The Russell 2000 is one of the most popular stock indexes, consisting of the 2000 smallest companies from the Russell 3000. Most companies in the index are small cap, which often means more volatility and growth potential. After years of underperformance caused by economic uncertainty, many stocks in the Russell 2000 are trading at a discount. As companies’ earnings in the index improve and the economy recovers, Russell 2000 is bound to benefit. Below are the three best Russell 2000 stocks to buy.
ACM Research (ACMR)
ACM Research (NASDAQ:ACMR) is a leading American company in wafer packaging and cleaning for the semiconductor industry, which is likely to benefit from the increasing demand for AI offerings. Its famous flagship product, the Space Alternated Phase Shift (SAPS), uses megasonic waves to clean semiconductor wafers. This technology has contributed to ACM Research’s major revenue growth in the past few years. Last year, ACM experienced a 43% increase in revenue YOY.
While the semiconductor industry did not perform well in 2023, the market should return to growth in 2024 at an estimated 16.8% rate. ACM primarily supplies Chinese manufacturers, a market the company has rapidly expanded through large investments and subsidies. In 2024, the company’s revenue is expected to grow from $650 million to $725 million from $558 million in 2023. There is no better time than now for investors to buy ACM Research.
Celsius (CELH)
American beverage company Celsius Holdings (NASDAQ:CELH) is growing in popularity. The company makes carbonated and noncarbonated energy drinks and ranks No.1 out of 17 stocks in the nonalcoholic group. Celsius has rapidly increased globally, including the CEO’s newest announcement on the company’s expansion into Australia and New Zealand.
Celsius has also completed a sales and distribution agreement with Suntory Beverage & Food Great Britain and Ireland, and the sales for those markets are projected to start in Q2 of 2024. In Q4 FY2023 earnings, Celsius reported a 95% increase in revenue at $347.4 million and improved earnings of $0.17 per share, as opposed to a loss of $0.12 cents per share just a year ago. On Amazon in 2023, Celsius has the highest market share with 19.7%, dominating its competitors such as Monster and RedBull. With a growing international presence and positive financials, Celsius offers a promising future for investors.
Abercrombie & Fitch (ANF)
Abercrombie & Fitch (NYSE:ANF) is a clothing retailer with over 850 stores globally, including in the United States, Europe, Asia, Asia-Pacific, Canada and the Middle East. The company owns five different brands–Hollister, Abercrombie Kids, Gilly Hicks, Social Tourist and Abercrombie & Fitch. The company’s sales increased 21% YOY due to higher prices and reduced cost of raw materials while avoiding major supply chain issues.
In Q4 FY 2023, Abercrombie had $2.97 earnings per share as opposed to the expected $2.83 EPS. The stock has experienced immense 371% YoY growth while staying profitable the entire time, and this is especially impressive considering that Abercrombie & Fitch is in retail rather than quickly growing industries like AI. The American retailer reached $335 million in profits for the year 2023, which highlights their profitability and strong shareholder returns. The fast growing expansion and strong financials forecast a positive future for Abercrombie & Fitch.
On the date of publication, Tomas Levani did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.