Three Undiscovered Gems In Canada To Enhance Your Portfolio

The Canadian market has climbed 1.4% in the last 7 days and an impressive 19% over the past year, with earnings forecast to grow by 15% annually. In this thriving environment, identifying stocks with strong growth potential and solid fundamentals can significantly enhance your portfolio's performance.

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	15.28%	7.58%	★★★★★★
Taiga Building Products	NA	6.05%	10.50%	★★★★★★
Amerigo Resources	12.87%	7.49%	12.97%	★★★★★☆
Firan Technology Group	17.91%	3.75%	23.32%	★★★★★☆
Mako Mining	22.90%	38.12%	54.79%	★★★★★☆
Pizza Pizza Royalty	15.66%	3.64%	3.95%	★★★★☆☆
Firm Capital Mortgage Investment	57.73%	9.38%	5.91%	★★★★☆☆
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 44 stocks from our TSX Undiscovered Gems With Strong Fundamentals screener.

Let's uncover some gems from our specialized screener.

Freehold Royalties (TSX:FRU)

Simply Wall St Value Rating: ★★★★☆☆

Overview: Freehold Royalties Ltd. focuses on acquiring and managing royalty interests in crude oil, natural gas, natural gas liquids, and potash properties across Western Canada and the United States, with a market cap of CA$2.12 billion.

Operations: Freehold Royalties Ltd. generates revenue primarily from its oil and gas exploration and production segment, which amounted to CA$323.04 million. The company's market cap stands at CA$2.12 billion.

Freehold Royalties, a small cap Canadian company, reported net income of CAD 39.3 million for Q2 2024, up from CAD 24.26 million the previous year. The firm’s net debt to equity ratio stands at a satisfactory 24.6%, and its interest payments are well covered by EBIT (15.3x). Trading at 57.7% below estimated fair value, Freehold also announced a monthly dividend of CAD 0.09 per share payable on October 15, 2024.

• Dive into the specifics of Freehold Royalties here with our thorough health report.

• Gain insights into Freehold Royalties' past trends and performance with our Past report.

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$1.60 billion.

Operations: Hammond Power Solutions generates revenue primarily from the manufacture and sale of transformers, totaling CA$754.37 million. The company's gross profit margin is a key financial metric to consider.

Hammond Power Solutions (HPS) has shown strong performance with earnings growth of 12.3% over the past year, surpassing the Electrical industry’s 6.5%. The company trades at 38.9% below its estimated fair value and boasts high-quality earnings. HPS's debt to equity ratio has improved significantly from 27.7% to 5% over five years, and interest payments are well covered by EBIT at an impressive 87.6x coverage rate. Recent news includes a quarterly dividend of CAD$0.275 per share payable on September 27, reflecting robust financial health and shareholder returns.

• Take a closer look at Hammond Power Solutions' potential here in our health report.

• Learn about Hammond Power Solutions' historical performance.

Silvercorp Metals (TSX:SVM)

Simply Wall St Value Rating: ★★★★★★

Overview: Silvercorp Metals Inc., with a market cap of CA$1.17 billion, engages in the acquisition, exploration, development, and mining of mineral properties through its subsidiaries.

Operations: Silvercorp Metals generates revenue primarily from its mining operations in Henan Luoning ($200 million) and Guangdong ($27.35 million).

Silvercorp Metals, a Canadian mining company, has shown impressive earnings growth of 149.4% over the past year, far outpacing the industry average of 1.2%. The firm is trading at 90.8% below its estimated fair value and remains debt-free for over five years. Recently, Silvercorp announced a share repurchase program to buy back up to 8.67 million shares by September 2025, aiming to enhance shareholder value by reducing outstanding shares from the current total of approximately 216.77 million.

• Get an in-depth perspective on Silvercorp Metals' performance by reading our health report here.

• Assess Silvercorp Metals' past performance with our detailed historical performance reports.

Summing It All Up

• Reveal the 44 hidden gems among our TSX Undiscovered Gems With Strong Fundamentals screener with a single click 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.
• Maximize your investment potential with Simply Wall St, the comprehensive app that offers global market insights for free.

Contemplating Other Strategies?

• 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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