From small caps to big winners: 5 stocks that delivered huge gains

Skip to Content News Archives Economy Energy Oil & Gas Renewables Electric Vehicles Mining Commodities Agriculture Real Estate Mortgages Mortgage Rates Finance Banking Insurance Fintech Cryptocurrency Work Wealth Smart Money Wealth Management Investor Personal Finance Family Finance Retirement Taxes High Net Worth FP Comment Executive Women Puzzmo Newsletters Financial Times Business Essentials More Innovation Information Technology FP500 Podcasts Small Business Lives Told Tails Told Shopping Financial Post Store Obituaries Place a Notice Advertising Advertising With Us Advertising Solutions Postmedia Ad Manager Sponsorship Requests Classifieds Place a Classifieds ad Working Profile Settings My Subscriptions My Offers Newsletters Customer Service FAQ News Economy Energy Mining Real Estate Finance Work Wealth Investor FP Comment Executive Women Puzzmo Newsletters Financial Times Business Essentials This advertisement has not loaded yet, but your article continues below.HomeInvestorFrom small caps to big winners: 5 stocks that delivered huge gainsPeter Hodson: Higher volatility and financial risk come with the territory, but small companies have more room to growStock market numbers are displayed on the floor of the New York Stock Exchange during morning trading on March 25, 2026 in New York City. Photo by Michael M. Santiago/Getty Images filesThis column continues a series on small-cap stocks. The last one looked at small caps in general, and noted some historical performance.THIS CONTENT IS RESERVED FOR SUBSCRIBERS ONLYSubscribe now to read the latest news in your city and across Canada.Exclusive articles from Barbara Shecter, Joe O'Connor, Gabriel Friedman, and others.Daily content from Financial Times, the world's leading global business publication.Unlimited online access to read articles from Financial Post, National Post and 15 news sites across Canada with one account.National Post ePaper, an electronic replica of the print edition to view on any device, share and comment on.Daily puzzles, including the New York Times Crossword.SUBSCRIBE TO UNLOCK MORE ARTICLESSubscribe now to read the latest news in your city and across Canada.Exclusive articles from Barbara Shecter, Joe O'Connor, Gabriel Friedman and others.Daily content from Financial Times, the world's leading global business publication.Unlimited online access to read articles from Financial Post, National Post and 15 news sites across Canada with one account.National Post ePaper, an electronic replica of the print edition to view on any device, share and comment on.Daily puzzles, including the New York Times Crossword.REGISTER / SIGN IN TO UNLOCK MORE ARTICLESCreate an account or sign in to continue with your reading experience.Access articles from across Canada with one account.Share your thoughts and join the conversation in the comments.Enjoy additional articles per month.Get email updates from your favourite authors.THIS ARTICLE IS FREE TO READ REGISTER TO UNLOCK.Create an account or sign in to continue with your reading experience.Access articles from across Canada with one accountShare your thoughts and join the conversation in the commentsEnjoy additional articles per monthGet email updates from your favourite authorsSign In or Create an AccountHere, we will delve into why investors even bother with small caps, considering their underperformance of the past 15 years, their high volatility and their typically heightened financial risks.While there are several reasons to buy small cap stocks, some of which we will look at in another column, for now we will focus on one reason: potential outperformance.Small companies have an easier time growing. A single $50 million contract is almost meaningless to a $1 trillion company, but can be transformative for a $100 million company. Small companies are nimbler and can adapt to competitive, economic and market changes quickly. Small companies can have lower administration costs, as they are less bureaucratic than giant conglomerates.Canada's best source for investing news, analysis and insight.By signing up you consent to receive the above newsletter from Postmedia Network Inc.A welcome email is on its way. If you don't see it, please check your junk folder.The next issue of Investor will soon be in your inbox.We encountered an issue signing you up. Please try againThere are many reasons for investors to be interested in small caps. But likely the biggest one is the potential performance difference. In other words, investors will accept many risks if they believe there is big upside ahead.Considering that, let’s see how well things can go when they do go well. While these are not stock recommendations, we will look at five former small-cap companies that achieved various levels of success and investment performance for investors. Three examples of stocks 5i Research has been involved with, and two are small caps that have started to surge this year and may be worth watching.Amaya Gaming (now Flutter Entertainment FLUT on