The Russell 2000 (^RUT) is packed with potential breakout stocks, thanks to its focus on smaller companies with high growth potential. However, smaller size also means these businesses often lack the resilience and financial flexibility of large-cap firms, making careful selection crucial.

Picking the right small caps isn’t easy, and that’s exactly why StockStory exists - to help you focus on the best opportunities. Keeping that in mind, here is one Russell 2000 stock that could be the next big thing and two that may face some trouble.

Two Stocks to Sell:

Red Rock Resorts (RRR)

Market Cap: $3.59 billion

Founded in 1976, Red Rock Resorts (NASDAQ: RRR) operates a range of casino resorts and entertainment properties, primarily in the Las Vegas metropolitan area.

Why Are We Wary of RRR?

1. 7.1% annual revenue growth over the last five years was slower than its consumer discretionary peers
2. Estimated sales growth of 1.9% for the next 12 months implies demand will slow from its two-year trend
3. Eroding returns on capital suggest its historical profit centers are aging

At $60.25 per share, Red Rock Resorts trades at 36.2x forward P/E. Read our free research report to see why you should think twice about including RRR in your portfolio.

Artivion (AORT)

Market Cap: $1.45 billion

Formerly known as CryoLife until its 2022 rebranding, Artivion (NYSE: AORT) develops and manufactures medical devices and preserves human tissues used in cardiac and vascular surgical procedures for patients with aortic disease.

Why Do We Avoid AORT?

1. Sales trends were unexciting over the last five years as its 7.2% annual growth was below the typical healthcare company
2. Modest revenue base of $390.1 million gives it less fixed cost leverage and fewer distribution channels than larger companies
3. Low returns on capital reflect management’s struggle to allocate funds effectively

Artivion is trading at $30.92 per share, or 46x forward P/E. To fully understand why you should be careful with AORT, check out our full research report (it’s free).

One Stock to Buy:

Construction Partners (ROAD)

Market Cap: $5.32 billion

Founded in 2001, Construction Partners (NASDAQ: ROAD) is a civil infrastructure company that builds and maintains roads, highways, and other infrastructure projects.

Why Is ROAD a Good Business?

1. Demand for the next 12 months is expected to accelerate above its two-year trend as Wall Street forecasts robust revenue growth of 39.6%
2. Earnings growth has trumped its peers over the last two years as its EPS has compounded at 91% annually
3. Rising returns on capital show the company is starting to reap the benefits of its past investments

Construction Partners’s stock price of $90.50 implies a valuation ratio of 40.4x forward P/E. Is now the time to initiate a position? Find out in our full research report, it’s free.

Stocks We Like Even More

When Trump unveiled his aggressive tariff plan in April 2025, markets tanked as investors feared a full-blown trade war. But those who panicked and sold missed the subsequent rebound that’s already erased most losses.

Don’t let fear keep you from great opportunities and take a look at Top 9 Market-Beating Stocks. This is a curated list of our High Quality stocks that have generated a market-beating return of 183% over the last five years (as of March 31st 2025).

Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,545% between March 2020 and March 2025) as well as under-the-radar businesses like the once-micro-cap company Kadant (+351% five-year return). Find your next big winner with StockStory today for free.

StockStory is growing and hiring equity analyst and marketing roles. Are you a 0 to 1 builder passionate about the markets and AI? See the open roles here.