion
Founded in 1883, Wolverine Worldwide (NYSE: WWW) is a global footwear company with a diverse portfolio of brands including Merrell, Hush Puppies, and Saucony.
Why Should You Sell WWW?
- Products and services fail to spark excitement with consumers, as seen in its flat sales over the last five years
- Lacking free cash flow generation means it has few chances to reinvest for growth, repurchase shares, or distribute capital
- Waning returns on capital from an already weak starting point displays the inefficacy of management’s past and current investment decisions
At $17.41 per share, Wolverine Worldwide trades at 13.2x forward P/E. Read our free research report to see why you should think twice about including WWW in your portfolio.
Hub Group (HUBG)
Market Cap: $2.52 billion
Started with $10,000, Hub Group (NASDAQ: HUBG) is a provider of intermodal, truck brokerage, and logistics services, facilitating transportation solutions for businesses worldwide.
Why Should You Dump HUBG?
- Underwhelming unit sales over the past two years indicate demand is soft and that the company may need to revise its strategy
- Earnings per share decreased by more than its revenue over the last two years, showing each sale was less profitable
- Eroding returns on capital suggest its historical profit centers are aging
Hub Group is trading at $41.42 per share, or 20.1x forward P/E. If you’re considering HUBG for your portfolio, see our FREE research report to learn more.
DigitalBridge (DBRG)
Market Cap: $2.58 billion
Transforming from a traditional real estate investor to a digital-focused powerhouse in 2021, DigitalBridge Group (NYSE: DBRG) is a global digital infrastructure investment firm that manages capital and operates assets across data centers, cell towers, fiber networks, and edge infrastructure.
Why Does DBRG Fall Short?
- Sales tumbled by 37.5% annually over the last five years, showing market trends are working against its favor during this cycle
- Below-average return on equity indicates management struggled to find compelling investment opportunities
- Negative earnings profile makes it challenging to secure favorable financing terms from lenders
DigitalBridge’s stock price of $14.06 implies a valuation ratio of 1.1x forward P/E. Check out our free in-depth research report to learn more about why DBRG doesn’t pass our bar.
Stocks We Like More
The market’s up big this year - but there’s a catch. Just 4 stocks account for half the S&P 500’s entire gain. That kind of concentration makes investors nervous, and for good reason. While everyone piles into the same crowded names, smart investors are hunting quality where no one’s looking - and paying a fraction of the price. Check out the high-quality names we’ve flagged in our Top 9 Market-Beating Stocks. This is a curated list of our High Quality stocks that have generated a market-beating return of 244% over the last five years (as of June 30, 2025).
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 for free. Find your next big winner with StockStory today. Find your next big winner with StockStory today
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