The market has started to favor smaller companies in 2025, and stocks between $1 billion and $5 billion in market value are attracting renewed interest. These stocks had a forgettable stretch over the past few years, but investors now see evidence that underperformance among mid-cap and small-cap names could end soon.
The S&P MidCap 400 and S&P 600 indexes still trail large caps by a wide margin, yet smaller firms have held up well even as interest rates remain elevated. The valuation gap between these groups and the biggest names in the market has also widened to levels that analysts consider unusually attractive.
Investors now expect momentum to build for select companies in this sweet spot, and many of them are in fast-growing industries with strong fundamentals. Let’s look at the 15 standout names that have caught Wall Street’s attention so far in 2025.
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Methodology
For this article, I screened the top-performing stocks year-to-date in the $1 billion to $5 billion market capitalization bracket. Stocks that I have covered this week will be excluded from this list.
I will also mention the number of hedge fund investors for these stocks. Why are we interested in the stocks that hedge funds invest in? 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 275% since May 2014, beating its benchmark by 150 percentage points. (see more details here).
15. Schrodinger (NASDAQ:SDGR)
Number of Hedge Fund Holders In Q3 2024: 17
Schrodinger (NASDAQ:SDGR) is a software company that makes physics-based computational methods and helps with drug discovery.
The stock is up significantly this year due to the announcement of an expanded collaboration with Novartis that includes a $150 million upfront payment and the potential for up to $2.3 billion in milestone payments. Schrodinger could also get $150 million in the first quarter of 2025.
It has added new targets to its agreements with Otsuka and secured more funding from the Bill & Melinda Gates Foundation for predictive toxicology.
Total revenue for Q3 2024 came in at $35.3 million, and software revenue came in at $31 million. It lowered its drug discovery revenue forecast for 2024, but it has continued to report double-digit increases in subscription-based software revenue. Schrodinger’s operating expenses rose to $86.2 million, and it posted a net loss of $38.1 million.
The consensus price target on this stock is $28.5, implying 17% upside.
SDGR stock is up 19.3% year-to-date.
14. Centrus Energy (NYSEAMERICAN:LEU)
Number of Hedge Fund Holders In Q3 2024: 11
Centrus Energy (NYSEAMERICAN:LEU) supplies nuclear fuel for the nuclear power industry. The recent “Stargate” announcement by Trump is a major reason why these stocks have been spiking since AI models are going to need a lot of energy, and the sort of energy they need can’t be fully met by the current legacy power infrastructure. This company is the first in the U.S. to produce High-Assay Low-Enriched Uranium (HALEU).
Centrus Energy has landed several contracts with the Department of Energy (DOE), and the funding could reach billions. It also has a $3.8 billion backlog.
In Q3 2024, the company posted $57.7 million in revenue, though the net loss was $5 million. Last year, the company did achieve profitability. It posted a net income of $84.4 million and revenue of $320.2 million.
The current consensus price target by Wall Street sits at $106, implying 16% upside from here.
The stock is up 22.5% year-to-date.
13. LandBridge (NYSE:LB)
Number of Hedge Fund Holders In Q3 2024: 12
LandBridge (NYSE:LB) manages and then leases surface acreage, water rights, and other resources in the Delaware Basin. It then earns fees from easements, brackish water sales, produced water royalties, and oil and gas royalties on its acreage, and it has recently entered data center ventures.
The recent rise is due to a series of acquisitions and management’s higher guidance in Q4 2024. The company struck deals for about 53,080 acres in Lea County, New Mexico, and a big surface package called the Wolf Bone Rach. These transactions lifted its total surface ownership to 272,000 acres. EBITDA guidance was also reiterated at $170-$190 million, which surpassed earlier forecasts.
LandBridge now highlights more than 20% expected accretion to free cash flow per share in 2025 based on earlier deals. Q3 revenue rose 60% year-over-year and reached $28.5 million. Adjusted EBITDA was $25 million, up 62%. The company also pays a quarterly cash dividend of 10 cents per share since its IPO.
The four analysts’ price targets on the stock average $77.25 and imply a 3.5% downside.
LB stock is up 23.6% year-to-date.
12. VNET Group (NASDAQ:VNET)
Number of Hedge Fund Holders In Q3 2024: 13
VNET Group (NASDAQ:VNET) is a Chinese carrier-neutral internet data center services provider. It also offers hosting services and has colocation for servers.
The stock’s recent surge is due to the company aligning its strategy with the growing demand for AI-related infrastructure. It reported an 86.4% increase in wholesale data center revenues in Q3 2024 and also achieved a net profit of RMB 317.6 million. Adjusted EBITDA grew by 17.1%.
In addition, the company got multiple wholesale orders and expanded its power resources for data centers. That said, the company’s long-term potential seems challenging due to the debt burden here.
Analysts have a consensus price target of $6.74 for the stock. This implies 6% upside potential.
The stock is up 25.7% year-to-date.
