Group 1: Market Overview - Small-cap stocks have experienced a strong rally recently, driven by a favorable rate cut outlook which provides significant tailwinds [1][5] - The cheaper capital environment is particularly beneficial for smaller companies, contributing to their recent performance [1] Group 2: Company Insights - **Star Equity Holdings (STRR)**: This diversified holding company has seen its shares increase by 35% over the past three months, with the CEO acquiring approximately 660,000 shares in September [2][5] - **Anterix (ATEX)**: A wireless communications company focused on private broadband connectivity, the CEO purchased around 4,600 shares for $100,000 in mid-September. Despite recent pressure, shares have shown some recovery from 2025 lows [3][5] - **Energy Vault (NRGV)**: This company specializes in sustainable energy storage solutions. The CEO made a significant purchase of about 67,500 shares, with NRGV shares more than tripling in the last three months, outperforming the S&P 500's 12% gain [6][5] Group 3: Insider Activity - Recent insider buying activity from the CEOs of STRR, ATEX, and NRGV is seen as a positive indicator for long-term outlooks, although these transactions should not be solely relied upon for short-term performance [7][5]

Core Insights - Since early August, the Russell 2000 has outperformed the S&P 500 [1] Group 1 - The Russell 2000 index, which represents small-cap stocks, has shown stronger performance compared to the large-cap S&P 500 index [1]

Group 1: Small-Cap Market Momentum - The small-cap space has shown momentum recently, with the iShares Russell 2000 ETF (IWM) gaining nearly 3% over the past week, outperforming the broad market fund (SPY) which gained 1% [1] - Anticipated Fed rate cuts are contributing to this momentum, with futures markets pricing in a 94% chance of a quarter-point cut at the next Fed meeting, up from 85% before the latest inflation data [2] - Small-cap companies, which typically have a higher debt burden at floating rates, will benefit from lower borrowing costs, aiding their expansion and profitability [3] Group 2: Valuation and Investment Opportunities - The Russell 2000 has underperformed the S&P 500 year-to-date, with a gain of just 1.5% compared to 9.6%, potentially providing an advantageous entry point for investors [4] - Small-caps are currently trading at a discount compared to large-caps, attracting institutional investors who are rotating out of crowded mega-cap trades into undervalued small-cap segments [5] Group 3: Business Sentiment and Economic Indicators - Optimism among small business owners increased in July, with the small business optimism index rising to 100.3, the highest since February and above the 52-year average of 98, indicating a stabilizing business environment [6] - Trends in reshoring and onshoring favor small-cap firms, as companies bring supply chains back to the U.S. amid global supply chain vulnerabilities [7] Group 4: M&A Activity and Market Dynamics - Dealmaking is increasing in sectors like healthcare, biotech, and tech services, with large-cap companies targeting small and mid-sized firms for growth, which historically favors small companies [8] - The broadening market breadth, where gains are spreading more evenly across the market, signals healthier market dynamics and could catalyze small-cap outperformance [10] Group 5: Investment Vehicles - Several ETFs in the small-cap space have a strong Zacks ETF Rank 1 (Strong Buy) or 2 (Buy), indicating potential outperformance in the coming weeks, including iShares Core S&P Small-Cap ETF (IJR) and Vanguard Small-Cap ETF (VB) [11]

Market Trends - Expectations are rising for an interest rate cut due to the latest inflation data [1] - Speculative meme stocks and small-cap stocks are expected to remain popular [1]

Wealth anchor Brad Smith breaks down the latest financial news for June 11, 2025. Alger Executive Vice President and Portfolio Manager Amy Zhang discusses how to play the small and mid-cap stock trades and why she believes there are opportunities here. Food prices rose in May. Stew Leonard's CEO joins Brad to discuss how to save money on groceries this summer. Author and student loan expert Mark Kantrowitz speaks with Brad about how President Trump's "Big, Beautiful" tax and spending bill could impact stude ...

Market Overview - The Russell 2000 index, a benchmark for small-cap stocks, has increased by approximately 3.8% this week and 15.7% over the past month, indicating strong momentum in the small-cap sector [1] Interest Rates and Tariffs - Small-cap stocks are sensitive to interest rates, as many rely on debt for operations, making it challenging to absorb higher tariff charges. Interest rates may not decrease as quickly as anticipated, and while progress in U.S.-China tariff negotiations is noted, a finalized agreement is still pending [2] Volatility and Investment Opportunities - Investors should prepare for increased volatility in the next 90 days, but several small-cap stocks mentioned have strong investment potential regardless of tariff and interest rate fluctuations [3] Advance Auto Parts (AAP) - AAP has a 12-month stock price forecast of $45.13, representing a potential upside of 31.10% from its current price of $34.42. Analysts suggest a consensus Hold rating based on 17 ratings [4][5] - The stock is trading near its 52-week low but has risen over 5% in the past week, with a high short interest of over 17%, indicating potential for a short squeeze [6] - AAP's turnaround plan, including closing underperforming stores, is showing positive results, particularly in improving its balance sheet [7] La-Z-Boy (LZB) - LZB has a 12-month stock price forecast of $44.50, indicating a modest upside of 1.00% from its current price of $44.06. The stock has seen a 20% increase this year, partly due to its "Made in America" positioning [9][11] - The company is relatively insulated from tariffs, with much of its production in the U.S., although one-third of its products are still exposed to China [10] - LZB's stock is trading at around 14.9x earnings, which is considered somewhat expensive, but it has recently received an upgrade from KeyCorp with a price target of $46 [11] National Vision Holdings (EYE) - EYE has a 12-month stock price forecast of $17.57, suggesting a downside of 5.53% from its current price of $18.60. The stock was recently upgraded to a Buy from Underperform by Bank of America, with a new price target of $22 [12][13] - The company is implementing a strategic plan that includes price increases of 10% to 15%, which consumers have not resisted so far. However, it anticipates increased costs of $10 to $15 million due to its exposure to China [14] - Following the upgrade, EYE's stock has risen over 50%, prompting a cautionary note for investors to consider waiting for a pullback before investing [15]