3 Small Cap Stocks With Big Upside If the Bull Market Continues

Summary: In a strong market, smaller companies can sometimes move faster than household-name giants—especially when they’re tied to fast-growing themes like AI infrastructure, 5G networks, and next-generation data centers. This rewritten report breaks down three small-cap names highlighted by 24/7 Wall St. and explains why they’re on investors’ radars, what metrics matter, and what risks you should keep in mind before buying any stock. (Original source)

Why Small-Cap Stocks Can Outperform During a Bull Market

Small-cap stocks are often described as the “undiscovered corner” of the market. They’re typically companies with smaller market values, fewer analysts covering them, and less attention from major institutional investors. That lack of spotlight can create opportunity—because when a company finally hits a growth inflection point (like landing a big customer, launching a product, or scaling revenue), the stock can reprice quickly.

In a bull market, optimism usually spreads. Investors who already made money in large-cap leaders sometimes start looking for “the next wave” of returns in smaller names. That shift can send small caps higher—sometimes dramatically—because the share floats can be smaller and sentiment can move faster than fundamentals in the short term.

But small caps come with real trade-offs. Many are earlier in their business lifecycle, still proving their products, still building stable customer demand, or still working toward consistent profitability. Their stocks can be more volatile, more sensitive to economic slowdowns, and more exposed to financing conditions (like interest rates and capital availability).

Key idea: The upside can be big, but the path is rarely smooth. A smart approach is to focus on business quality, balance-sheet strength, credible growth plans, and real signs of demand—not just hype.

What This Report Covers (And What It Doesn’t)

This is a detailed English rewrite of a market note that highlights three small-cap companies:

• Amplitech (NASDAQ: AMPG) – radio frequency components tied to AI, 5G, and advanced computing needs
• Digi Power X (NASDAQ: DGXX) – a firm pivoting toward Tier III AI data centers while also holding crypto-related exposure
• POET Technologies (NASDAQ: POET) – photonics and optical modules aimed at accelerating AI data center connectivity

Important: This article is for informational purposes and is not personal financial advice. Small-cap stocks can rise quickly—but they can also fall quickly. Always do your own research and consider talking to a licensed professional if you’re unsure.

Big Market Theme: AI Infrastructure Is More Than Just Chips

When most people think about AI investing, they think of big chip makers, cloud giants, or flashy software platforms. But AI’s growth depends on a huge supporting cast—hardware suppliers, connectivity providers, data center builders, and specialized component makers.

AI workloads are demanding. They require:

• High-performance computing (powerful GPUs/accelerators)
• Fast data movement (optical modules, photonics, high-speed interconnects)
• Reliable wireless and RF performance (for communications infrastructure and specialized applications)
• Data center capacity (megawatts of power, cooling, networking, and redundancy)

This is where some smaller companies can carve out a niche. If they’re truly providing critical “picks and shovels” to a long-term buildout, revenue growth can accelerate—and in a favorable market environment, stock prices can react strongly.

Stock #1: Amplitech (NASDAQ: AMPG)

What the Company Does

Amplitech produces high-performance radio frequency (RF) components. RF components are used in systems that transmit, receive, and process signals—an essential layer of modern communications. As the world leans harder into AI-driven networks, 5G connectivity, and specialized computing fields, demand for reliable, high-quality RF solutions can increase.

According to the source article, Amplitech’s components are positioned as “essential” for growth areas like AI, 5G, and even quantum computing. The piece also notes the company has worked with notable organizations and brands, including IBM, Disney, and NASA.

Growth Signals Mentioned

The article highlights a major revenue jump: Amplitech’s revenue was reported as up 115% year-over-year in Q3 2025, and gross profits “more than doubled.”

For small caps, growth rate matters because it helps answer a simple question: Is the market for the product real and expanding? Revenue growth can sometimes be lumpy for small firms—one large contract can swing results—so investors often look for:

• Repeated growth across multiple quarters
• More diversified customer demand
• Improving margins (or at least stable margins as sales scale)

Balance Sheet and Financial Posture

One notable point from the original piece is that Amplitech is described as having a strong balance sheet with $11.9 million in cash and zero long-term debt.

For investors, this matters because smaller companies often face higher financing risk. When rates are high or capital markets tighten, companies with heavy debt loads—or those that must raise cash frequently—can be pressured. A cleaner balance sheet can provide flexibility to invest in growth without immediately needing expensive funding.

Forward-Looking Targets (Projections)

The article notes management projections of $25 million in fiscal 2025 sales and “at least $50 million” in fiscal 2026 revenue.

Reminder: Projections are not guarantees. They are goals based on assumptions—orders, production capacity, customer demand, and execution all have to line up. Still, these targets are useful as a framework for what the company believes is possible.

