Undiscovered Gems in Canada to Watch This September 2024

The Canadian market has experienced increased volatility recently, with concerns about a slowing economy and persistent inflation sparking pullbacks. Despite these fluctuations, stocks have generally delivered strong gains and remain near record highs. In this environment, identifying undiscovered gems—stocks that offer potential growth despite broader market swings—can be particularly rewarding for investors looking to navigate the current economic landscape.

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%	★★★★★★
Jaguar Mining	1.19%	5.49%	5.12%	★★★★★★
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%	★★★★☆☆
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.

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$1.52 billion.

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

Hammond Power Solutions (HPS) has been making waves with its robust financials and strong growth indicators. Over the past year, earnings grew by 12.3%, surpassing the Electrical industry’s 6.5%. HPS's net income for Q2 2024 was CAD 23.59 million, up from CAD 13.33 million a year earlier, reflecting solid performance with basic EPS at CAD 1.98 compared to CAD 1.12 previously. The company’s debt-to-equity ratio also improved significantly from 27.7% to just 5% over five years, indicating prudent financial management and reduced leverage risks.

• Navigate through the intricacies of Hammond Power Solutions with our comprehensive health report here.

• Examine Hammond Power Solutions' past performance report to understand how it has performed in the past.

Leon's Furniture (TSX:LNF)

Simply Wall St Value Rating: ★★★★★★

Overview: Leon's Furniture Limited, together with its subsidiaries, operates as a retailer of home furnishings, mattresses, appliances, and electronics in Canada and has a market cap of CA$2.04 billion.

Operations: Leon's Furniture generates revenue primarily from the sale of home furnishings, mattresses, appliances, and electronics totaling CA$2.53 billion.

Leon's Furniture, a small cap Canadian retailer, showcases solid financial health with its debt to equity ratio improving from 20.4% to 10.4% over the past five years and EBIT covering interest payments 11.4 times. Recent earnings results for Q2 2024 revealed sales of C$617.66 million and net income of C$30.17 million, up from last year’s figures of C$593.84 million and C$27.42 million respectively, reflecting steady growth in a challenging market environment.

• Click here to discover the nuances of Leon's Furniture with our detailed analytical health report.

• Learn about Leon's Furniture's historical performance.

Silvercorp Metals (TSX:SVM)

Simply Wall St Value Rating: ★★★★★★

Overview: Silvercorp Metals Inc., with a market cap of CA$1.20 billion, engages in the acquisition, exploration, development, and mining of mineral properties through its subsidiaries.

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

Silvercorp Metals, a small-cap player in the mining sector, has outpaced industry growth with earnings surging 149.4% over the past year. The company is debt-free and reported net income of US$21.94 million for Q1 2024 compared to US$9.22 million last year, reflecting robust profitability. Despite significant insider selling recently, Silvercorp remains a good value proposition trading at 90.8% below its estimated fair value and forecasts suggest continued earnings growth of 30.53% annually.

• Unlock comprehensive insights into our analysis of Silvercorp Metals stock in this health report.

• Gain insights into Silvercorp Metals' historical performance by reviewing our past performance report.

Next Steps

• Investigate our full lineup of 44 TSX Undiscovered Gems With Strong Fundamentals right here.
• Are any of these part of your asset mix? Tap into the analytical power of Simply Wall St's portfolio to get a 360-degree view on how they're shaping up.
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Ready To Venture Into Other Investment Styles?

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• 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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