Oppenheimer listed 12 of the "best of the best" stocks for investors in the small- and mid-cap sector.
Analysts at the firm selected companies that had a bullish technical trend and were buy-rated.
The companies are opportunities in a market year that's bound to see more volatility, the firm said.
Investors hunting for good deals have a handful of bright opportunities in one corner of the market.
In a new report to clients, Oppenheimer unveiled its list of what it considered to be the best 30 stocks to buy in the small- to mid-cap sector in 2026.
Analysts at the firm selected 30 smid-cap companies that fell into their "highest-conviction" category and were buy-rated. The firm then narrowed that list to 12 "best of the best" stocks, which were stocks that also displayed a bullish technical trend.
"From a technical perspective, current volatility levels show selling pressure is easing, opening room for an oversold bounce over the coming weeks," analysts said, adding that they saw the S&P 500 seeing a "reset" to 6,150 in the middle of the year. "Bottom-up selection should remain in focus," they added.
Here are the firm's "best of the best" investment ideas in the sector:
Modine Manufacturing Co
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Thesis: "We believe Modine's core competencies in thermal management and product innovation, coupled with a clear focus on value creation under the company's 80/20 framework, should drive accretive growth over and beyond our investment horizon. We see multiple catalysts can support positive estimate revisions and multiple re-rating," analysts said.
Sensata Technologies Holding
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Thesis: "Our Outperform rating reflects ongoing operating quality traction, cyclical headwinds rolling off, consistency in FCF conversion profile, and further deleveraging. We think these factors could support at least a 13x target multiple, with real further opportunity if ST can further leverage its strong pedigree in critical components tactically in key growth markets."
Pursuit Attractions and Hospitality Inc.
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Thesis: "We like the fundamentals of the PRSU business as the company owns iconic assets in supply-constrained markets. Recent M&A and ROI projects refreshing current experiences are additional catalysts for growth, in our view. We also forecast continued margin expansion as the company increases prices and leverages its fixed costs on higher revenue."
Madrigal Pharmaceuticals
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Thesis: "MDGL's launch of Rezdiffra for MASH has been outperforming sales expectations driven by strong reception from physicians and payors, as described on the recent 4Q25 update, and we see continued upside potential to current consensus estimates."
Thesis: "We see $1B+ sales potential across initial Qtorin indications, and believe that demonstrated Phase 2 data and clear mechanistic rationale have derisked Qtorin in its current clinical development. We see a clear path to commercial success, with a concentrated launch strategy and high overlap across indications."
Thesis: "The company has ~$593M in cash as of 4Q25 and has multiple catalysts planned for 2026. We believe the market is underappreciating the breadth of Nurix's pipeline and potential for value creation."
Thesis: "We anticipate AXSM's lead drug Auvelity to continue its strong performance following 4Q25 results as we expect increasing uptake and improving payor coverage to drive further growth," analysts said.
"Our model forecasts a 5-year total revenue CAGR of ~50% across AXSM's portfolio, driving potential near-term profitability. We look forward to pipeline readouts in 2026 as the next key catalysts," they later added.
Thesis: "Our thesis is driven by the value of the company's TYK2-targeting portfolio, including both peripherally acting envu and CNS penetrant A-005," analysts said.
Thesis: "While DigitalOcean has already begun delivering positively on its turnaround efforts, rising customer adoption of DOCN's IaaS and PaaS cloud offerings illustrate sustainable and growing spend on the platform that can develop into outperformance for the next few years. Add to that incremental revenue growth from AI inferencing applications that get developed and deployed on DOCN, we can see sustainable >25% revenue growth for multiple years."
Thesis: "We believe WULF is a major beneficiary of the '5th Epoch of Compute,' underscored by unprecedented demand for compute capacity and networking. The company operates in unique geographic locations with low latency to major metropolitan areas in the Northeast and Great Lakes region, and is now adding capacity in the Midwest and Mid-Atlantic."
Thesis: "Onto Innovation (ONTO) remains our top smidcap idea, as the company continues strengthening its AI-driven advanced packaging inspection franchise," analysts said.
"We expect Onto to significantly outgrow the wafer fab equipment (WFE) market long term due to its disproportionate exposure to AI, with tools-of-record in advanced packaging and high-bandwidth memory (HBM)," they later added.
Semtech Corp
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Thesis: "Management has positioned SMTC for growth in DC AI infrastructure, led by active copper cable (ACC) and linear pluggable optics (LPO)," analysts wrote. "In addition to ACC/LPO upside, we estimate the LoRa business and the handset business (proximity sensing, protection) are poised to grow >20% annually."