11. Adaptive Biotechnologies (NASDAQ:ADPT)
Number of Hedge Fund Holders In Q3 2024: 19
Adaptive Biotechnologies (NASDAQ:ADPT) is a biotech company that makes immune medicine products. It focuses on Minimal Residual Disease (MRD) and Immune Medicine. The first is an FDA-cleared clonoSEQ test for cancer treatment response monitoring, and the second one uses immune receptor data for drug discovery and clinical trials.
The recent bullishness is due to the Centers for Medicare & Medicaid Services setting a favorable reimbursement rate of $2,007 for the company’s clonoSEQ test. It also announced a collaboration with NeoGenomics to expand access to MRD testing for blood cancer patients.
Adaptive also reported strong growth in its MRD business, with revenue growing 52% year-over-year in Q3 2024. The cost optimization focus also reduced its net loss by 36%.
The consensus price target of $8 implies 0.12% downside.
The stock is up 29.4% year-to-date.
10. AtriCure (NASDAQ:ATRC)
Number of Hedge Fund Holders In Q3 2024: 22
AtriCure (NASDAQ:ATRC) is a medical device company that sells products for atrial fibrillation (Afib), left atrial appendage management, and post-operative pain management.
The company has continued to expand its product offerings due to advancements like the cryoSPHERE MAX probe and exclusive licensing agreements for pulsed-field ablation (PFA) tech. PFA can treat Afib with fewer complications than other methods.
ATRC stock has seen a lot of bullishness due to the company expecting robust revenue growth of 17% for 2024. Revenue is expected to be $465.3 million, and 2025 revenue is expected to grow further to $517-527 million. It has also been successful in growing its international sales by 28% in Q4 2024, in addition to its strong U.S. performance. It projects an adjusted EBITDA of $40-$44 million for 2025.
Analysts have a consensus price target of $47.14 on the stock, which implies 19.34% upside potential.
The stock is up 29.9% year-to-date.
9. Camtek (NASDAQ:CAMT)
Number of Hedge Fund Holders In Q3 2024: 27
Camtek (NASDAQ:CAMT) provides inspection and metrology solutions for the semiconductor industry. It makes sensors, memory, RF, and more.
The company has been posting stellar demand for its products. It has secured over $50 million in initial orders for its Hawk product line. This product line features 3D measurement for High Bandwidth Memory (HBM), chiplets, and hybrid bonding. It also launched its fifth-gen Eagle system for better wafer throughput and optical resolution.
It reported Q3 2024 revenue at $112.3 million, up 40% year-over-year. It is also solidly profitable, with a GAAP operating margin of 26.4% and a non-GAAP net income of $37 million.
Analysts believe the rising demand for AI and HPC should continue to grow this company.
That said, the consensus analyst price target for the stock at $109 points to only 2.75% upside.
CAMT stock is up 31.2% year-to-date.
8. Symbotic (NASDAQ:SYM)
Number of Hedge Fund Holders In Q3 2024: 15
Symbotic (NASDAQ:SYM) makes robotics and software systems for warehouse and supply chain automation.
The stock has been rising significantly after Symbotic announced a major deal with Walmart. Symbotic will be acquiring Walmart’s Advanced Systems and Robotics business and deliver automation for hundreds of Walmart sites. This should boost Symbotic’s backlog by some $5 billion.
This acquisition is a way for Symbotic to expand its reach in micro-fulfillment setups and take advantage of Walmart’s store network.
Revenue growth is also drawing attention. Symbotic’s recent filings showed a 52% top-line increase to $1.79 billion and a 55% year-over-year jump in its fourth-quarter sales to $577 million. It now projects about 40% year-over-year sales growth for Q1 fiscal 2025.
Analysts have a consensus price target of $36.7, which points to 10.33% upside potential.
The stock is up 34.7% year-to-date.
7. Powell Industries (NASDAQ:POWL)
Number of Hedge Fund Holders In Q3 2024: 26
Powell Industries (NASDAQ:POWL) makes custom electrical power solutions, and some of these are used in data centers.
POWL stock has been surging this year due to stellar performance and upbeat guidance for 2025. Revenue jumped 45% year-over-year to $1 billion, and net income rose 175% to $150 million.
Gross margins have also improved, and the company is seeing a lot of demand in petrochemical and oil & gas markets. The data centers could also fuel huge demand down the line.
Powell Industries noted that its backlog is at $1.3 billion. The cash balance is at $358 million with no debt.
The analyst consensus price target of $312 implies flat upside.
The stock is up 36.12% year-to-date.
6. Clover Health Investments (NASDAQ:CLOV)
Number of Hedge Fund Holders In Q3 2024: 12
Clover Health Investments (NASDAQ:CLOV) is a healthcare company that focuses on Medicare Advantage plans in the U.S.
Clover Health Investments recently reported a 27% year-over-year growth in Medicare Advantage membership, which surpassed 100,000 members. The company’s flagship PPO plan also got an upgraded 4-star rating from the Centers for Medicare and Medicaid Services (CMS).