NYSE)5i Research got involved with Amaya back in 2012, when it was one of the first companies that we issued a research report on. The stock was in the $2 range at the time, and market capitalization was about $80 million. We had met management, and thought they were solid. We liked the gambling industry and Amaya laid out big plans for how it intended to grow. We thought the stock might go to $10 a share, which of course would be a nice move. But the company became very aggressive with acquisitions, consolidating several other Canadian public companies in the gaming space. Then, in 2014, it went big: It acquired Stars Group in a giant $4 billion acquisition, funded by a big share sale at a premium and lots of debt. Its timing was near-perfect, as online poker took off with TV coverage of big games and as banks relaxed their restrictions on gambling. Amaya changed its name to the Stars Group, and it itself was acquired by Ireland-based Flutter Entertainment PLC in 2020. Its market cap at the time of the takeover was about $6 billion. Flutter shares have weakened in the past few years, but in August former Amaya shareholders (with share conversion) had shares worth close to $100. Flutter market cap is now about US$17 billion.Nebius Group (NBIS on Nasdaq)Our sister company, i2i Capital Management, first noticed Nebius, a data-centre neocloud company, in 2024, when the stock was about US$20 a share. It was a bit unusual at the time, in that it had very little revenue and the stock was even restricted at some brokerages. The reason: It was essentially a company consisting of engineers who had fled Russia and who denounced the Ukraine War. The founder took the engineers out of Yandex, a Russian technology company, and set up shop in the Netherlands. Because of the prior Russian connection, many brokers and investors avoided the stock like the plague. But then it became a full Dutch company with zero ties to Russia. Market cap in 2024 was US$4 billion, as the company found some investors willing to back its new plans. Today, with some giant contracts, more capital raises, the AI surge and forecasted 2027 revenue of US$12 billion, market cap is US$60 billion. Shares have gone from about $17 in 2024 to a peak of $299 in June this year (now about $210). With the big run it is now one of the largest positions in the i2i Long/Short US Equity Fund.This advertisement has not loaded yet.This advertisement has not loaded yet, but your article continues below.Booking Holdings Inc. (BKNG on Nasdaq)In the early 2000s, working at Sprott Inc. at the time, I discovered Booking (known as Priceline at the time). In 2006 the stock hit a low of US$1.24 in 2006 (it was even lower in prior years but I had never heard of it as it was so small). It was an online travel company, and had excellent marketing and made excellent acquisitions (such as Open Table) in order to consolidate and grow its market. Market cap in 2006 was $1.7 billion. Today, market cap is US$129 billion. That early US$1.24 stock hit US$232 in July of last year, and is about US$172 today.Since these are all historical accounts, let’s get more current and discuss some of this year’s small-cap winners next. We cannot of course tell you if these are the next giant winners, but we can tell you this: a) an investor cannot see a stock go up 5,000 per cent if it doesn’t go up 100 per cent first; b) small caps that move up can get a lot more attention from investors and c) the following stocks have done very well this year and are off to a good start.Canadian winnerTo avoid the riskiest microcap stocks, we chose 2026 winners from stocks with market cap only above $100 million. Tintina Mines Ltd. (TTS on TSXV) was the winner, up about 590 per cent this year. Market cap is now about $560 million. The stock has run with the mining sector and the company has also raised significant capital this year. It is developing a copper-gold project in Chile.U.S. winnerWith the larger size of the capital markets south of the border, we restricted our search to companies with a market cap of US$2 billion to US$3 billion. The winner there was Aehr Test Systems Inc. (AEHR on Nasdaq), up about 304 per cent this year, with a market cap of US$2.6 billion. Its market cap was less than US$300 million last year. Its systems are designed to reduce the cost of computer memory, so its surge this year should not be that surprising to anyone watching the AI trade.Peter Hodson, CFA, is founder of 5i Research Inc., an independent investment research network helping do-it-yourself investors reach their investment goals. He is also portfolio manager for the i2i Long/Short U.S. Equity Fund. (5i Research staff do not own Canadian stocks. i2i Long/Short Fund may own non-Canadian stocks mentioned.) If you like this story, sign up for the FP Investor Newsletter.Notice for the Postmedia NetworkThis website uses cookies to personalize your content (including ads), and allows us to analyze our traffic. Read more about cookies here. By continuing to use our site, you agree to our Terms of Use and Privacy Policy.