The Russell 2000 (^RUT) is home to many small-cap stocks, offering investors the chance to uncover hidden gems before the broader market catches on. However, these companies often come with higher volatility and risk, as their smaller size makes them more vulnerable to economic downturns.
Navigating this part of the market can be tricky, which is why we built StockStory to help you separate the winners from the laggards. That said, here is one Russell 2000 stock that could deliver strong gains and two best left off your watchlist.
Two Bank Stocks to Sell:
TriCo Bancshares (TCBK)
Market Cap: $1.62 billion
Founded in 1975 and headquartered in Chico, California, TriCo Bancshares (NASDAQ: TCBK) operates Tri Counties Bank, providing personal, small business, and commercial banking services through branches across California.
Why Is TCBK Not Exciting?
- Net interest income trends were unexciting over the last five years as its 6% annual growth was below the typical banking firm
- Concessions to defend its market share have ramped up over the last two years as its net interest margin decreased by 17 basis points (100 basis points = 1 percentage point)
- Performance over the past two years shows each sale was less profitable as its earnings per share dropped by 4.2% annually, worse than its revenue
TriCo Bancshares’s stock price of $49.76 implies a valuation ratio of 1.2x forward P/B. Read our free research report to see why you should think twice about including TCBK in your portfolio.
BankUnited (BKU)
Market Cap: $3.43 billion
Born from the ashes of a failed Florida thrift during the 2009 financial crisis, BankUnited (NYSE: BKU) is a regional bank that provides commercial lending, deposit services, and treasury solutions to businesses and consumers primarily in Florida and the New York metropolitan area.
Why Do We Pass on BKU?
- Annual net interest income growth of 5.4% over the last five years was below our standards for the banking sector
- Overall productivity is expected to decrease over the next year as Wall Street thinks its efficiency ratio will degrade by 18 percentage points
- Earnings growth over the last five years fell short of the peer group average as its EPS only increased by 4.4% annually
At $45.61 per share, BankUnited trades at 1.1x forward P/B. Check out our free in-depth research report to learn more about why BKU doesn’t pass our bar.
One Bank Stock to Watch:
Customers Bancorp (CUBI)
Market Cap: $2.55 billion
Originally founded with a "high-tech, high-touch" branch-light banking strategy, Customers Bancorp (NYSE: CUBI) is a bank holding company that provides commercial and consumer banking services through its Customers Bank subsidiary, with a focus on business lending and digital banking.
Why Do We Like CUBI?
- Market share has increased this cycle as its 14.8% annual net interest income growth over the last five years was exceptional
- Operating profits are forecasted to increase over the next year as it scales and becomes more productive
- Impressive 18.1% annual tangible book value per share growth over the last five years indicates it’s building equity value this cycle
Customers Bancorp is trading at $75.10 per share, or 1.2x forward P/B. Is now a good time to buy? See for yourself in our in-depth research report, it’s free for active Edge members.
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-small-cap company Exlservice (+354% five-year return). Find your next big winner with StockStory today for free. Find your next big winner with StockStory today. Find your next big winner with StockStory today.
