Small Caps That Have My Attention
What could be next after AAOI, AXTI, LASR, and AEHR?
Whether it’s AAOI, AXTI, LASR, or AEHR, there has been no shortage of big movers in the sub $3B market cap realm.
One thing all of these stocks have in common is that they’re in the right theme.
AAOI: lasers and optical transceivers tied to AI data center buildouts.
AXTI: compounds feeding advanced chips and photonics.
AEHR: test and burn in systems critical to silicon carbide and semiconductors.
LASR: industrial laser systems.
Lasers, optics, photonics, semiconductors.
These are themes that have been moving higher over the last few months, despite the weakness in the indices and underneath the hood in former leaders. The key to finding these types of stocks is finding the right stocks at the right time in the right theme.
I want to highlight that AEHR and AAOI were highlighted in this Substack far lower than current prices, very recently:
Now, I have my eye on a few different names here.
These are six small caps (sub $3B market cap) I believe are positioned in the right themes and groups at the right time. I have been discussing some of these stocks in the subscriber chat over the last few weeks, if you’re not in I suggest joining. We have a solid group of minds in there sharing ideas.
Identifying smaller companies that sit in front of structural demand shifts has been key to success in this market environment. In the remainder of this article I’m going to discuss each name individually, walk through the underlying potential narrative, the levels I’m watching, and my thesis for why I think the setup is compelling here.