Stock Analysis

Three Undiscovered Gems with Promising Potential

SHSE:603408
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As global markets navigate choppy waters, with small-cap stocks underperforming and inflation concerns persisting, investors are keenly observing the economic landscape for opportunities. Amidst this backdrop, identifying stocks with strong fundamentals and growth potential becomes crucial, especially in sectors resilient to current market volatility.

Top 10 Undiscovered Gems With Strong Fundamentals

NameDebt To EquityRevenue GrowthEarnings GrowthHealth Rating
Zona Franca de IquiqueNA7.94%12.83%★★★★★★
Eagle Financial Services170.75%12.30%1.92%★★★★★★
Wilson Bank HoldingNA7.87%8.22%★★★★★★
Yuen Foong Yu Consumer Products27.23%0.46%-3.46%★★★★★★
Ovostar Union0.01%10.19%49.85%★★★★★★
Standard Bank0.13%27.78%30.36%★★★★★★
Advancetek EnterpriseLtd56.32%41.67%65.57%★★★★★☆
AJIS0.79%1.12%-12.92%★★★★★☆
Arab Insurance Group (B.S.C.)NA-59.20%20.33%★★★★★☆
Krom Bank IndonesiaNA40.04%35.44%★★★★☆☆

Click here to see the full list of 4628 stocks from our Undiscovered Gems With Strong Fundamentals screener.

Let's explore several standout options from the results in the screener.

Runner (Xiamen) (SHSE:603408)

Simply Wall St Value Rating: ★★★★★★

Overview: Runner (Xiamen) Corp. specializes in the R&D, design, production, and sale of kitchen and bathroom products as well as water purification products both domestically and internationally, with a market cap of CN¥5.81 billion.

Operations: Runner (Xiamen) generates revenue primarily from the sale of kitchen and bathroom products, along with water purification products. The company's gross profit margin currently stands at 28.5%, reflecting its pricing strategy and cost management in these product segments.

Runner (Xiamen) has shown impressive earnings growth of 35.9% over the past year, outpacing the building industry's -8%. The company is trading at a price-to-earnings ratio of 10.9x, which is favorable compared to the broader CN market's 34.1x. It reported sales of CNY 3.78 billion for the first nine months of 2024, up from CNY 3.09 billion in the previous year, with net income rising to CNY 396.6 million from CNY 290.2 million last year. With high-quality earnings and reduced debt-to-equity from 13.5% to 5.6% over five years, Runner seems well-positioned for future growth prospects.

SHSE:603408 Earnings and Revenue Growth as at Jan 2025
SHSE:603408 Earnings and Revenue Growth as at Jan 2025

Shih Her Technologies (TPEX:3551)

Simply Wall St Value Rating: ★★★★★★

Overview: Shih Her Technologies Inc. specializes in precision cleaning and reborn treatment services for manufacturing equipment parts used in the semiconductor, photoelectricity, and solar energy industries, with a market capitalization of NT$8.24 billion.

Operations: The company generates revenue primarily from the Taiwanese region, with NT$2.03 billion attributed to its main operations and additional contributions from Changyu Technology and Yuanguang Technology Co., Ltd. Mainland Area contributes NT$430.11 million, while adjustments and eliminations account for a reduction of NT$91.40 million in total revenue.

Shih Her Technologies, a small player in the semiconductor space, has shown promising growth with earnings increasing by 10.9% over the past year, outpacing the industry's 5.9%. The company reported a significant boost in sales for Q3 2024 at TWD 645.75 million compared to TWD 552.27 million last year, and net income rose to TWD 96.32 million from TWD 66.42 million a year ago. With its debt-to-equity ratio reduced from 23.7% to 14.5% over five years and more cash than total debt, Shih Her appears financially sound despite recent share price volatility.

TPEX:3551 Debt to Equity as at Jan 2025
TPEX:3551 Debt to Equity as at Jan 2025

North Pacific BankLtd (TSE:8524)

Simply Wall St Value Rating: ★★★★☆☆

Overview: North Pacific Bank, Ltd. offers a range of banking products and services to individuals and corporations in Japan, with a market cap of ¥171.84 billion.

Operations: The primary revenue stream for North Pacific Bank, Ltd. is its banking segment, generating ¥112.17 billion, followed by its leasing business at ¥23.99 billion.

North Pacific Bank, with total assets of ¥13.25 trillion and equity of ¥437.5 billion, has been making waves with its impressive earnings growth of 66.6% over the past year, outpacing the industry average of 22.6%. The bank's total deposits stand at ¥10.89 trillion against loans totaling ¥7.48 trillion, reflecting a net interest margin of 0.6%. Despite having an appropriate level of bad loans at 1.2%, it holds a low allowance for these at just 48%. Recently, it increased its dividend to ¥6.50 per share from last year's ¥5, signaling confidence in future prospects.

TSE:8524 Debt to Equity as at Jan 2025
TSE:8524 Debt to Equity as at Jan 2025

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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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