Three Small Cap Stocks with Strong Buy Ratings and Big Upside Potential

Three small-cap stocks with a Strong Buy consensus and potential gains of at least 20% include Backblaze (BLZE), PowerFleet (AIOT), and Similarweb (SMWB). Backblaze trades at $7.46 with an average price target of $9.75, implying a 30% upside. PowerFleet trades at $4.60 with an average price target of $9.58, suggesting over a 100% upside. Similarweb trades at $8.72 with an average price target of $12.75, implying a 47% upside. Analysts point to solid expansion prospects in cloud storage, asset management software, and digital intelligence.

In a mixed market, investors are seeking stocks with strong analyst support and clear growth paths. Three small-cap companies have garnered a Strong Buy consensus and offer potential gains of at least 20% over the next year. These companies operate in cloud storage, asset management software, and digital intelligence, with analysts pointing to solid expansion prospects.

Backblaze (BLZE)

Backblaze, a cloud storage provider focusing on backup and B2 storage solutions, reported quarterly revenue of $36.3 million, up 16% year-over-year, with its B2 revenue up 29%. The company's momentum stems from the launch of B2 Overdrive and a sharp rise in demand from AI customers. Analysts see potential for significant growth, with the stock trading at $7.46 and an average price target of $9.75, implying a 30% upside [1].

PowerFleet (AIOT)

PowerFleet develops Internet-of-Things (IoT) asset-management solutions across sectors like logistics, auto, and retail. The company's service revenue grew 53% year-over-year to $86.5 million, reflecting its push into SaaS. Strategic partnerships and strong AI pipeline growth also stood out in the latest report. With shares trading at $4.60 and an average price target of $9.58, PowerFleet suggests over a 100% upside [1].

Similarweb (SMWB)

Similarweb provides digital intelligence tools that track website and app traffic. The company posted a 17% year-over-year revenue increase to $71 million, with its customer base expanding by 18% to nearly 6,000. Analysts point to strong adoption of its AI-driven data products and steady positive cash flow. The stock trades at $8.72, with an average price target of $12.75, implying a 47% upside [1].

Recent Performance and Guidance

Similarweb reported its Q2 2025 results, showing revenue of $71 million, a 17% increase year-over-year, and a customer base growth of 18% to almost 6,000 AR customers. The company generated $4 million in free cash flow, marking the seventh consecutive quarter of positive free cash flow. The stock has seen a positive operating profit of 3% in Q2 and expects full-year 2025 revenue to be in the range of $285 to $288 million, representing 15% growth at the midpoint [2].

Conclusion

These three small-cap stocks offer compelling investment opportunities with strong analyst support and significant upside potential. Investors should closely monitor these companies' progress and consider their respective growth prospects in cloud storage, asset management software, and digital intelligence.

References:
[1] https://www.tipranks.com/news/3-small-cap-stocks-with-strong-buy-ratings-and-big-upside-ahead
[2] https://finance.yahoo.com/news/similarweb-ltd-smwb-q2-2025-070930916.html