3 Small Caps With Excellent Growth Prospects

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Compiled by Luis Gonzalez: The following is a list of small cap stocks, with market caps between $300M - $400M, that have excellent growth prospects, with higher projected EPS growth rates than their industry competitors. All of these companies also have the following characteristics:

- EPS and revenue grew faster than their industry competitors over the last five years
- Capital spending accelerated at a faster rate than their competitors (theoretically, this makes them more competitive over the coming years)
- Cashflow growth has accelerated faster than their industry competitors over the last five years

We're not going to go into detailed analysis for each company. The goal here is to give growth-oriented investors a starting point for their own analysis.

All growth stats sourced from Fidelity, short float and performance data sourced from Finviz.

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3. Visualize market cap changes for the top stocks mentioned 

 

Sorted alphabetically by company name.

1. Hercules Technology Growth Capital, Inc. (HTGC): Diversified Investments Industry. Market cap of $391.72M. EPS have grown by 4.28% over the last five years vs. industry average at 0.42%. EPS projected to grow by 15.0% over the next five years vs. industry average at 12.8%. Revenue has grown by 47.42% over the last five years vs. industry average at 6.55%. Capital spending has grown by 15.22% over the last five years vs. industry average at 7.85%. The company's cash flow has grown by 45.62% over the last five years vs. industry average at 5.69%. Short float at 2.43%, which implies a short ratio of 2.94 days. The stock has gained 20.2% over the last year.
 
2. Medifast Inc. (MED): Specialty Retail Industry. Market cap of $381.34M. EPS have grown by 42.06% over the last five years vs. industry average at -2.97%. EPS projected to grow by 25.0% over the next five years vs. industry average at 4.44%. Revenue has grown by 43.37% over the last five years vs. industry average at 5.3%. Capital spending has grown by 20.01% over the last five years vs. industry average at 5.89%. The company's cash flow has grown by 41.32% over the last five years vs. industry average at -2.4%. Short float at 20.8%, which implies a short ratio of 8.96 days. The stock has gained 46.77% over the last year.
 
3. ShoreTel, Inc. (SHOR): Communication Equipment Industry. Market cap of $357.64M. EPS have grown by 57.42% over the last five years vs. industry average at 8.63%. EPS projected to grow by 18.33% over the next five years vs. industry average at 14.1%. Revenue has grown by 33.14% over the last five years vs. industry average at 16.84%. Capital spending has grown by 51.12% over the last five years vs. industry average at 9.44%. The company's cash flow has grown by 65.31% over the last five years vs. industry average at 10.39%. Short float at 2.58%, which implies a short ratio of 3.23 days. The stock has gained 42.94% over the last year.



The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ OMX Group, Inc.



This article appears in: Investing , Investing Ideas , Stocks

Referenced Stocks: HTGC , MED , SHOR

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