These 3 Micro-Cap Stocks Are Making A Buzz

Friday, June 11, 2021 | Thomas Hughes
These 3 Micro-Cap Stocks Are Making A Buzz

Put These Three Micro-Cap Stocks On Your Watchlist

Micro-cap stock Investing isn't for everyone. While micro-cap stocks often offer a discounted entry into many sectors, the stocks also come with outsized risk compared to their larger-cap brethren. But, like they say, with risk comes reward. The trick is finding the right micro-cap stocks to invest in. One place to start is the Russell Microcap Index and, more specifically,  stocks in the lower half of the list. Those are the ones we consider to be up-and-comers in the micro-cap world. The Russell Microcap Index is an index of the smallest 1000 companies in the Russell 2000 Index plus the next thousand smallest companies eligible for inclusion. Today, we're going to take a look at 3 micro-cap stocks that are about to be included in the annual Russell micro-cap index rebalancing.

Broadwind Is A Play On Infrastructure And Clean, Green Energy

Broadwind, Inc. (NASDAQ: BWEN) manufactures and markets equipment and components for cleantech and other specialized applications in the United States. It operates through three segments That give it exposure to onshore and offshore fracking and drilling, wind energy, steel production, Natural Gas, Material Handling, and other infrastructure applications. The company was not immune to the pandemic due to its exposure to carbon-based energy and industry in general but the outlook is rapidly changing. Not only is the economic reopening spurring activity in all end markets but the company is well-positioned to benefit from infrastructure spending and the shift to green energy.

Shares of the stock began putting in a bottom following the most recent quarterly earnings report and begin moving higher shortly before the announcement for Russell index inclusion. Now the stock is testing for support at the short-term moving average. Assuming support is confirmed, we expect to see price action began trending higher very soon. We think the stock will test the $6 and $7 levels within the next  4 to 8 weeks and possibly move higher if resistance at $7 can be surpassed. As a point of note, inclusion in the Russell Microcap Index begins with the market opening on June 28th. 

These Three Micro-Cap Stocks Are Making A Buzz

Wireless Telecom Boosted By The Global Telecom Industry 

Wireless Telecom (NYSEAMERICAN: WTT) manufactures a wide range of RF and microwave communication technology and services clients in the telecom, government, aerospace, med-tech, and satellite Industries among others. This company, unlike Broadwind, produced a substantial revenue gain in the most recently reported quarter and internal metrics suggest revenue acceleration will continue. The net consolidated revenue of $11.3 million is up 19.8% year-over-year and beat the consensus by 1000 basis points. Perhaps more importantly, the company produced an adjusted EBITDA of $671,000 compared to a net loss of $308,000 in the same period last year. As for the outlook, the company said it received new customer orders of $12.8 million which brings the book-to-bill ratio to a strong 1.13. In terms of backlog, the backlog increased more than 100% to $10 million dollars.

Shares of this stock began moving up off of strong support shortly after the release of Q1 earnings. Now, following the inclusion announcement, the stock appears ready to move higher. Once the price action gets above $1.90 we expect to see a move up to $2 and then $2.10 by the end of the month. A move above $2.10 would be incredibly bullish and bring targets in the range of $2.70 into play.

These Three Micro-Cap Stocks Are Making A Buzz

NetSol Technologies Is A Going Concern In Fintech

NetSol Technology (NASDAQ: NTWK) offers a suite of applications for businesses operating in the leasing and financing industry. The company's products and SaaS solutions span tech from the desktop to the cloud and are used by many of the world's largest corporations. The company just reported the third straight quarter of sequential revenue increases driven by new client acquisition, renewals, and robust growth in the higher-margin SaaS and Cloud businesses. More importantly, the company says it's made important inroads within North America and Europe that they expect will lead to future sales in expansion markets.

Shares of NetSol began moving higher shortly after releasing the Q3 report. The move confirms support at the $4 level and it appears that shares are ready to move higher. The inclusion announcement has the stock up more than 1% And extending gains made earlier in the week. Price action may be choppy in the near term but it appears support is strong and getting stronger in the range of $4.50 to $5. A move above the $5.25 range would be significant and likely lead to a retest of the recently set high.

These Three Micro-Cap Stocks Are Making A Buzz

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7 Stocks to Watch When Student Debt Forgiveness Gets Passed

Now that the Biden administration is fully in charge, student debt forgiveness has moved to the front burner. Consider these numbers. There is an estimated $1.7 trillion in student debt. The average student carries approximately $30,000 in student loans.

If $10,000 of student debt were to be canceled, there are estimates that one-third of borrowers (between 15 million to 16.3 million) would become debt-free. Of course, if the number hits $50,000 as some lawmakers are suggesting the impact would even greater.

Putting aside personal thoughts on the wisdom of pursuing this path, it has the potential to unleash a substantial stimulus into the economy.

And as an investor, it’s fair to ask where that money would go. After all, there’s no harm in having investors profit from this stimulus as well.

A counter-argument is that the absence of one monthly payment may not provide enough money to make an impact. However, Senator Elizabeth Warren referred to the effect student loans have in preventing many in the millennial and Gen-Z generations from pursuing big picture life goals such as buying a house, starting a business, or starting a family.

With that in mind, we’ve put together this special presentation that looks at 7 stocks that are likely to benefit if borrowers are set free from the burden of student loans.

View the "7 Stocks to Watch When Student Debt Forgiveness Gets Passed".


Companies Mentioned in This Article

CompanyMarketRank™Current PricePrice ChangeDividend YieldP/E RatioConsensus RatingConsensus Price Target
NetSol Technologies (NTWK)0.8$4.88flatN/A54.22N/AN/A
Broadwind (BWEN)1.7$4.46flatN/A-20.27Buy$6.67
Wireless Telecom Group (WTT)1.1$2.20flatN/A-6.67Buy$2.75
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