The Russell 2000 (^RUT) is packed with potential breakout stocks, thanks to its focus on smaller companies with high growth potential. However, smaller size also means these businesses often lack the resilience and financial flexibility of large-cap firms, making careful selection crucial.
Picking the right small caps isn't easy, and that's exactly why StockStory exists - to help you focus on the best opportunities. That said, here are three Russell 2000 stocks that don't make the cut and some better choices instead.
Market Cap: $2.93 billion
Processing over 325 billion data points annually from more than 150 million connected devices, Alarm.com (NASDAQ:ALRM) provides cloud-based platforms that enable residential and commercial property owners to remotely monitor and control their security, video, energy, and other connected devices.
Why Does ALRM Give Us Pause?
At $58.75 per share, Alarm.com trades at 3.5x forward price-to-sales. If you're considering ALRM for your portfolio, see our FREE research report to learn more.
Market Cap: $1.89 billion
Gibraltar (NASDAQ:ROCK) makes renewable energy, agriculture technology and infrastructure products. Its mission statement is to make everyday living more sustainable.
Why Do We Think Twice About ROCK?
Gibraltar's stock price of $64.06 implies a valuation ratio of 12.8x forward P/E. To fully understand why you should be careful with ROCK, check out our full research report (it's free).
Market Cap: $2.33 billion
Founded in 1890 in Walla Walla, Washington, and evolving through more than a century of economic cycles, Banner Corporation (NASDAQ:BANR) operates Banner Bank, providing commercial banking services, loans, and financial products to individuals and businesses across Washington, Oregon, California, Idaho, and Utah.