Small/Mid Cap Strategy: SMID cap theme screens

Research evidence excerpt

Small/Mid Cap Strategy: SMID cap theme screens

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Small/Mid Cap Strategy

SMID cap theme screens

Small Cap

Theme screens on the back of our 2026 SMID Cap Primer 28 May 2026

Following the publication of our 5th annual SMID Cap Primer, we publish screens that Small/Mid Cap Research

align with themes in our work/primer as well as topical/commonly-requested screens. United States

Inexpensive small caps with accelerating fundamentals: Small cap earnings are Jill Carey Hall, CFA Equity & Quant Strategist

expected to see a big acceleration in 2H26, and Value stocks typically outperform when BofAS

profits recover. We screen for inexpensive small caps with positive revisions and +1jill.carey@bofa.com646 855 3327

improving growth. We also highlighted in our primer that estimate revisions have been Trey Brown

one of the best all-weather factors in small caps historically. Equity & Quant Strategist

BofAS

SMID caps talking about AI the most: AI mentions on SMID earnings calls continue to +1 646 855 2689 harold.brown2@bofa.com

accelerate. And as a group, SMID caps talking about AI the most are trading at cheaper

valuations vs. large caps mentioning AI the most and vs. their sector peers, including if

we limit to Buy-rated SMIDs. Screen of SMIDs with the most AI mentions inside.

Stocks for stagflation risk: We screen for Russell 2000 stocks that rank well on

factors which have historically outperformed in stagflationary backdrops.

Potential M&A candidates: M&A has remained elevated in 2026, particularly in areas

like Health Care. We update our potential M&A candidate screens.

Capex beneficiaries: Small caps’ sales are highly correlated with capex and we see the

case for a sustained and broadening US capex cycle. We screen for stocks with the