In addition, Q3 2024 financials showed a narrowing net loss to 2 cents per share compared to 9 cents a year earlier. Clover also saw a 9% increase in insurance revenue to $322.6 million and raised its full-year adjusted EBITDA guidance to $55-$65 million. The balance sheet is also strong due to a $287.9 million cash reserve and no long-term debt.
Analysts have a consensus price target of $4.35 for the stock.
CLOV is up 37.7% year-to-date.
5. Exodus Movement (NYSEAMERICAN:EXOD)
Number of Hedge Fund Holders In Q3 2024: N/A
Exodus Movement (NYSEAMERICAN:EXOD) is a fintech company. The company’s biggest product is a crypto wallet that can hold hundreds of cryptos and exchange between them.
It was uplisted last month from the OTCQX market to the NYSE American exchange. Moreover, the broader crypto market being bullish and Bitcoin surpassing $100,000 for the first time also heavily helped the stock climb up the charts.
Exodus also introduced a new swap feature this month that allows users to make faster and cheaper transactions. It reported a record exchange volume of $1.26 billion in Q4 2024 (October to November). It holds over 1,900 BTC and 2,660 ETH.
The pro-crypto views of Trump are also something you can thank for EXOD being on this list.
EXOD stock is up 42.76% year-to-date.
4. Vir Biotechnology (NASDAQ:VIR)
Number of Hedge Fund Holders In Q3 2024: 22
Vir Biotechnology (NASDAQ:VIR) is an immunology company that makes antibody platforms and T-cell engagers. The company focuses on chronic hepatitis delta, chronic hepatitis B, and HIV. It also has “masked” T-cell engagers in clinical trials for some solid tumors.
The recent rise was triggered by its positive early-stage clinical results in oncology. Vir Biotechnology announced in early January that it had encouraging outcomes from its dual-masked T-cell engagers in solid tumors and advanced prostate cancer. Analysts noted that Vir is now aiming to launch a Phase 3 program for its hepatitis delta treatment in the first half of this year and reported over $1.19 billion in cash.
Regardless, like most biotech startups, Vir Biotechnology recorded a net loss in Q3 2024, but the huge cash pile can fund development into mid-2027 despite the losses. Its 2025 consensus revenue estimate is at $33 million, and projected EPS is around -$2.8 for 2025.
The consensus analyst price target is $31.38, which implies 198% upside. However, you should keep in mind that this is biotech and over-the-top price targets are common here.
The stock is up 44.8% year-to-date.
3. Nuscale Power (NYSE:SMR)
Number of Hedge Fund Holders In Q3 2024: 18
Nuscale Power (NYSE:SMR) makes small modular reactors (SMRs). It has the first SMR design certified by the U.S. Nuclear Regulatory Commission (NRC). It is currently pre-revenue and is deeply unprofitable, but AI can quickly make it hot.
Trump’s “Stargate” announcement is going to significantly boost the power usage of AI, and analysts are looking at huge demand for nuclear energy going forward since legacy power generation capabilities will no longer be able to support the kind of demand we may see from AI.
Most nuclear-related stocks have been surging.
The stock is up 45% year-to-date. The current analyst consensus price target on the stock is $26, which implies just 1% upside potential.
2. Nano Nuclear Energy (NASDAQ:NNE)
Number of Hedge Fund Holders In Q3 2024: N/A
Nano Nuclear Energy (NASDAQ:NNE) is a nuclear energy company that focuses on smaller micro-reactors. They are making two prototype reactors: ZEUS and ODIN. The first one is a solid core battery reactor, and the latter is a low-pressure salt coolant reactor.
The stock has gained 54% year-to-date due to the company acquiring Ultra Safe Nuclear’s technology assets for $8.5 million. In addition, there was also news of a fusion breakthrough.
That said, the company still has negative net income and is yet to generate revenue. Analysts remain bullish, with the consensus price target at $58. This implies 57% more upside from here.
1. Oklo (NYSE:OKLO)
Number of Hedge Fund Holders In Q3 2024: N/A
Oklo (NYSE:OKLO) is a nuclear tech company. It makes small nuclear reactors known as fast reactors. It also offers nuclear fuel recycling, and the company’s Aurora powerhouse product line can supply 15 to 50 megawatts of electricity.
OKLO stock’s recent climb is due to growing enthusiasm for nuclear power and this is something that has spilled into most small reactor companies. Trump’s Stargate project will likely lead to a lot more funding for AI models, and this in turn should cause AI power usage to soar down the line. The problem is that legacy power generation can’t keep up with the demands of AI, so many see nuclear energy as the only way forward.
That said, Oklo is still pre-revenue and posted a notable net loss of $63.33 million for the first nine months of the current fiscal year.
The consensus price target of $28.5 implies 16.6% downside.
OKLO stock is up 56.4% year-to-date.
While we acknowledge the potential of OKLO as an investment, our conviction lies in the belief that some 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 OKLO but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
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Disclosure: None. This article was originally published at Insider Monkey.
