This chapter is from the book
Stock Catalysts
One big reason small caps tend to beat large caps is simply based on scale. If Microsoft, which has $78 billion in annual sales, invents a new widget and sales go up by $100 million, the stock might barely register it. But if egg distributor Cal-Maine (CALM), with $1.3 billion in annual sales, picks up a new customer and grows its sales by $100 million, the stock would likely see a re-evaluation and a jump in its share price.