Market Outlook - Small caps are expected to enter a favorable period after underperforming for the last couple of years, with revenue acceleration being a significant benefit [2] - The capital markets for both equity and debt are open, and M&A activity is robust, providing a positive environment for small caps [4] - The current cycle of rate cutting is anticipated to lead to increased liquidity in small caps as money market rates drop [6] Tariff Impact - Tariff concerns have been absorbed to some extent, but they still impact many companies, particularly smaller ones [3][4] - The China tariff remains a significant concern for many companies, highlighting the need for more certainty in the market [4] Investment Opportunities - Companies like Generac, Badger Meter, and Adran are highlighted as potential investment opportunities, with Generac's demand for backup generation in data centers being particularly notable [9][10] - Badger Meter is positioned well due to the ongoing infrastructure buildout, while Adran is expected to benefit from rural broadband investments [10] Market Dynamics - The outperformance of small caps is anticipated as liquidity tightens, leading to increased demand for shares in this segment [7] - Historical false starts in small caps have been noted, but recent market conditions suggest a potential shift [5]