Stock Analysis

Spotlighting December 2024's Undiscovered Gems with Strong Potential

SHSE:603701
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As global markets continue to reach record highs, with the Russell 2000 Index hitting an intraday peak, small-cap stocks are gaining renewed attention amidst a backdrop of evolving domestic policies and geopolitical developments. In this dynamic environment, identifying stocks with strong fundamentals and resilience to external shocks becomes crucial for investors seeking potential opportunities among lesser-known companies.

Top 10 Undiscovered Gems With Strong Fundamentals

NameDebt To EquityRevenue GrowthEarnings GrowthHealth Rating
Bahrain National Holding Company B.S.CNA20.11%5.44%★★★★★★
Parker Drilling46.25%-0.33%53.04%★★★★★★
Impellam Group31.12%-5.43%-6.86%★★★★★★
Ovostar Union0.01%10.19%49.85%★★★★★★
National Corporation for Tourism and Hotels15.72%-3.47%-13.16%★★★★★★
Tianyun International Holdings10.09%-5.59%-9.92%★★★★★★
Inverfal PerúA31.20%10.56%17.83%★★★★★☆
Wilson64.79%30.09%68.29%★★★★☆☆
A2B Australia15.83%-7.78%25.44%★★★★☆☆
PracticNA3.63%6.85%★★★★☆☆

Click here to see the full list of 4642 stocks from our Undiscovered Gems With Strong Fundamentals screener.

Let's uncover some gems from our specialized screener.

Changzheng Engineering TechnologyLtd (SHSE:603698)

Simply Wall St Value Rating: ★★★★☆☆

Overview: Changzheng Engineering Technology Co., Ltd specializes in R&D, engineering design, technical services, equipment supply, and EPC contracting for aerospace pulverized coal pressurized gasification technology and equipment in China, with a market cap of CN¥9.60 billion.

Operations: The company generates revenue primarily from its services in research and development, engineering design, technical services, equipment supply, and EPC general engineering contracting. It operates within the aerospace pulverized coal pressurized gasification technology sector in China. The financial performance is reflected in its market capitalization of CN¥9.60 billion.

Changzheng Engineering Technology Ltd, a nimble player in the energy services sector, has demonstrated robust earnings growth of 23.3% over the past year, outpacing the industry average of 7.6%. The company's debt-to-equity ratio rose to 20.5% over five years, indicating increased leverage but remains manageable given its profitability and cash surplus over total debt. Recent financials show sales at CNY 1.67 billion with net income climbing to CNY 127.57 million from CNY 101.12 million a year prior, reflecting solid operational performance despite not being free cash flow positive currently due to high non-cash earnings levels.

SHSE:603698 Debt to Equity as at Dec 2024
SHSE:603698 Debt to Equity as at Dec 2024

Zhejiang Dehong Automotive Electronic & Electrical (SHSE:603701)

Simply Wall St Value Rating: ★★★★★☆

Overview: Zhejiang Dehong Automotive Electronic & Electrical Co., Ltd. specializes in the production of automotive electronic and electrical components, with a market capitalization of CN¥4.05 billion.

Operations: Zhejiang Dehong derives its revenue primarily from the sale of automotive electronic and electrical components. The company's financial performance is influenced by its ability to manage production costs effectively, impacting its overall profitability.

Zhejiang Dehong, an intriguing player in the automotive electronics sector, has demonstrated a solid performance with earnings growth of 55% over the past year, outpacing the industry average of 10.5%. Despite this impressive growth, its earnings have declined by 30.5% annually over five years. The company's financial health appears robust as it holds more cash than total debt and maintains high-quality earnings with interest coverage not being a concern. Recent reports show sales reached CNY 487 million for nine months ending September 2024, up from CNY 440 million last year, reflecting steady revenue improvement.

SHSE:603701 Earnings and Revenue Growth as at Dec 2024
SHSE:603701 Earnings and Revenue Growth as at Dec 2024

GDH Supertime Group (SZSE:001338)

Simply Wall St Value Rating: ★★★★★☆

Overview: GDH Supertime Group Company Limited focuses on the development, production, and sale of malt to beer manufacturers in China, with a market capitalization of CN¥5.62 billion.

Operations: GDH Supertime Group's primary revenue stream comes from its beer-making segment, generating CN¥4.15 billion. The company's market capitalization is approximately CN¥5.62 billion, reflecting its significant role in the malt production industry for beer manufacturers in China.

GDH Supertime Group, a relatively small player in its field, has seen impressive earnings growth of 65% over the past year, outpacing the Beverage industry's 16%. Despite a rising debt to equity ratio from 1% to 11.2% over five years, it maintains more cash than total debt and boasts high-quality earnings. Trading at nearly 87% below estimated fair value suggests potential undervaluation. Recent financial results highlight net income of CNY 219.73 million for nine months ending September 2024, up from CNY 125.22 million last year, although revenue dipped to CNY 3,312.09 million from CNY 3,754.6 million previously.

SZSE:001338 Debt to Equity as at Dec 2024
SZSE:001338 Debt to Equity as at Dec 2024

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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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