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.
Image Source: Zacks Investment Research
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.
Image Source: Zacks Investment Research
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.
Image Source: Zacks Investment Research
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.
7 Best Stocks for the Next 30 Days
Just released: Experts distill 7 elite stocks from the current list of 220 Zacks Rank #1 Strong Buys. They deem these tickers “Most Likely for Early Price Pops.”
Since 1988, the full list has beaten the market more than 2X over with an average gain of +24.3% per year. So be sure to give these hand-picked 7 your immediate attention.
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
To read this article on Zacks.com click here.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
