Undiscovered Gems In Canada To Watch This September 2024

Over the last 7 days, the Canadian market has remained flat, but it is up 13% over the past year with earnings forecasted to grow by 15% annually. In this context, identifying stocks with strong growth potential and solid fundamentals can be particularly rewarding for investors.

Top 10 Undiscovered Gems With Strong Fundamentals In Canada

Name	Debt To Equity	Revenue Growth	Earnings Growth	Health Rating
TWC Enterprises	6.74%	10.99%	25.68%	★★★★★★
Reconnaissance Energy Africa	NA	43.44%	3.74%	★★★★★★
Taiga Building Products	NA	6.05%	10.50%	★★★★★★
Tornado Global Hydrovacs	14.62%	24.52%	64.90%	★★★★★☆
Tenaz Energy	NA	33.64%	50.62%	★★★★★☆
Mako Mining	22.90%	38.12%	54.79%	★★★★★☆
Firan Technology Group	17.91%	3.75%	23.32%	★★★★★☆
Pizza Pizza Royalty	15.66%	3.64%	3.95%	★★★★☆☆
Queen's Road Capital Investment	7.20%	22.14%	22.20%	★★★★☆☆
Genesis Land Development	53.32%	25.58%	47.05%	★★★★☆☆

Click here to see the full list of 46 stocks from our TSX Undiscovered Gems With Strong Fundamentals screener.

We're going to check out a few of the best picks from our screener tool.

Cipher Pharmaceuticals (TSX:CPH)

Simply Wall St Value Rating: ★★★★★★

Overview: Cipher Pharmaceuticals Inc. operates as a specialty pharmaceutical company in Canada with a market cap of CA$485.93 million.

Operations: Cipher Pharmaceuticals generates revenue primarily from its Specialty Pharmaceuticals segment, which reported CA$22.16 million. The company has a market cap of CA$485.93 million.

Cipher Pharmaceuticals has shown resilience despite recent challenges, with earnings forecast to grow 3.81% annually. The company is debt-free, a significant improvement from five years ago when its debt-to-equity ratio was 50.1%. Trading at 52.6% below its estimated fair value, Cipher appears undervalued compared to industry peers. Recent financials reveal net income of US$7.92 million for the first half of 2024, up from US$5.7 million last year, signaling robust performance amid industry-wide struggles.

• Click here to discover the nuances of Cipher Pharmaceuticals with our detailed analytical health report.

• Review our historical performance report to gain insights into Cipher Pharmaceuticals''s past performance.

Hammond Power Solutions (TSX:HPS.A)

Simply Wall St Value Rating: ★★★★★★

Overview: Hammond Power Solutions Inc., along with its subsidiaries, designs, manufactures, and sells various transformers across Canada, the United States, Mexico, and India with a market cap of CA$1.49 billion.

Operations: Hammond Power Solutions generates CA$754.37 million in revenue primarily from the manufacture and sale of transformers.

Hammond Power Solutions (HPS) has seen notable growth, with earnings increasing by 12.3% over the past year, surpassing the Electrical industry’s 6.5%. The company reported Q2 sales of CAD 197.21 million and net income of CAD 23.59 million, up from CAD 172.45 million and CAD 13.33 million respectively a year ago. HPS's debt to equity ratio dropped significantly from 27.7% to just 5% over five years, indicating improved financial health while trading at a substantial discount of approximately 46% below its estimated fair value.

• Unlock comprehensive insights into our analysis of Hammond Power Solutions stock in this health report.

• Assess Hammond Power Solutions' past performance with our detailed historical performance reports.

TerraVest Industries (TSX:TVK)

Simply Wall St Value Rating: ★★★★★☆

Overview: TerraVest Industries Inc. manufactures and sells goods and services to energy, agriculture, mining, transportation, and other markets in Canada and the United States, with a market cap of CA$1.89 billion.

Operations: TerraVest Industries generates revenue primarily from its HVAC and Containment Equipment segment (CA$292.90 million), followed by Compressed Gas Equipment (CA$243.77 million), Service (CA$201.78 million), and Processing Equipment (CA$117.58 million). The Corporate segment incurs a loss of CA$0.93 million, impacting overall profitability.

TerraVest Industries has shown impressive growth, with earnings surging by 43.6% over the past year and surpassing the Energy Services industry’s -4.7%. The company’s debt to equity ratio has improved from 117.9% to 49.4% in five years, though net debt to equity remains high at 42.3%. Recent results highlight revenue of CAD 238 million for Q3, up from CAD 150 million a year ago, and net income rising to CAD 11.92 million from CAD 7.97 million last year.

• Dive into the specifics of TerraVest Industries here with our thorough health report.

• Evaluate TerraVest Industries' historical performance by accessing our past performance report.

Summing It All Up

• Explore the 46 names from our TSX Undiscovered Gems With Strong Fundamentals screener here.
• Are you invested in these stocks already? Keep abreast of every twist and turn by setting up a portfolio with Simply Wall St, where we make it simple for investors like you to stay informed and proactive.
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Interested In Other Possibilities?

• Explore high-performing small cap companies that haven't yet garnered significant analyst attention.
• Fuel your portfolio with companies showing strong growth potential, backed by optimistic outlooks both from analysts and management.
• Find companies with promising cash flow potential yet trading below their fair value.

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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