Top Five Performing Small-Cap Companies for the First Half of 2016

Joel Anderson  |

Well, the first half of 2016 is in the book and wow, was that half a year. Not to mention, it really closed with a bang as Brexit prompted a positively brutal trading day on Friday. However, given that it is, in fact, over, perhaps we can now start our earliest post mortem. The S&P 500 is up 2.69% since the start of the year, but that’s only telling part of the story. It began the year in a slump, but from a February 11 reversal to Thursday’s pre-Brexit high, the index went on a 15.54% run.

Among the blue chips, the big winners were oil and telecom companies, with AT&T (T) and Verizon (VZ) gaining 25.52% and 20.86% respectively, and Royal Dutch Shell (RDS.A) and Exxon Mobil (XOM) up 20.59% and 20.3%. However, we here at Equities.com don’t fall into the trap of just focusing our coverage on the big names. We try to give the emerging growth companies of the small- and micro-cap communities the coverage they so richly deserve.

Small-cap stocks have not gained as much as their large-cap brethren, with the Russell 2000 gaining only 1.38% year-to-date. However, that’s also due to the way small caps are sensitive to volatility. Like the S&P 500, the Russell was hot from mid-February until the recent Brexit sell off, gaining 22.91% in that time frame.

So, without further ado, here are the top five gainers in the small-cap range (between $100 million and $2 billion in market cap).

Vista Gold Corp. (VGZ)

Market Cap: $166.72 million

2016 YTD Performance: 593.54%

Gold prices are up significantly this year, climbing 22.95% from $1,075.10 an ounce on January 3 to $1,321.87 an ounce, so it’s no surprise that gold mining companies are also on the rise. However, given that Vista Gold is worth about seven times what it was at the start of the year, it’s clear that Vista Gold is exceeding performance even under the circumstances. Especially when you consider the fact that shares had pretty consistently been bouncing around in the $0.20 to $0.40 range from October of 2014 through January 2016, the explosion to about $2.00 a pop over the last five months is pretty huge for Vista.

Couer Mining Inc. (CDE)

Market Cap: $1.82 billion

2016 YTD Performance: 329.44%

And here we are again. Gold companies are especially sensitive to change in the price of gold, something that’s especially true for the mining juniors, so the biggest jump in spot prices since 2011 was bound to mean a serious spike for a lot of small-cap gold companies. Couer, though, like Vista, is among the cream of the crop, more than quadrupling its value since the New Year.

Ryerson Holding Corp. (RYI)

Market Cap: $600.65 million

2016 YTD Performance: 274.52%

Ryerson Holding is a service center company that processes and distributes over 70,000 stainless steel, carbon, and aluminum products. The company rode a massive earnings beat in March to its current stellar year, exceeding the Zacks estimate by some 225% in its 2016 first quarter. At the heart is likely the huge rally for steel prices that has taken the stock to its highest levels since 2014.

Cliff’s Natural Resources (CLF)

Market Cap: $1.08 billion

2016 YTD Performance: 258.23%

It’s been a good year for Cliff. Cliff’s Natural Resources supplies iron ore pellets to the North American steel industry, meaning that the story of the third and fourth companies on this list are pretty similar to those of the first and second: a rising tide raises all ships.

Fairmount Santrol Holdings Inc. (FMSA)

Market Cap: $1.27 billion

2016 YTD Performance: 227.23%

Fairmount Santrol is a company that provides sand-based proppant solutions to fracking companies. At first blush, this seems like a pretty odd company to be sitting in the top five, given that depressed oil prices have hammered the domestic oil and gas industry, particularly those in the fracking space. However, look closer and it’s clear that Fairmount’s performance this year isn’t exactly great news for its shareholders. In fact, it’s a lot of the same reasons why Royal Dutch Shell and Exxon were among the best performing mega caps. January happened to be the bottom of the trough for oil companies following the precipitous decline in oil prices. For Fairmount Santrol, shares are still down 11.28% over the last 12 months and worth less than half what it was when it IPO’d at $16 a share.

DISCLOSURE: The views and opinions expressed in this article are those of the authors, and do not represent the views of equities.com. Readers should not consider statements made by the author as formal recommendations and should consult their financial advisor before making any investment decisions. To read our full disclosure, please go to: http://www.equities.com/disclaimer.

Companies

Symbol Name Price Change % Volume
VGZ Vista Gold Corp 0.85 0.02 2.70 125,326
RYI Ryerson Holding Corporation 8.91 -0.15 -1.66 130,063 Trade
CLF Cleveland-Cliffs Inc. 7.73 -0.23 -2.89 14,194,991 Trade
CDE Coeur Mining Inc. 5.27 0.26 5.19 11,257,341 Trade

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