Industries Amplitech Is Targeting

The report points to multiple industries Amplitech wants to expand into, including:

• Wireless power transmission
• Public and private 5G business/security
• Defense and IT security
• Quantum computing/blockchain-related areas

It also argues that because Amplitech still has limited penetration in these markets, growth could accelerate if execution is strong.

Key Risks to Watch

Even with promising numbers, investors should keep an eye on risks common to small technology suppliers:

• Customer concentration: If a few customers drive most sales, a single lost contract can hurt.
• Manufacturing and delivery execution: Supply chain issues or production constraints can limit growth.
• Competition: Larger competitors may have more scale, more pricing power, or stronger distribution.
• Volatility: Small caps can swing sharply on earnings, guidance, or even market sentiment.

Stock #2: Digi Power X (NASDAQ: DGXX)

The Core Idea: A Data Center Pivot With AI Exposure

Digi Power X is presented as an “AI data center stock” that has “almost doubled over the past year,” according to the source. The central story here is scale: building out data center capability—especially facilities suited to AI workloads—can create a pathway to higher-value revenue than older-style crypto-focused data operations.

Data centers are often measured in megawatts (MW) because power is the lifeblood of computing. AI racks consume serious electricity. A company that can secure power, build facilities, and attract customers can potentially generate recurring revenue—but this is capital-intensive and execution-heavy.

Investment in Nvidia Chips

The article notes Digi Power X made a recent $20 million investment in Nvidia chips—a signal of intent to expand AI compute capability. In plain terms, the company is trying to ensure it has the hardware needed to serve AI demand.

For investors, the details that matter include:

• How quickly those chips can be deployed into revenue-producing contracts
• Utilization rates (are the GPUs busy or sitting idle?)
• Pricing power and contract terms
• Operating costs (power, cooling, maintenance)

Crypto Holdings and Mixed Exposure

The original report adds that Digi Power X has been increasing its Bitcoin and Ethereum holdings. This adds an additional layer of volatility because crypto prices can swing sharply. Some investors may like that optionality; others may prefer a pure-play data center strategy.

Tier III AI Data Centers and Scaling Plans

The article states Digi Power X is scaling Tier III AI data centers, describing them as more lucrative than crypto data centers. It also outlines a growth plan to expand from 5 MW in Q1 2026 to 55 MW in Q4, including 40 MW of critical load capacity.

“Critical load” generally refers to the power actually available for computing equipment (not just total facility power). This matters because it’s closer to the number that can generate revenue from hosting AI infrastructure.

Longer-Term Power Availability Targets

The report also says Digi Power X has “almost 200 MW of available power today,” with “an additional 200 MW” expected to become available by 2028. It further claims the company expects 195 MW online by the end of 2027, including 140 MW of critical IT load.

Those are ambitious numbers. For investors, the big question is whether Digi Power X can execute on:

• Permitting and construction timelines
• Power contracts and grid access
• Cooling and infrastructure buildouts
• Customer acquisition (filling the capacity)

“Missed IREN?”—The Momentum Angle

The article suggests that investors who feel they missed out on IREN may want to take a closer look at Digi Power X. This is a classic market behavior: once a theme becomes popular, investors often search for “the next similar story” at a smaller size.

Key Risks to Watch

Digi Power X has a compelling narrative, but also several risks that deserve attention:

• Execution risk: Data center buildouts are expensive and complex.
• Financing risk: Expansion may require raising capital, which can dilute shareholders.
• Market competition: The AI data center space is crowded and getting more competitive.
• Crypto exposure: Bitcoin/Ethereum holdings can introduce extra volatility.

Stock #3: POET Technologies (NASDAQ: POET)

What POET Builds: Photonics for Faster Data

POET Technologies focuses on photonic integrated circuits, light sources, and optical modules for AI data centers. In data centers, speed isn’t just a “nice-to-have.” As AI models grow, data must move rapidly between chips, servers, and storage. Optical technology can improve bandwidth and reduce bottlenecks compared with older approaches.

The original piece emphasizes a simple benefit: these components can increase data speed, and faster data speed helps providers “get more out of every chip.” If you’re spending huge money on GPUs, you want the surrounding network to keep up.

Positioning for the AI Infrastructure Buildout

The report frames POET as well positioned for the AI infrastructure buildout, especially as it approaches commercial launches for optical engine and light source products.

For investors, “commercial launch” is a key milestone. Many small tech firms spend years in R&D and prototypes. A move to real orders and repeatable shipments is often where the business story changes—from “promise” to “proof.”

