Get alerts: ProShares UltraPro Short QQQ, Cadence Bank, and Applied Digital are the three Mid Cap stocks to watch today, according to MarketBeat’s stock screener tool. Mid-cap stocks are shares of publicly traded companies with a market capitalization typically in the range of about $2 billion to $10 billion, though exact cutoffs vary by index provider. Investors view them as a middle ground between large- and small-cap firms, offering more growth potential than large caps but typically less volatility an ...

Core Viewpoint - The Federal Reserve's transition from aggressive rate hikes to rate cuts is expected to benefit mid-cap stocks, potentially unlocking gains for companies that have demonstrated resilience in a tighter monetary environment [1][2]. Mid-Cap Growth Stocks - Mid-cap growth stocks are entering a new phase after experiencing one of the most aggressive rate-hike cycles in recent history, with the Fed's rate cuts positioning them to benefit more than other market segments due to their growth characteristics and attractive valuation multiples [2]. - These stocks are considered "long duration" assets, making their valuations sensitive to interest rate changes; as rates decline, the discount rate on future earnings decreases, enhancing stock prices [3]. M&A Activity - Lower borrowing costs are likely to stimulate merger and acquisition (M&A) activity, with mid-cap companies being in a favorable position as they are large enough to attract acquirers but small enough to be manageable targets for larger buyers [4][5]. - The combination of cheaper capital and lower valuations relative to large-cap stocks creates a conducive environment for increased deal activity, as mid-caps have historically been prime acquisition targets during periods of lower rates [5]. Investment Strategy - Not all mid-cap companies will benefit equally; emphasis should be placed on those with high financial quality, solid balance sheets, and strong cash flow generation that have shown resilience during the tightening cycle [6]. - The Alger Mid Cap 40 ETF (FRTY) focuses on approximately 40 holdings selected through fundamental research, targeting companies with proven operating histories and competitive positions rather than speculative firms [7]. AI Adoption Opportunities - While large-cap technology and AI infrastructure investments have garnered significant attention, there are opportunities among mid-sized "AI Adopters" that utilize artificial intelligence to enhance margins or accelerate revenue growth, often overlooked by Wall Street [8]. Market Dynamics - The mid-cap opportunity reflects a historical investor preference for a "barbell" approach, favoring large-cap stocks and small-cap speculation while neglecting mid-caps, which are currently trading at a historically wide discount of 28% based on price-to-earnings ratios as of December 31, 2025 [9].

Core Insights - The article discusses the potential of mid-cap stocks as attractive investment opportunities, particularly in the context of the "America First" agenda which aims to boost domestic manufacturing [2][3]. Industry Overview - The U.S. stock market is experiencing a shift with a growing interest in mid-cap stocks, which are expected to benefit from domestic revenue generation [2]. - Historically, mid-cap equities have outperformed both large-cap and small-cap stocks, although they have lagged behind large caps in the current year [3]. Hedge Fund Activity - Hedge funds are reportedly rotating out of large-cap stocks, with significant reductions in exposure to mega-cap stocks noted in Q3 2025 [4]. - Major hedge funds, such as Bridgewater Associates, have cut holdings in prominent stocks while increasing investments in mid-cap companies [4]. Methodology for Stock Selection - The article outlines a methodology for selecting high-growth mid-cap stocks, focusing on companies with market capitalizations between $2 billion and $10 billion and at least 30% revenue growth over five years [6]. Featured High-Growth Mid-Cap Stocks - **LifeStance Health Group, Inc. (NASDAQ:LFST)** - Market Capitalization: $2.82 billion - Revenue Growth (5Y): 36.75% - Analysts have raised price targets for LFST, indicating a positive outlook despite industry challenges [9][10][11][12]. - **Veracyte, Inc. (NASDAQ:VCYT)** - Market Capitalization: $3.29 billion - Revenue Growth (5Y): 34.46% - The company forecasts sales of $570 million to $582 million in 2026, exceeding consensus estimates [13][14][15]. - **Kinsale Capital Group, Inc. (NYSE:KNSL)** - Market Capitalization: $9.28 billion - Revenue Growth (5Y): 34.25% - Analysts have mixed views, with one firm initiating coverage with an Overweight rating while another lowered its price target due to anticipated near-term declines [16][17][18][19].

