The Russell 2000 (^RUT) is packed with potential breakout stocks, thanks to its focus on smaller companies with high growth potential. However, smaller size also means these businesses often lack the resilience and financial flexibility of large-cap firms, making careful selection crucial.
Picking the right small caps isn’t easy, and that’s exactly why StockStory exists - to help you focus on the best opportunities. Keeping that in mind, here is one Russell 2000 stock that could be a breakout winner and two that may struggle to keep up.
Two Stocks to Sell:
Hain Celestial (HAIN)
Market Cap: $113.2 million
Sold in over 75 countries around the world, Hain Celestial (NASDAQ:HAIN) is a natural and organic food company whose products range from snacks to teas to baby food.
Why Should You Sell HAIN?
- Absence of organic revenue growth over the past two years suggests it may have to lean into acquisitions to drive its expansion
- Sales were less profitable over the last three years as its earnings per share fell by 61.4% annually, worse than its revenue declines
- High net-debt-to-EBITDA ratio of 6× increases the risk of forced asset sales or dilutive financing if operational performance weakens
At $1.26 per share, Hain Celestial trades at 7.9x forward P/E. Check out our free in-depth research report to learn more about why HAIN doesn’t pass our bar.
Haemonetics (HAE)
Market Cap: $3.28 billion
With roots dating back to 1971 and a mission to improve blood-related healthcare, Haemonetics (NYSE:HAE) provides specialized medical devices and software for blood collection, processing, and management across plasma centers, blood banks, and hospitals.
Why Are We Wary of HAE?
- Core business is underperforming as its organic revenue has disappointed over the past two years, suggesting it might need acquisitions to stimulate growth
- Subscale operations are evident in its revenue base of $1.33 billion, meaning it has fewer distribution channels than its larger rivals
- Estimated sales growth of 1.4% for the next 12 months implies demand will slow from its two-year trend
Haemonetics is trading at $69.94 per share, or 13.7x forward P/E. If you’re considering HAE for your portfolio, see our FREE research report to learn more.
One Stock to Watch:
UMB Financial (UMBF)
Market Cap: $9.5 billion
With roots dating back to 1913 and a name derived from "United Missouri Bank," UMB Financial (NASDAQ:UMBF) is a financial holding company that provides banking, asset management, and fund services to commercial, institutional, and individual customers.
Why Do We Like UMBF?
- Market share has increased this cycle as its 17.8% annual net interest income growth over the last five years was exceptional
- Net interest margin jumped by 49 basis points (100 basis points = 1 percentage point) over the last two years, giving the firm more resources to pursue growth initiatives
- Incremental sales significantly boosted profitability as its annual earnings per share growth of 20.4% over the last five years outstripped its revenue performance
UMB Financial’s stock price of $125.14 implies a valuation ratio of 1.3x forward P/B. Is now the right time to buy? See for yourself in our comprehensive research report, it’s free.
Stocks We Like Even More
If your portfolio success hinges on just 4 stocks, your wealth is built on fragile ground. You have a small window to secure high-quality assets before the market widens and these prices disappear.
Don’t wait for the next volatility shock. Check out our Top 9 Market-Beating Stocks. This is a curated list of our High Quality stocks that have generated a market-beating return of 244% over the last five years (as of June 30, 2025).
Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,326% between June 2020 and June 2025) as well as under-the-radar businesses like the once-micro-cap company Tecnoglass (+1,754% five-year return). Find your next big winner with StockStory today.