The Russell Microcap Index, a market cap-weighted equity index maintained by FTSE Russell, is designed to track the performance of the smallest 1,000 companies in the small-cap Russell 2000 Index (RUT), along with the next thousand smallest eligible securities.
Last month, FTSE Russell, the leading global index provider, posted its preliminary lists of companies set to join the Russell Microcap Index as part of its 36th annual Russell US Indexes Reconstitution. The annual Russell rebalancing is typically a high-volume event, with new index additions drawing increased volume from index and fund managers looking to track the performance of the various associated benchmarks.
Ahead of this event, here are five microcap stocks that have been named as new additions to the index this summer. Plus, adding to their appeal is a seal of approval from Wall Street analysts, with significant upside to their mean price targets.
Stock #1: Hut 8 Corp.
With a market cap of around $864.1 million, Florida-based Hut 8 Corp. (HUT) is a North American energy infrastructure operator and Bitcoin (BTCUSD) miner.
The company's diverse portfolio encompasses nine Bitcoin mining, hosting, and managed services sites across Alberta, New York, Nebraska, and Texas, along with five high-performance computing data centers in British Columbia and Ontario.
Shares of Hut are down 24.7% YTD, though they’ve surged 33.5% over the past three months.
Analysts have a consensus rating of “Moderate Buy” on Hut stock, with a mean target price of $12.25, which indicates upside potential of about 22% from current levels. Out of six analysts covering the stock, three advise a “Strong Buy” rating, two suggest a “Moderate Buy,” and the remaining one gives a “Strong Sell” rating.
Stock #2: Ur-Energy
Valued at a market cap of about $461.9 million, Colorado-based Ur-Energy Inc. (URG) specializes in identifying, acquiring, developing, developing, and operating uranium projects.
Ur-Energy's Wyoming properties encompass approximately 48,000 acres of mineral property rights, including the operational Lost Creek Property in the Great Divide Basin, which has been producing uranium since 2013, and the Shirley Basin Project, which is construction-ready with all major permits and licenses secured.
URG shares have rallied 48.6% over the past 52 weeks, and are currently down about 20% from highs.
Analysts are optimistic about Ur-Energy stock's prospects, with a unanimous “Strong Buy” rating from the four analysts in coverage. The mean target price of $2.60 indicates an impressive potential upside of about 63.5% from the current price levels.
Stock #3: Intuitive Machines
Founded in 2013, Texas-based Intuitive Machines, Inc. (LUNR) is dedicated to advancing space exploration. Valued at $263.2 million by market cap, the company provides a range of space products and services designed to support ongoing robotic and human missions to the moon, Mars, and beyond, including its historic Odysseus landing in February.
Shares of this space exploration company have soared 84.3% on a YTD basis, even as LUNR has cooled off about 64% from its February highs.
Overall, analysts are highly bullish on Intuitive Machines stock, with a unanimous “Strong Buy” rating from the four analysts offering recommendations for the stock. Plus, the mean target price of $10.25 indicates a remarkable upside potential of 117.6% from current levels.
Stock #4: Inovio Pharmaceuticals
Headquartered in Pennsylvania, Inovio Pharmaceuticals, Inc. (INO) is a clinical-stage biotechnology company specializing in developing DNA medicines to address HPV-related diseases, cancer, and infectious diseases.
The company’s investigational CELLECTRA delivery devices ensure that its DNA medicines effectively enter the body’s cells for optimal therapeutic impact.
Inovio’s market cap currently stands at $261.4 million. The biotech company’s shares are up 65.5% on a YTD basis and 113.6% over the past six months.
Inovio stock has a consensus "Moderate Buy" rating overall. Out of six analysts covering Inovio, three recommend a "Strong Buy," and the remaining three give a "Hold" rating. The mean price target of $17.92 implies a potential upside of 76.9% from the current price levels.
Stock #5: Airship AI Holdings
Established in 2006, Washington-based technology company Airship AI Holdings, Inc. (AISP) specializes in artificial intelligence (AI)-driven video, sensor, and data management surveillance platforms. It aims to enhance public safety and operational efficiency for both public sector and commercial clients.
Valued at a market cap of $82.7 million, the company’s product suite includes the Outpost AI edge hardware and software, the Acropolis enterprise management software stack, and the Command family of visualization tools.
Shares of Airship AI went public via a SPAC merger in December 2023, and have now rallied 100% on a YTD basis - even following a sharp 76% pullback from their March highs.
Airship AI has a “Strong Buy” rating from the one analyst in coverage, with the price target of $12 implying a whopping 236.1% upside potential.
On the date of publication, Anushka Mukherji did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
