Various investment styles exist, with some investors opting for income-generating assets, while others focus on value or specific industries.
Of course, some investors prefer a less-conservative approach, such as small-cap stocks, which sport remarkable growth potential due to being in their early stages.
After all, don’t we all dream of getting in on the next big thing?
Three small-caps – Turtle Beach HEAR, Universal Insurance Holdings UVE, and Horizon Technology Finance HRZN – all boast strong growth trajectories.
In addition, all three sport a favorable Zacks Rank, indicating that analysts have recently become optimistic about their near-term earnings outlooks. Let’s take a closer look at each one.
Turtle Beach
Turtle Beach Corporation is an audio technology company that designs products for consumer, commercial, and healthcare markets. The stock currently carries a Zacks Rank #2 (Buy), with earnings expectations increasing across all timeframes.
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It’s hard to ignore the company’s growth profile, with earnings forecasted to climb 80% in its current fiscal year on 14% higher revenues. And in FY24, earnings and revenue are estimated to grow an additional 150% and 8%, respectively.
The stock carries a Style Score of “A” for Growth.
The company posted strong quarterly results in its latest release, delivering a 35% EPS beat and a solid 11.6% revenue surprise. The market reacted strongly to the results, with HEAR shares seeing a boost post-earnings.
Image Source: Zacks Investment Research
Universal Insurance Holdings
Universal Insurance Holdings is a leading holding company of property and casualty insurance and value-added insurance services. Analysts have become visibly optimistic regarding UVE’s current fiscal year, with the annual EPS estimate being revised 14% higher since May of 2022.
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Universal Insurance is forecasted to witness significant earnings growth, with the $2.00 per share estimate implying an improvement of nearly 600% year-over-year. Looking ahead to next year, estimates call for an additional 20% of earnings growth on 9% higher revenues.
For those with an appetite for income, UVE shares have that covered; the company’s annual dividend presently yields a solid 4.2%, well above the Zacks Finance sector average.
Image Source: Zacks Investment Research
Horizon Technology Finance
Horizon Technology Finance makes secured loans to development-stage companies in the technology, life science, healthcare information and services, and cleantech industries. The stock presently boasts a Zacks Rank #1 (Strong Buy), with earnings expectations increasing nearly across the board.
Shares could entice value-focused investors, with the current 7.6X forward earnings multiple sitting nicely beneath the 9.9X five-year median and Zacks sector average.
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Like UVE, Horizon Technology Finance rewards its shareholders handsomely, with its dividend presently yielding a double-digit 10.3% annually. The company has upped its payout three times over the last five years.
Image Source: Zacks Investment Research
And to top it off, HRZN is expected to witness solid growth in its current fiscal year, with estimates calling for 16% earnings growth on 36% higher revenues.
Bottom Line
While small caps are typically more volatile, their growth potential is challenging to ignore.
And for those with a less-conservative approach, all three stocks above – Turtle Beach HEAR, Universal Insurance Holdings UVE, and Horizon Technology Finance HRZN – could be solid watchlist additions.
All three sport a favorable Zacks Rank and are forecasted to enjoy positive earnings and revenue growth, undoubtedly a strong pairing.
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Horizon Technology Finance Corporation (HRZN) : Free Stock Analysis Report
UNIVERSAL INSURANCE HOLDINGS INC (UVE) : Free Stock Analysis Report
Turtle Beach Corporation (HEAR) : Free Stock Analysis Report
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.