Group 1 - Mid-cap stocks are characterized as companies that have successfully navigated the startup phase and possess the potential for significant growth [1]

Company Overview - A. O. Smith Corporation (AOS) has a market cap of $9.6 billion and is a global manufacturer of water heating and treatment products, serving various sectors including residential, commercial, and industrial applications across North America, China, Europe, and India [1] - The company operates under well-known brands such as A. O. Smith, State, Lochinvar, and Aquasana, utilizing wholesale, retail, and e-commerce channels for product distribution [2] Stock Performance - AOS shares have declined nearly 11% from their 52-week high of $77.31, and over the past three months, the stock has decreased by 6.1%, underperforming the Dow Jones Industrials Average, which rose by 5.5% during the same period [3] - Year-to-date, AOS stock is up marginally, lagging behind the Dow Jones Industrials Average's gain of 13.8%, and has dipped 5.1% over the past 52 weeks compared to the Dow's 10.5% increase [4] Financial Performance - In Q3 2025, AOS reported earnings per share (EPS) of $0.94 and revenue of $942.5 million, exceeding expectations; however, shares fell by 2.6% following the announcement due to a lowered full-year outlook [5] - The company revised its sales guidance to flat to up 1% and narrowed EPS guidance to $3.70 - $3.85, attributing the adjustments to economic weakness in China, where sales declined by 12% in local currency, and a slowdown in new home construction in North America [5] Competitive Landscape - A. O. Smith's rival, GE Vernova Inc. (GEV), has significantly outperformed AOS, with GEV stock surging 107.1% year-to-date and 105.2% over the past 52 weeks [6] - Despite AOS's underperformance, analysts maintain a moderately optimistic outlook, with a consensus rating of "Moderate Buy" from 13 analysts and a mean price target of $78.50, indicating a potential upside of 14.1% from current levels [6]

Core Insights - U.S. stock markets are experiencing a significant bull run in 2023, with major indexes near all-time highs [1] - Small-cap and mid-cap benchmarks have shown notable gains, with Russell 2000 up 14.3% and S&P 400 up 7.6% year to date [2] - Mid-cap stocks are seen as a good diversification strategy, combining benefits of both small and large-cap stocks [2][3] Mid-Cap Stocks Overview - Top-ranked mid-cap stocks have high potential for profitability and market share growth, with less exposure to international risks compared to large caps [3] - In a thriving economy, mid-cap stocks are expected to outperform small caps due to established management and access to capital [4] Recommended Mid-Cap Stocks - Five mid-cap stocks with favorable Zacks Ranks for 2026 are FirstCash Holdings Inc. (FCFS), Lyft Inc. (LYFT), Installed Building Products Inc. (IBP), Lumen Technologies Inc. (LUMN), and Advanced Energy Industries Inc. (AEIS) [5][9] - Each stock carries a Zacks Rank of 1 (Strong Buy) or 2 (Buy) [5] Company-Specific Insights FirstCash Holdings Inc. (FCFS) - Operates pawn stores and payment solutions in the U.S. and Latin America, with expected revenue and earnings growth rates of 5.7% and 21.8% respectively for next year [8][10] Lyft Inc. (LYFT) - Engages in ridesharing in the U.S. and Canada, with expected revenue and earnings growth rates of 14.6% and 25.9% respectively for next year [11][13] - Aims to enter the robotaxi market through partnerships, avoiding high R&D costs [12] Installed Building Products Inc. (IBP) - Operates as a residential insulation installer, with expected revenue and earnings growth rates of 1.1% and 0.1% respectively for next year [14][15] Lumen Technologies Inc. (LUMN) - Focused on AI opportunities, with $10 billion in Private Connectivity Fabric deals and plans to eliminate $1 billion in costs [16][17] - Expected revenue and earnings growth rates of -5.2% and -71.9% respectively for next year [18] Advanced Energy Industries Inc. (AEIS) - Benefits from semiconductor and data center demand, with expected revenue growth of approximately 20% and earnings growth of 20.2% for next year [19][20][21]

Core Viewpoint - Lamb Weston Holdings, Inc. is a mid-cap food company with a market cap of $8.3 billion, specializing in frozen potato products and serving various sectors including restaurants and foodservice institutions [1][2]. Financial Performance - For Q1 2026, Lamb Weston reported an adjusted EPS of $0.74 and net sales of $1.66 billion, exceeding estimates [5]. - The company experienced a 6% volume growth, improved cost savings, and lower SG&A expenses, leading to a positive full-year outlook with projected net sales of $6.35 billion to $6.55 billion and adjusted EBITDA of $1 billion to $1.20 billion [5]. Stock Performance - Lamb Weston shares have decreased by 28.1% from their 52-week high of $83.98 and are down 9.6% year-to-date, underperforming the Consumer Staples Select Sector SPDR Fund (XLP), which has risen by 1.4% [3][4]. - Over the past 52 weeks, Lamb Weston shares have declined by 23.8%, while XLP has only dropped by 2.9% [4]. - Despite the stock's recent performance, it has risen by 7.7% over the past three months, outperforming XLP's marginal gain [3]. Analyst Sentiment - Analysts maintain a moderately optimistic outlook for Lamb Weston, with a consensus rating of "Moderate Buy" from 12 analysts and a mean price target of $65.27, indicating an 8.6% premium to current levels [6].

