#7 - ThredUp (NASDAQ:TDUP)
The last of the small-cap stocks on this list is ThredUp (NASDAQ:TDUP). It’s also a penny stock, but it may not be for much longer. The company is essentially an online consignment store that allows consumers to buy and sell secondhand women’s and kids’ apparel, shoes, and accessories.
As you would expect, with inflation at 40-year highs, there’s significant demand for secondhand clothes in an effort to save money. In the first two quarters of 2022, revenue is up 28% to $149.12 million. The issue here is profitability. The company isn’t profitable now and is not expected to post a profit in the next few years.
In the short term, expect the strength of the company’s top line to continue, particularly as it promotes the environmental benefit of owning secondhand clothing. However, before taking a large position, it might be worth seeing if there’s interest in ThredUp as a takeover target. The recent acquisition of Poshmark (NASDAQ:POSH) is fueling speculation that the much smaller ThredUp could be purchased as well. That’s not a great reason to own the stock, but if you have some speculative dollars to put on a penny stock, this could pay off in the next couple of years.
About ThredUp
ThredUp Inc, together with its subsidiaries, operates an online resale platform in the United States and internationally. Its platform enables consumers to buy and sell primarily secondhand apparel, shoes, and accessories. ThredUp Inc was incorporated in 2009 and is headquartered in Oakland, California.
- Current Price
- $3.32
- Consensus Rating
- Moderate Buy
- Ratings Breakdown
- 3 Buy Ratings, 1 Hold Ratings, 0 Sell Ratings.
- Consensus Price Target
- $3.50 (5.4% Upside)
If you're familiar with small-cap stocks, then many of the names in this presentation may be familiar to you. If you're not, you may be pleased to see that you can find small-cap stocks in almost every market sector. And many of these companies have a solid history of revenue and earnings. They're just operating on a smaller scale.
If you like the idea of investing in small-cap stocks but don't find any of these stocks appealing, you can use the MarketBeat list of Top-Rated Small-Cap Stocks to generate ideas. You can also use the MarketBeat Stock Screener tool to refine your search even more.
And there's always the option to find an exchange-traded fund (ETF) or mutual fund that specifically tracks small-cap stocks. Two such options are the SPDR S&P 600 Small Cap ETF (NYSEARCA:SLY) and the Invesco S&P SmallCap Value with Momentum ETF (NYSEARCA:XSVM).
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