Investing in up-and-coming stocks means having an appetite for risk, as this approach often involves chasing the latest Wall Street buzz. For instance, right now, some of the highest fliers are biotech and artificial intelligence plays that have great long-term promise but little short-term profitability.
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Smaller companies often experience greater price swings than established blue-chip stocks because of this lack of consistency. However, a small company can also deliver outsized returns when it begins to scale and investors believe it’s on the cusp of becoming a new market leader.
The current bull market has rewarded investors willing to look beyond household names and consider companies valued at under $8 billion that have posted eye-popping returns in the past year. For investors who actively manage their portfolios and are looking beyond vanilla index funds and the same old list of mega-cap stocks, these up-and-coming investment opportunities are worth a look.
| Stock | Market capitalization | Trailing-12-month return as of Aug. 12 |
| Aehr Test Systems Inc. (ticker: AEHR) | $4.1 billion | 564% |
| Enliven Therapeutics Inc. (ELVN) | $4.3 billion | 207% |
| Erasca Inc. (ERAS) | $6.4 billion | 1,091% |
| Iridium Communications Inc. (IRDM) | $5.3 billion | 102% |
| Maase Inc. (MAAS) | $6.9 billion | 364% |
| Sezzle Inc. (SEZL) | $4.4 billion | 41% |
| Twist Bioscience Corp. (TWST) | $7.8 billion | 356% |
Aehr Test Systems Inc. (AEHR)
Artificial intelligence has become one of the biggest investment themes in recent years, but every AI system depends on increasingly sophisticated semiconductors. That’s where Aehr Test Systems has carved out an attractive niche. The company designs specialized equipment that tests and burns in semiconductor devices before they are deployed, helping manufacturers improve reliability while reducing costly failures. Founded in 1977 and headquartered in California, Aehr also benefits from increased interest in strengthening domestic semiconductor manufacturing and reducing reliance on overseas supply chains. Those long-term industry trends have helped fuel remarkable investor enthusiasm, with shares climbing over 500% in the last 12 months.
Enliven Therapeutics Inc. (ELVN)
Clinical-stage biotech companies can generate exceptional returns when promising drug candidates produce encouraging trial results. That’s the investing thesis behind Enliven Therapeutics, which is building a pipeline of highly targeted cancer treatments. Rather than attacking both healthy and cancerous cells, Enliven develops precision medicines that target specific genetic mutations responsible for tumor growth. This increasingly personalized approach to cancer treatment has become one of the most promising areas of modern medicine and has attracted considerable investor attention. The company’s momentum accelerated after encouraging phase 1 clinical data for its lead drug candidate, ELVN-001. Enliven also strengthened its balance sheet through a successful public stock offering, providing additional capital to fund ongoing clinical development. The company admittedly has little revenue let alone profits, but shares have tripled over the last 12 months because of long-term optimism about the stock.
Erasca Inc. (ERAS)
Another biotechnology stock that’s short on sales but long on potential is Erasca. It, too, has attracted attention by focusing on a unique approach to cancer; namely, therapies targeting the RAS/MAPK signaling pathway. Mutations involving this pathway are responsible for many of the most difficult-to-treat cancers, making it an area of intense interest. Recent share price momentum is jaw-dropping, with more than 1,000% gains for ERAS over the last 12 months to prove how excited Wall Street is about this healthcare startup. Shares are sure to be characterized by continued volatility, but Erasca offers investors an opportunity to participate in cutting-edge cancer research by getting in on the ground floor of this speculative stock.
Iridium Communications Inc. (IRDM)
Reliable communications have become increasingly valuable in a connected world, especially in places where traditional cellular networks simply don’t exist. Iridium Communications has built a unique competitive advantage by operating the world’s only commercial satellite network that provides truly global coverage, including remote oceans, polar regions and other isolated locations beyond the reach of conventional wireless infrastructure. Unlike other stocks on this list, IRDM is comfortably profitable and is posting modest growth on its roughly $1 billion in annual sales. That’s thanks to clients that include government agencies, defense organizations, commercial airlines, shipping companies and more. While satellite communications require substantial capital investment, IRDM is a great opportunity to play life beyond terrestrial cellphone towers and get in on the future of telecom.
[Read: 7 Best Space Stocks and ETFs to Buy in 2026]
Maase Inc. (MAAS)
Maase allows investors to play the Asian side of the AI arms race via a Chinese company at the center of this megatrend. One of the company’s most ambitious initiatives is its “Stars Project,” a multibillion-yuan effort to build intelligent computing centers connected by decentralized edge-computing nodes throughout China. These facilities are designed to support smart cities, industrial automation, data management and other AI-powered services that require significant computing capacity. AI stocks are already volatile, and smaller companies even more so; when you throw in the uncertainty that comes with investing in an overseas company, the volatility jumps even more. However, shares have surged more than 300% over the past 12 months, proving that there may be profits ahead for this admittedly aggressive, high-risk stock.
Sezzle Inc. (SEZL)
“Buy now, pay later” has become one of the fastest-growing segments of digital payments, and Sezzle has emerged as one of the industry’s strongest independent players. The company’s platform allows consumers to split purchases into interest-free installment payments while helping merchants increase sales, improve conversion rates and encourage repeat business. Recent financial performance has been particularly impressive, and strong first-quarter results prompted management to raise its full-year guidance. Right now the company is comfortably profitable and plotting 30% revenue growth in fiscal year 2026 and another 25% in 2027. Shares are up 98% year to date thanks to these strong fundamentals, showing SEZL is a fintech stock that could have staying power.
Twist Bioscience Corp. (TWST)
Twist Bioscience occupies a unique position within the biotechnology industry because it isn’t primarily developing drugs. Instead, it provides the foundational tools that many biotechnology and pharmaceutical companies use to accelerate research and development. The company’s breakthrough technology synthesizes DNA using silicon chips rather than traditional manufacturing techniques. By miniaturizing the chemistry onto semiconductor-style chips, Twist can produce thousands of DNA sequences simultaneously, dramatically lowering costs while improving speed, accuracy and scalability. Additionally, one of Twist’s fastest-growing businesses involves AI-enabled drug discovery. Using its extensive DNA libraries, the company helps pharmaceutical partners identify promising antibody candidates more efficiently, an increasingly valuable capability as artificial intelligence transforms biomedical research. Shares are up more than 300% in the last 12 months, despite the fact that this healthcare innovator is not yet profitable.
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Update 08/13/26: This story was previously published at an earlier date and has been updated with new information.
