It looks like small cap stocks are having another incredible year.

Since mid-March 2017 lows, the Russell 2000 tacked on 5% of upside, while the S&P 500 gained just 3% -- thanks in part to an incredible broader market rally and Donald Trump’s plans to slash the corporate tax rate to just 15%.

They’ve become a barometer of Trump enthusiasm, if you will.

In fact, the more enthused the market becomes about the possibility of a tax cut, the higher small cap stocks trend.  At the moment, small cap companies see a tax rate of 32%, as compared to 26% for S&P 500 companies.  

That’s because they have less exposure to international tax havens.  However, should Trump be successful in reducing the corporate tax rates to 15%, small cap stocks have the most to gain.

One of those stocks could very well be EnviroStar (EVI) – a stock recommended by The Cheap Investor at just $1.57 in June 2013.  It hit a February 2017 high of $25 for a potential gain of 1,492%.  Subscribers that followed our advice and bought at $1.57 saw a $5,000 investment soar to just under $80,000!

Envirostart Inc (EVI)

As usual, we spotted the opportunity others were missing. 

At $1.57, most traders weren’t interested in EnviroStar, despite the fact that quarterly revenue had soared 29.4% to $6.44 million year over year.  Net income had skyrocketed 713% to $125,155, or two cents a share from $15,396 year over year.

Yet, investors foolishly ignored it.  We didn’t, though.  And neither did our readers who watched the stock soar to a high of $25 in less than four years.

The stock is still hot.  For the second quarter of 2016, EnviroStar posted revenue of $33.39 million, or $0.13 a share from $0.05 year over year.  Net income was $1.329 million, up from $379,000 over the same period the previous year.

Over its six-month period, revenues were up to $42.87 million from $14.86 million.  Net Income jumped to $1.68 million from $536,000.  That’s incredible growth.

It proves that proper due diligence can pay off very well.  A 1,492% gain is what dreams are made of.

Are you seeing similar gains, as we are in The Cheap Investor?