Zacks Market Edge Highlights: Soundhound AI, Afya, Castle Biosciences, TriMas and Immersion – July 22, 2024

For immediate release

Chicago, IL – July 22, 2024 – Zacks Market Edge is a weekly podcast from Zacks Stock Strategist Tracey Ryniec. Each week, Tracey is joined by guests to discuss the hottest investing topics in stocks, bonds and ETFs and how it impacts your life. To listen to the podcast, click here: https://www.zacks.com/stock/news/2305460/5-top-small-cap-stocks-to-buy-now

5 Best Small Cap Stocks to Buy Now

Welcome to episode #409 of the Zacks Market Edge Podcast.

  • (0:30) – Should You Add More Small-Cap Stocks to Your Portfolio?
  • (5:20) – Stock Screener Run Down: How to Find the Best Investments for You
  • (14:05) – Tracey’s Top Picks for Your Watchlist
  • (32:10) – Episode Summary: SOUN, AFYA, CSTL, TRS, IMMR
  • [email protected]

Each week, host and Zacks Equity Strategist Tracey Ryniec and guests discuss the hottest investing topics in stocks, bonds and ETFs and how they impact your life.

This week, Tracey goes solo on a quest to find the best small cap stocks. Small caps have been underperforming large caps for years. With everyone buying the Mag 7 stocks, the gap between large caps and small caps has become even more pronounced over the past year.

Until July 2024, when small-cap stocks suddenly showed a massive 10% rally.

Could this be a real turnaround?

Should You Add Small Caps to Your Portfolio?

Screening for top small caps

Tracey decided to run one of the Zacks Premium screens for this podcast. It looks for Zacks Rank #1 (Strong Buy) small cap stocks.

Originally, the screen searched for stocks under $1 billion, but that only returned 8 stocks. Tracey adjusted the market cap to $2 billion, and since many investors still consider $2 billion to be “small.”

That review found 23 small-cap stocks that were Zacks Rank #1 (Strong Buys), Zacks’ highest recommendation, and which also demonstrated earnings growth.

5 Best Small Cap Stocks to Buy Now

1. Soundhound AI, Inc. (SOUND Free report)

Soundhound AI is a Voice AI and speech recognition company that was founded in 2005. It has a market cap of $1.6 billion. At the time of the podcast, Soundhound was a Zacks Rank #1 (Strong Buy) stock but has dropped to a #2 (Buy) stock.

Shares of Soundhound have risen sharply in 2024, up 135%. Earnings are expected to grow 13.2% in 2024.

Should Soundhound AI be on your small cap shortlist?

2. Afya Ltd. (AFYA Free report)

Afya Ltd is the largest hub of education and solutions for medical practice in Brazil. It serves 334,000 physicians and medical students. Afya has a market capitalization of $1.6 billion.

Shares of Afya have fallen 19.1% this year. But earnings are expected to rise 27.3% in 2024.

Should Afya be on your small cap shortlist?

3. Kasteel Biosciences, Inc. (CSTL Free report)

Castle Biosciences is a molecular diagnostics company for dermatological cancers. It has a market cap of $523 million. Castle Biosciences was a Zacks Rank #1 (Strong Buy) stock at the time of the podcast but has now dropped to a Zacks Rank #2 (Buy) stock.

Shares of Castle Biosciences are down 12.2% since the beginning of the year. Earnings are expected to rise 20.6% in 2024.

Should Castle Biosciences be on your small cap shortlist?

4. TriMas Corp. (TRS Free report)

TriMas Corp. produces a diverse range of products primarily for the consumer, aerospace and defense, and industrial end markets. It has a market cap of $1.1 billion. TriMas was a Zacks Rank #1 (Strong Buy) stock at the time of the podcast but has fallen to a #2 (Buy) stock.

Shares of TriMas have risen 6.1% this year, and earnings are expected to rise 16.7% in 2024.

Should TriMas be on your small cap shortlist?

5. Immersion Corp. (IMM Free report)

Immersion Corp. makes touch feedback technology that is used in more than 3 billion devices worldwide. It has a market cap of $389 million.

Shares of Immersion are up 73% this year, and earnings are expected to grow 48% in 2024.

Should Immersion be on your small cap shortlist?

What else should you know about screening top small cap stocks?

Listen to this week’s video podcast to find out.

Why haven’t you checked out Zacks’ top stocks?

Since 2000, our best stock-picking strategies have blown away the S&P’s +7.0 average annual gain. Amazingly, they’ve been up by average gains of +44.9%, +48.4% And +55.2% per year.

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Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice or a recommendation to buy, sell or hold any security. No recommendation or advice is given as to whether any investment is suitable for any particular investor. No assumption should be made that investments in identified and described securities, companies, sectors or markets were or will be profitable. All information is current as of the date of this document and is subject to change without notice. Views or opinions expressed may not reflect those of the company as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management of securities. These returns are derived from hypothetical portfolios of Zacks Rank = 1 stocks that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. See https://www.zacks.com/performance for information about the performance figures shown in this release.