Small-Cap Resurgence in 2026

Former winners are lagging as left-for-dead names reawaken to climb higher. Some huge technology stocks are being sold, and many smaller stocks are being bought.

But if you’re just looking at the S&P 500 (GSPC), it may not seem evident.

A Risk-On Rally in Smaller Companies

There is a catchup trade happening and small companies are at the heart of it.

Small-cap stocks have been out of favor for years, but they’re making a comeback. In fact, the Russell 2000 (RUT) is now beating the S&P 500 and the Nasdaq 100 (NDX) in all timeframes over the last year:

Why is that? Much of it has to do with a changing environment.

The general landscape for businesses is improving. Federal Reserve interest rate cuts, a stronger economy, and growing corporate investment are prevalent. It’s unleashed a risk-on rally in smaller companies.

Serious Demand in Two Sectors for Small-Cap Stocks

MoneyFlows data shows where Big Money investors are pouncing.

Looking at the 2026 action from a market capitalization standpoint, investors have been bullish in general. More specifically, there’s a healthy appetite for smaller companies:

Sector strength has shifted too.

For most of 2025, technology led the way. Now technology and communications have fallen as energy, materials, and industrials soar:

MoneyFlows data reflects serious demand for small-cap tech and discretionary stocks.

For instance, ACM Research, Inc. (ACMR) is a $3.4 billion company that develops, manufactures, and sells semiconductor processing equipment. Three-year sales growth is 44.5%, while three-year earnings growth is 41.6%.

No wonder Big Money is buying:

Media company Fox Corporation (FOXA) has a market cap of $32.1 billion and has been a Big Money target too:

It’s not surprising considering the company’s one-year sales growth of 16.6% and three-year per-share earnings growth of 34.2%.

Another media company seeing inflows is the New York Times Company (NYT). This $11.6 billion organization has a three-year EPS growth rate of 13.9%, three-year sales growth of 7.6%, and an 11.4% profit margin.

Look at the inflows:

Lastly, Rambus, Inc. (RMBS) is a $13.4 billion tech company focused on semiconductors and high-performance memory applications. Its shares have nearly doubled in the last six months thanks to institutional inflows:

Big Money is drawn to the company because it’s grown sales by 20.2% over the last three years, has minimal debt, and is expected to grow EPS by 19.2% in the next year.

Find New Leaders

Maybe you’ve heard those names, maybe you haven’t. None were market leaders in 2025.

But it’s 2026 and time to find new leaders. This is where MoneyFlows shines. See the stocks soaring while indexes sputter.

If you are a Registered Investment Advisor (RIA) or a serious investor, take your investing to the next level and follow our free weekly MoneyFlows insights.

Disclosure: the author holds no positions in ACMR, FOXA, NYT, or RMBS at the time of publication.