Small-cap stocks can be incredibly lucrative investments because their lack of analyst coverage leads to frequent mispricings. However, these businesses (and their stock prices) often stay small because their subscale operations make it harder to expand their competitive moats.
The downside that can come from buying these securities is precisely why we started StockStory - to isolate the long-term winners from the losers so you can invest with confidence. That said, here is one small-cap stock that could be the next 100 bagger and two that may have trouble.
Two Small-Cap Stocks to Sell:
Pitney Bowes (PBI)
Market Cap: $1.58 billion
With a century-long history dating back to 1920 and processing over 15 billion pieces of mail annually, Pitney Bowes (NYSE: PBI) provides shipping, mailing technology, logistics, and financial services to businesses of all sizes.
Why Are We Cautious About PBI?
- Customers postponed purchases of its products and services this cycle as its revenue declined by 11.8% annually over the last five years
- Projected sales decline of 3.9% over the next 12 months indicates demand will continue deteriorating
At $10.51 per share, Pitney Bowes trades at 7.3x forward P/E. To fully understand why you should be careful with PBI, check out our full research report (it’s free).
Autoliv (ALV)
Market Cap: $9.19 billion
With products estimated to save over 30,000 lives annually in traffic accidents worldwide, Autoliv (NYSE: ALV) develops and manufactures passive safety systems for vehicles, including airbags, seatbelts, and steering wheels that protect occupants during crashes.
Why Does ALV Give Us Pause?
- Annual sales growth of 1.6% over the last two years lagged behind its industrials peers as its large revenue base made it difficult to generate incremental demand
- Projected sales growth of 2.1% for the next 12 months suggests sluggish demand
- Gross margin of 17.9% is below its competitors, leaving less money to invest in areas like marketing and R&D
Autoliv’s stock price of $123.04 implies a valuation ratio of 11.6x forward P/E. If you’re considering ALV for your portfolio, see our FREE research report to learn more.
One Small-Cap Stock to Buy:
TPG (TPG)
Market Cap: $7.14 billion
Founded in 1992 and managing over 300 active portfolio companies across more than 30 countries, TPG (NASDAQ: TPG) is a global alternative asset management firm that invests across private equity, credit, real estate, and public market strategies.
Why Is TPG a Good Business?
- Annual revenue growth of 27.2% over the past two years was outstanding, reflecting market share gains this cycle
- Incremental sales over the last two years have been highly profitable as its earnings per share increased by 34.6% annually, topping its revenue gains
TPG is trading at $45.19 per share, or 14.8x forward P/E. Is now the time to initiate a position? Find out in our full research report, it’s free.
High-Quality Stocks for All Market Conditions
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 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 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.
