Get Ready for Growth in 2026 With These 2 Small-Cap Standouts

Small-cap companies have the potential to deliver significant returns in the long run, as they can expand faster than large, established firms. At the same time, this growth potential comes with added risk.

These stocks are more sensitive to changes in market sentiment, economic conditions, and company-specific news. As a result, their share prices can be far more volatile than those of blue-chip stocks. This makes careful selection especially important.

Therefore, Canadians should focus on small-cap companies with solid fundamentals, a proven business model, and strong management. When chosen carefully, small-cap stocks can be a rewarding part of a diversified portfolio.

With this background, here are two small-cap TSX stocks for Canadians looking for growth in 2026.

Small-cap stock #1: Enerflex

Investors looking for compelling small-cap stocks for 2026 could consider Enerflex (TSX:EFX). It provides a broad range of energy infrastructure and energy transition solutions. It is well-positioned to deliver strong growth, led by the ongoing momentum in its Energy Infrastructure segment. This business generates recurring revenue through long-term contracts, providing reliable cash flow and strong visibility.

Enerflex’s Engineered Systems division complements this core segment by delivering customized modular solutions supported by a robust order backlog. In addition, its Aftermarket Services business benefits from consistent demand for maintenance, replacement parts, and ongoing support.

Enerflex’s business momentum remains encouraging. In the U.S., rising Permian Basin natural gas output continues to support high utilization rates, and the company plans to expand its compression fleet through 2026. Strong relationships with midstream partners and a healthy project pipeline further support growth.

Enerflex’s focus on enhancing profitability, reducing debt, and generating higher free cash flow positions it well to deliver attractive long-term returns.  Moreover, demand for natural gas and water treatment solutions continues to grow, providing a solid platform for growth.

Small-cap stock #2: 5N Plus

5N Plus (TSX:VNP) is an attractive small-cap stock to consider for 2026. The company is a leading supplier of specialty semiconductors and high-performance materials used in fast-growing, high-value markets such as renewable energy, space satellites, medical imaging, pharmaceuticals, healthcare, and industrial applications. As these industries expand, demand for the advanced materials produced by 5N Plus continues to rise, supporting a strong long-term growth outlook.

Notably, the company’s Specialty Semiconductors division continues to see solid demand from terrestrial renewable energy and space solar power. The demand from the renewable energy sector remains robust, and the company is delivering higher volumes to a key strategic customer under a new and expanded supply agreement. Under the revised terms, semiconductor compound supply volumes are expected to increase by roughly 33% above initial contract levels during 2025–2026, followed by a further 25% increase over the next two years.

In space power, 5N Plus is set to gain from the long-term project pipeline. Meanwhile, it is ramping up its solar cell production and exploring additional expansion opportunities. Further, VNP’s leadership in high-purity materials outside China further strengthens its appeal as global supply chains seek secure, diversified sourcing.

Overall, 5N Plus is a compelling long-term stock, thanks to its solid growth prospects.

The post Get Ready for Growth in 2026 With These 2 Small-Cap Standouts appeared first on The Motley Fool Canada.

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More reading

• Best TSX Stocks Under $50 to Buy Now
• Invest for Tomorrow: 3 TSX Stocks to Build Lasting Wealth
• Looking Forward to 2026? 1 TSX30 Winner to Buy and 1 to Skip
• Where to Invest $5,000 in 2026?
• 3 No-Brainer TSX Stocks to Buy With $500

Fool contributor Sneha Nahata has no position in any of the stocks mentioned. The Motley Fool recommends Enerflex. The Motley Fool has a disclosure policy.