5 S&P 500 small-cap stocks to explore during a downturn

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5 S&P 500 small-cap stocks to explore during a downturn

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 5 S&P 500 small-cap stocks to explore during a downturn
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Highlights:

  • Sonic (NYSE: SAH) has a market cap of US$ 2.13 billion.
  • Addus HomeCare posted Q2 2022 revenues of US$ 236.9 million.
  • Green Plains Inc.’s shares rose 6.37 on a yearly basis. 

The US stock market became extremely volatile in 2022, and investing has become difficult, with Wall Street going through a roller coaster ride. Tech stocks had their biggest rout this year, and retail giants saw their shares fall steeply.

Although small-cap stocks have greater risks in a bearish market, they also have the potential to give higher returns to investors who hold on to them for the long term.

That said, we explore five small-cap stocks curated by Kalkine Media® and see their performances:

Sonic Automotive Inc. (NYSE: SAH)

Fortune 500 company Sonic Automotive distributed a quarterly dividend of US$ 0.25 per share and its price-to-earnings (P/E) ratio is 6.13. Notably, the company's earnings per share (EPS) were US$ 8.87.

SAH stock jumped 9.47 per cent year-to-date (YTD) and over the last month, it soared 40.38 per cent. In continuation of the expansion drive of its franchise dealership, Sonic Automotive, on August 17, announced that it bought Audi Owings Mills in Maryland.

In its Q2 2022 financial results, Sonic reported quarterly revenues of US$ 3.7 billion. It was up nine per cent on a year-over-year (YoY) basis. It also registered a quarterly gross profit of US$ 588.8 million.

Sonic Automotive’s net income in Q2 2022 from continuing operations was US$ 94.8 million or US$ 2.34 per diluted share.

Addus HomeCare Corporation (NASDAQ: ADUS)

Addus provides home care services, mainly personal care services that aid daily living, home health services, and hospice.

Addus has a market cap of US$ 1.5 billion, and its earnings per share were US$ 2.76. It has a price-to-earnings (P/E) ratio of 33.7.

ADUS stock dropped 0.05 per cent year-to-date. However, it surged by over 10 per cent in the last six months.

In the second quarter of 2022, Addus HomeCare’s revenues grew 8.7 per cent to US$ 236.9 million, compared to US$ 217.8 million in the same quarter a year earlier.

The company’s net income was US$ 11.3 million in Q2 FY22, compared to US$ 11.6 million in Q2 2021.

5 S&P 500 small-cap stocks to explore during a downturnSource: ©Kalkine Media®; © Canva via Canva.com

Green Plains Inc. (NASDAQ: GPRE)

Green Plains is one of the largest producers of ethanol fuel in North America. It is involved in producing ethanol, corn oil, and grains. Green Plains also deals in grain procurement and other businesses like commodity marketing.

GPRE stock rose 0.87 per cent so far in 2022 and over the past month, the stock jumped 16.46 per cent. Shares of Green Plains gained 6.37 per cent year-to-date.

In Q2 FY22, Green Plains’ net income was US$ 46.4 million, up from US$ 9.7 million in Q2 FY21. It reported EBITDA of US$ 84.4 million in Q2 2022, relative to US$ 50.9 million for the same period in 2021.

GPRE stocks’ Relative Strength Index (RSI) value of 57.93 at the time of writing, as per Refinitiv, which points towards stability of the stock.

Urban Outfitters, Inc. (NASDAQ: URBN)

Urban Outfitters is a US multinational lifestyle retail company with operations in the US, UK, Sweden, Spain, Denmark, France, Germany, and several European countries.

The URBN stock plunged 26.7 per cent year-to-date (YTD). However, it saw a rise of over eight per cent over the past month.

Urban Outfitters released its Q2 2022 financial results on August 23, 2022. It posted a net income of US$ 59 million and earnings per diluted share of US$ 0.64 in Q2 2022.

For the quarter ended July 31, 2022, it reported total assets of US$ 3.7 billion, compared to US$ 3.8 billion in the year-ago quarter.

World Fuel Services Corporation (NYSE: INT)

World Fuel Services (WFS) is a US energy, commodities, and services firm headquartered in Doral, Florida. In 2018, the company reached the 91st spot on the Fortune 500 list.

WFS has a market cap of US$ 1.8 billion. The company distributed a dividend of US$ 0.12 per share on a quarterly basis.

The INT stock plummeted 12.4 per cent on a yearly basis. In the past month, the stock jumped 19.13 per cent. In its second-quarter financial results for fiscal 2022, World Fuel Services achieved a total gross profit of US$ 253.4 million, up 38 per cent year-over-year.

It earned a GAAP net income of US$ 24.4 million or US$ 0.39 per diluted share in Q2 2022. The adjusted EBITDA was US$ 76.4 million in the reported quarter.

Bottom line:

Although stocks may have performed well in the recent past, investors should do an in-depth analysis of stocks and their fundamentals before investing. It becomes even more relevant when the market is bearish and volatile.

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