Early Orders and a “Revenue Ramp” Narrative

According to the article, POET told investors that orders tied to upcoming launches are “the beginning of a revenue ramp up” expected to increase throughout 2026. That phrase matters because markets tend to reward companies that can show:

• Growing order flow
• Repeat customers
• Scaling revenue beyond a tiny baseline

Revenue Growth: From Tiny to Noticeable

The source provides a striking comparison: POET made $298,434 in Q3 2025 revenue versus $3,685 in Q3 2024.

That’s a massive percentage increase, but it’s important to interpret it correctly. When you start from a very small number, growth rates can look huge. The more important question is whether the company can keep scaling so revenue becomes substantial enough to support ongoing operations and long-term profitability.

Stock Performance Mentioned

The article says POET outperformed the S&P 500 with a 16% year-to-date gain and is up by more than 60% over the past year. Performance doesn’t prove fundamentals, but it can signal that investors are increasingly paying attention—especially if it coincides with product milestones and customer adoption.

Key Risks to Watch

Photonic and optical hardware stories can be powerful, but risks include:

• Commercialization risk: Launches must translate into real, repeatable revenue.
• Customer qualification cycles: Data center buyers can take time to test and validate components.
• Competition: Optical and photonics markets can be competitive, with established players.
• Cash burn: Early-stage companies may need funding before profitability.

Comparing the Three: What’s Similar, What’s Different

Company	Main Theme	What Could Drive Upside	Main Risk
Amplitech (AMPG)	RF components for AI/5G/advanced computing	Fast revenue growth + strong balance sheet + expansion into high-growth verticals	Customer concentration, competition, execution
Digi Power X (DGXX)	AI data centers + GPU deployment	Scaling MW capacity and monetizing AI compute demand	Capital intensity, financing, crypto volatility
POET Technologies (POET)	Photonics/optical modules for AI data centers	Commercial launches + revenue ramp as AI networking demand rises	Commercialization timeline, funding needs

How Investors Often Evaluate “Big Upside” Small Caps

If you’re trying to understand why these kinds of stocks can run in a bull market, it helps to know the checklist many investors use. While everyone has a different style, common evaluation points include:

1) A Clear Tailwind

AI, 5G, and data center buildouts are large, multi-year trends. If a company sells a product that sits directly in that path, it may have more room to grow than a business tied to a shrinking market.

2) Evidence of Demand

Revenue growth, signed orders, customer announcements, and repeat purchases matter. “Potential” becomes more credible when customers are paying.

3) Balance Sheet Strength

Cash and manageable debt can help a small company survive bumps in the road and keep investing in growth.

4) A Realistic Scaling Plan

Ambitious targets can be exciting, but investors should check whether timelines, costs, and operational capacity make sense.

5) Risk Management

Small-cap investing is not about being right every time—it’s about controlling downside when the story changes.

FAQs (Frequently Asked Questions)

1) What is a small-cap stock?

A small-cap stock is typically a company with a smaller market value than large, well-known corporations. Definitions vary, but small caps are generally earlier-stage or less widely followed than mega-cap leaders.

2) Why do small caps sometimes outperform in a bull market?

In a bull market, investors often take on more risk and search for faster growth. Small caps can move more quickly because fewer investors own them, and positive news can lead to rapid revaluation.

3) Are these stocks “safe” investments?

No small-cap stock is “safe” in the way a diversified index fund might be considered lower risk. These stocks can be volatile, and outcomes depend heavily on execution, financing, and market conditions.

4) What does “megawatts” mean for a data center company like Digi Power X?

Megawatts measure power capacity. More available power can mean more computing capacity, which can translate into more revenue—if the company can build facilities and attract customers to use that capacity.

5) Why are photonics and optical modules important for AI data centers?

AI systems require huge amounts of data transfer. Optical technologies can help move data faster and more efficiently, reducing bottlenecks and improving overall performance.

6) What’s the biggest risk when investing in fast-growing small caps?

The biggest risk is usually execution—the company may not meet growth targets, may struggle to scale, or may need to raise capital in ways that dilute shareholders.

Conclusion: High Upside, High Responsibility

These three small-cap names—Amplitech, Digi Power X, and POET Technologies—share a common theme: they’re connected to big, modern growth engines like AI infrastructure, high-speed connectivity, and next-gen data centers. The original report argues they may have “big upside” if the bull market continues, and it backs that view with specific highlights such as revenue growth, scaling plans, and product positioning.

Still, it’s crucial to stay grounded. Small caps can be exciting, but they require careful research, realistic expectations, and a strong awareness of risk. If you choose to follow these names, consider tracking earnings updates, customer momentum, cash levels, and whether business milestones are being met over time.

Disclosure-style note: This content is educational and based on publicly available commentary. It is not individualized investment advice.

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