Company Overview - DaVita Inc. (DVA) has a market capitalization of $8.6 billion and is a leading provider of kidney dialysis services in the United States, operating a nationwide network of outpatient dialysis centers [1] - The company offers a range of services including outpatient, inpatient, and home-based hemodialysis, as well as related laboratory testing for patients with end-stage renal disease (ESRD) [1][2] Financial Performance - DVA shares have decreased 32.4% from their 52-week high of $179.60 and have dropped 8.9% over the past three months, underperforming the Dow Jones Industrials Average, which rose by 5.7% in the same period [3] - Year-to-date, DVA stock has dipped 18.9%, while the Dow Jones has gained 13.9% [4] - Over the past 52 weeks, DVA shares have declined 21.2%, compared to a 10.4% return for the Dow Jones [4] - Following the Q3 2025 results released on October 29, DVA shares tumbled 6.2%, reporting an adjusted EPS of $2.51, which was below analyst estimates [5] - The decline in earnings was attributed to higher patient care costs, which rose nearly 6% year-over-year to $271.23 per treatment, increased general and administrative expenses of $322 million, and lower dialysis volumes [5] Operational Challenges - Investor sentiment has been negatively impacted by an April ransomware attack that cost the company $11.7 million and disrupted operations [6] - DVA has underperformed compared to its rival HCA Healthcare, Inc. (HCA), which has seen its stock climb 60.4% year-to-date and 53.4% over the past year [6] Analyst Sentiment - Analysts are cautious about DVA's prospects, with a consensus rating of "Hold" among the eight analysts covering the stock [7] - The mean price target for DVA is $143, indicating a potential premium of 17.8% to current levels [7]

Company Overview - Pool Corporation, based in Covington, Louisiana, is the world's leading independent distributor of swimming pool supplies, equipment, and related leisure products, with a market cap of $8.9 billion and operations in hundreds of locations serving over 125,000 wholesale customers globally [1]. Market Position - Pool Corporation is classified as a mid-cap stock, fitting the description of companies valued between $2 billion and $10 billion, with extensive operations across the U.S., Canada, Mexico, Europe, and Australia [2]. Stock Performance - Pool's stock has experienced a significant decline, with prices dropping 35.9% from its 52-week high of $374.74 on March 10, and a 26.3% decrease over the past three months, underperforming the Industrial Select Sector SPDR Fund's (XLI) 3.4% increase during the same period [3]. - Year-to-date, Pool's stock has fallen 29.5%, and over the past 52 weeks, it has decreased by 35%, contrasting with XLI's 19% surge in 2025 and 13.8% returns over the past year [4]. Recent Financial Results - Following the release of better-than-expected Q3 results on October 23, Pool's stock saw a slight uptick, maintaining momentum from Q2 with top-line growth and margin expansion [5]. - For Q3, Pool's revenue increased by 1.3% year-over-year to approximately $1.5 billion, surpassing market expectations by 14 basis points, while adjusted EPS rose 4% year-over-year to $3.39, exceeding consensus estimates by 30 basis points [6]. Competitive Analysis - Compared to its peer Leslie's, Inc., which saw a 94.6% decline in 2025 and a 95.1% drop over the past 52 weeks, Pool has notably outperformed [7]. - Among 15 analysts covering Pool stock, the consensus rating is a "Moderate Buy," with a mean price target of $329.27, indicating a potential upside of 37% from current price levels [7].

Company Overview - Molina Healthcare, Inc. (MOH) has a market cap of $8.7 billion and provides managed healthcare services to low-income individuals and families through Medicaid, Medicare, and state insurance marketplace programs [1] - The company operates in four key segments: Medicaid, Medicare, Marketplace, and Other [1] Stock Performance - MOH shares have dropped 55.4% from their 52-week high of $359.97 and decreased 10.4% over the past three months, underperforming the Dow Jones Industrials Average, which rose by 5.6% during the same period [2] - Year-to-date, MOH stock is down 44.9%, lagging behind the Dow's nearly 13% gain, and has dipped 46.2% over the past 52 weeks compared to the Dow's 8.6% increase [3] Recent Financial Results - Following the Q3 2025 results on October 22, MOH shares tumbled 17.5% as adjusted EPS fell to $1.84 from $6.01 due to elevated medical costs, with about half of the underperformance attributed to the Marketplace segment [4] - The company has revised its full-year 2025 adjusted profit forecast to approximately $14 per share, citing ongoing pressure from higher-than-expected healthcare utilization, particularly in Medicare and Marketplace plans [4] Competitive Landscape - In comparison, rival CVS Health Corporation (CVS) has significantly outperformed MOH, with CVS stock surging 75.9% year-to-date and 43.2% over the past 52 weeks [5] - Analysts remain cautious about MOH's prospects, with a consensus rating of "Hold" from 18 analysts and a mean price target of $170, representing a 5.9% premium to current levels [5]