We recently published a list of 12 Best Nasdaq Stocks Under $20 to Buy Now. In this article, we are going to take a look at where AvePoint Inc. (NASDAQ:AVPT) stands against other best Nasdaq stocks under $20 to buy now.

The Nasdaq has had a challenging start to 2025, with the index dropping nearly 12% YTD, as of March 13. March 10 marked its worst single-day decline in almost two years, plunging 4% as investor concerns over escalating trade tensions fuelled fears of a potential U.S. recession. Given that technology companies make up approximately 60% of the Nasdaq, the sector’s heightened volatility has played a significant role in the index’s decline. Consumer discretionary stocks, the second-largest sector in the Nasdaq, account for roughly 20% of its total weight. This heavy concentration in growth-driven industries makes the Nasdaq a key indicator of the performance of both the technology sector and high-growth stocks.

A closer look at sector exposure provides further insight into recent market movements. On March 7, Reuters cited a Goldman Sachs report highlighting that hedge funds specializing in stock picking and multi-strategy investing saw nearly half of their annual gains erased in a single day following a tech-driven selloff on March 6. The most significant declines were concentrated in sectors where hedge funds had high exposure, including technology, media, and telecommunications. Year-to-date, the technology sector has been the second-worst performer in the S&P 500, falling 8%, while consumer discretionary stocks have led declines with a drop of over 9%.

Market volatility is likely to persist as economic indicators continue to send mixed signals. Treasury Secretary Scott Bessent recently stated that the U.S. economy may undergo a “detox period” as the new administration implements government spending cuts. However, he later clarified that a recession is not an inevitable outcome. With policy changes creating uncertainty, market turbulence could remain a recurring theme.

John Belton, a portfolio manager for growth equities at Gabelli Funds, shared his perspective on Nasdaq’s recent volatility during an appearance on CNBC’s ‘The Exchange’. He described the current market sentiment as a “buyers’ strike,” driven by uncertainty over policy direction from the White House. According to Belton, Wall Street is hesitant to take on additional risk in such an unpredictable environment. Despite the recent downturn, he emphasized that the fundamentals of major mega-cap technology companies remain strong. He also noted that Nasdaq’s exceptional performance in the past two years—gaining over 40% in 2023 and more than 30% in 2024—set high expectations among investors. The current correction, he suggests, is a natural reaction to those lofty expectations, coupled with the transition in political leadership.

While Nasdaq has delivered impressive returns in recent years and remains home to some of the world’s leading technology giants, it also presents compelling opportunities beyond large-cap tech. Investors looking for promising yet lower-priced stocks, particularly those trading under $20, may find attractive options within the index. These stocks often belong to companies with significant growth potential, making them appealing to both institutional and retail investors seeking high-upside investments at a relatively affordable price point.

Our Methodology

To determine the 12 best Nasdaq stocks under $20 to buy, we conducted a screening for Nasdaq-listed companies with a share price below $20 and a market capitalization exceeding $2 billion. We applied an additional criterion, considering only those stocks with an expected upside of at least 10%. Finally, we ranked the top 12 stocks that were the most widely held by hedge funds in ascending order of hedge fund holders, based on data from Insider Monkey’s Q4 2024 database of hedge funds.

Note: All pricing data is as of market close on March 13.

Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 373.4% since May 2014, beating its benchmark by 218 percentage points (see more details here).

AvePoint Inc. (NASDAQ:AVPT)

Current market price: $13.79

Upside Potential: 34%

Number of Hedge Fund Holders: 40

AvePoint Inc. (NASDAQ:AVPT) is a leading provider of cloud-based data management solutions, specializing in SaaS applications for Microsoft 365, SharePoint, and other enterprise collaboration platforms. Its software helps organizations manage data security, compliance, and migration in cloud environments.

In its February Investor Presentation, AvePoint Inc. (NASDAQ:AVPT) highlighted a large addressable market of $80.4 billion in 2024, which is expected to grow to $136.5 billion by 2028, at a compounded annual growth rate of over 14%. Apart from a stronger topline growth, the company is focussing on improving its operating margin to 20%-25% over the long-term, from the current ~14% level.

While Citi analyst Fatima Boolani reduced AvePoint Inc.’s (NASDAQ:AVPT) price target from $18 to $16 and maintained a Neutral rating, she remained positive about the company’s prospects. The analyst noted that the company’s investor day provided greater clarity on its upcoming Singapore dual-listing, which could serve as a distinctive catalyst for attracting more institutional investors. Her cautious stance stemmed from the intensifying competition in the space, while the price target adjustment reflected her updated earnings estimates.

Overall, AVPT ranks 10th on our list of best Nasdaq stocks under $20 to buy now. While we acknowledge the potential of AVPT to grow, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than AVPT but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.

READ NEXT: 20 Best AI Stocks To Buy Now and 30 Best Stocks to Buy Now According to Billionaires

Disclosure: None. This article is originally published at Insider Monkey.