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.
Navigating this part of the market can be tricky, which is why we built StockStory to help you separate the winners from the laggards. That said, here are three Russell 2000 stocks to steer clear of and some alternatives to watch instead.
Market Cap: $3.57 billion
Co-founded by former Apple CEO John Sculley, Zeta Global (NYSE:ZETA) provides software and data analytics tools that help companies market their products to billions of customers.
Zeta’s stock price of $15.24 implies a valuation ratio of 2.5x forward price-to-sales. If you’re considering ZETA for your portfolio, see our FREE research report to learn more.
Market Cap: $3.87 billion
Founded in 1951, Champion Homes (NYSE:SKY) is a manufacturer of modular homes and buildings in North America.
At $67.21 per share, Champion Homes trades at 17.1x forward P/E. Dive into our free research report to see why there are better opportunities than SKY.
Market Cap: $2.26 billion
Created through the 2021 merger of Third Point Reinsurance and Sirius International Insurance Group, SiriusPoint (NYSE:SPNT) is a global underwriter that provides multi-line insurance and reinsurance products and services to businesses, government entities, and other risk-bearing vehicles worldwide.
SiriusPoint is trading at $19.38 per share, or 0.8x trailing 12-month price-to-sales. Check out our free in-depth research report to learn more about why SPNT doesn’t pass our bar.
Market indices reached historic highs following Donald Trump’s presidential victory in November 2024, but the outlook for 2025 is clouded by new trade policies that could impact business confidence and growth.
While this has caused many investors to adopt a "fearful" wait-and-see approach, we’re leaning into our best ideas that can grow regardless of the political or macroeconomic climate. Take advantage of Mr. Market by checking out our Top 5 Growth Stocks for this month. 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-micro-cap company Kadant (+351% 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
