Big things come in small packages and these three top Russell 2000 stocks are small-caps on their way to mid-cap status. There are strong tailwinds behind them pushing them forward. Although their stocks are enjoying strong gains, each has the opportunity to pad their lead even more.

So far this year the small-cap Russell 2000 index is flat compared to where it started 2024. It has only added half the gains of the S&P 500 over the past year. But as economic conditions improve to allow the Federal Reserve to cut interest rates, look for small-cap stocks to gain supremacy.

That’s because small-caps are hit harder by high interest rates than their larger brethren. Because they are more constrained in their ability to access financing, the higher borrowing costs forcefully affect their bottom line. That could change by year’s end and bring with it the promise of more rate cuts to come in 2025.

The three top Russell 2000 stocks below are already sitting pretty in challenging conditions. Put a better financial environment in front of them and this may just be a portent of what they can achieve.

ABM Industries (ABM)

Janitorial and building maintenance services seems like just the sort of business investing legend Peter Lynch would like. He advocated buying boring, under-the-radar stocks the market ignored. ABM Industries (NYSE:ABM) fits the bill.

After languishing since the pandemic when buildings and facilities were shut down, ABM is on the road to recovery and recently hit a new all-time high. Although its business may seem far removed from the rigors and excitement of artificial intelligence, it just found a way to capitalize on the technology’s growth and proliferation. 

ABM just announced the acquisition of Quality Uptime Services for $119 million. The business provides uninterrupted power supply system (UPS) maintenance and UPS battery maintenance for data centers and similar facilities across the country. Because of AI’s demands on data center capacity, there is a massive build-out underway for the industry.

U.S. data center demand will grow 10% annually through 2030 with construction hitting $49 billion, according to McKinsey & Company. Yet with hyperscalers forecast to expand 20% annually, that outlook could be conservative.

ABM stock is up 13% this year and 19% over the past 12 months. Trading at 12 times earnings and estimates and going for a deeply discounted 11 times free cash flow (FCF), the janitorial and maintenance services company offers a bargain-basement valuation for this sleepy growth stock.

Coeur Mining (CDE)

There is gold to be mined in the top Russell 2000 stocks and Coeur Mining (NYSE:CDE) gives you actual nuggets to buy. The precious metals miner has 3.2 million ounces of proven and probable gold reserves and almost 244 million ounces of silver reserves across its North American mines. Although it missed analyst expectations on revenue and profits in the first quarter, it is ready to ramp up production which should see it glitter in the year ahead and beyond.

Coeur achieved commercial production at its Rochester, Nevada mine at the end of the quarter. Costs of finishing the expansion project, however, caused the miner to report a GAAP net loss from continuing operations of $29 million, or 8 cents per share. However, production levels are expected to increase over the rest of the year, due almost wholly to the ramp-up at Rochester.

Prices for gold and silver are elevated. They go for $2,360 per ounce for gold and over $30 per ounce for silver. Coeur Mining stock is now at an all-time high of $6 per share and continuing to expand. 

Ensign Group (ENSG)

Skilled nursing facility specialist Ensign Group (NASDAQ:ENSG) is the third top Russell 2000 stock to buy now. It is a leading operator in the space with 302 healthcare facilities, including 27 senior living operations, across 14 states. But Ensign is on a growth-by-acquisition trajectory.

While that can quickly scale up a business, it does carry risks. Buying up competitors isn’t a problem until it is. An addition may not perform well and diverts management’s attention from its core operations. So far, though, Ensign has proved adept at integrating its acquisitions into its business. Particularly with the sort of low-quality facilities it acquires.

Yet that is also what sets Ensign apart. It buys these one- and two-star-rated nursing care operations and then upgrades them. So despite just 44% of its facilities earning four or five stars, it is a process that will eventually see them improve.

Shares of ENSG also just recently hit a new record high. Although the stock is premium priced across various metrics including price-to-earnings, sales and free cash flow, it is a solid company worth the price. 

On the date of publication, Rich Duprey held a LONG position in ABM stock. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.

On the date of publication, the responsible editor did not have (either directly or indirectly) any positions in the securities mentioned in this article.