A company's stock price doesn't fully represent its size -- that's determined by its market cap: the price of each share multiplied by the number of shares outstanding. But smaller stocks are often more comfortable bets for investors who don't have a huge amount of money to put into the stock market, or want to get in on the ground floor of an exciting growth opportunity. Limelight Networks (EGIO 0.54%) and Sirius XM (SIRI 8.88%) are two top stocks trading under $10, and they both boast convincing competitive advantages in their respective industries. Let's dig a little bit deeper to find out why you should consider adding these companies to your portfolio. 

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Limelight Networks: A small-cap growth opportunity

Limelight Networks operates a global content delivery network that helps clients distribute digital media to consumers through the internet. With a current price of $5.31 per share and a market cap of $648 million, Limelight is a small-cap stock. But it has big potential because of its strong focus on video services -- an addressable market that is heating up as more media companies launch direct-to-consumer (streaming) platforms. 

Comcast's NBCUniversal launched Peacock to cable subscribers in April, and AT&T's Warner Media launched HBO Max in May. According to Limelight CEO Robert Lento, his company's involvement in these debuts helped lead to strong traffic in the second quarter. And Lento believes that Limelight is set up for reliable long-term growth as these streaming platforms scale. 

Limelight reported $58.55 million in revenue in the second quarter, up 28% from the prior-year period. The company also dramatically reduced its operating loss from $6.97 million to $1.21 million by keeping expenses in check even as revenue rose, and lowering its R&D budget from $6.01 million to $5.57 million year over year. The company reported adjusted EBITDA of $9.7 million in the second quarter, up from $1.4 million in the prior-year period.   

Limelight is targeting a 15% annual growth over the long term. And the company is working hard to maintain its competitive advantage by investing in edge computing -- a technology that involves placing the machines that manage and deliver data as close as possible to the machines sending out that data to reduce bandwidth costs and boost speed and latency. Limelight is rolling out its EdgeFunctions serverless computing platform in the third quarter, which could help it better serve the needs of its video delivery clients. 

Sirius XM: A large-cap industry leader

Sirius XM is proof that a low stock price doesn't always mean a small company. Despite trading at just $5.64 per share at the time of writing, Sirius enjoys a virtual monopoly over the satellite radio industry in the U.S. with a 77% penetration rate in new cars. The company has a market cap of roughly $24 billion, which puts it firmly in large-cap territory

Sirius faced some coronavirus-related challenges in the second quarter. Total revenue fell 5.2% to $1.87 billion because of a 34% decline in the company's advertising sales -- which generate most of their revenue from the Pandora music platform acquired for $3.5 billion in 2018. According to CEO Jim Meyer, Sirius's battered advertising business posted shrinking year-over-year losses for each successive month in the quarter, but the outlook for this revenue stream remains uncertain for the rest of the year. 

Despite the headwinds facing Pandora, management reiterated a solid outlook for Sirius's core subscription-based satellite radio business. That's good news for investors who want a stock that can hold its own in a tough macroeconomic environment. 

Sirius expects to add 700,000 net self-pay subscribers -- breaking its previous 10-year streak of adding 1 million or more subscribers each year -- and generate revenue of $7.7 billion in the full year of 2020. The company also projects an adjusted EBITDA of $2.4 billion and a free cash flow of up to $1.6 billion in the period. This is only slightly below last year's revenue and EBITDA, which were $7.8 billion and $2.4 billion, respectively. The guidance is impressive considering the headwinds Sirius faces in its advertising business this yearand the cash will help Sirius continue returning value to shareholders through buybacks.

The board of directors authorized another $2 billion in share buybacks in July, bringing the total authorized to $16 billion since the program's inception. 

Two small stocks with big potential 

Limelight Networks and Sirius XM both trade under $10 a share, but that's where most of the similarities end. While Limelight is a small-cap company fighting for market share in the CDN and edge computing industries, Sirius XM is a large-cap industry leader that has already established a dominant position in the much more mature market for satellite radio. 

While both companies have convincing plans for continued success, Limelight is more suitable for investors who want the potential for market-beating stock price growth because of the growing popularity of video streaming and edge computing, while Sirius is ideal for investors who prioritize stable profits and the potential for value to be returned through buybacks and dividend growth.