Discovering 3 Promising Small Caps with Strong Foundations

As global markets experience broad-based gains, with smaller-cap indexes outperforming large-caps and key U.S. indices approaching record highs, the spotlight turns to small-cap stocks that often thrive in such dynamic environments. In this context, identifying small-cap companies with robust foundations becomes crucial, as these firms can offer unique opportunities for growth amidst economic indicators like strong labor markets and stabilizing mortgage rates.

Top 10 Undiscovered Gems With Strong Fundamentals

Name	Debt To Equity	Revenue Growth	Earnings Growth	Health Rating
SALUS Ljubljana d. d	13.55%	13.11%	9.95%	★★★★★★
Mobile Telecommunications	NA	4.98%	0.14%	★★★★★★
Impellam Group	31.12%	-5.43%	-6.86%	★★★★★★
Ovostar Union	0.01%	10.19%	49.85%	★★★★★★
Tianyun International Holdings	10.09%	-5.59%	-9.92%	★★★★★★
Watt's	73.27%	7.85%	-1.33%	★★★★★☆
MAPFRE Middlesea	NA	14.56%	1.77%	★★★★★☆
Arab Banking Corporation (B.S.C.)	213.15%	18.58%	29.63%	★★★★☆☆
A2B Australia	15.83%	-7.78%	25.44%	★★★★☆☆
Wilson	64.79%	30.09%	68.29%	★★★★☆☆

Click here to see the full list of 4636 stocks from our Undiscovered Gems With Strong Fundamentals screener.

Underneath we present a selection of stocks filtered out by our screen.

Qinghai Jinrui Mineral Development (SHSE:600714)

Simply Wall St Value Rating: ★★★★★★

Overview: Qinghai Jinrui Mineral Development Co., Ltd specializes in the production and sale of strontium salt products, with a market capitalization of CN¥2.76 billion.

Operations: Qinghai Jinrui generates revenue primarily from the chemical industry, amounting to CN¥341.06 million.

Qinghai Jinrui Mineral Development, a small player in the industry, has shown impressive financial performance recently. The company reported net income of CNY 24.04 million for the nine months ending September 2024, up from CNY 10.01 million the previous year. Earnings per share increased to CNY 0.083 from CNY 0.035, reflecting solid growth despite significant one-off gains of CN¥5.8M impacting results over the last year. With earnings growth at a remarkable 253%, far outpacing the Oil and Gas industry's -16% trend, Qinghai Jinrui appears to be on a strong upward trajectory without any debt burden to hinder its progress.

• Delve into the full analysis health report here for a deeper understanding of Qinghai Jinrui Mineral Development.

• Review our historical performance report to gain insights into Qinghai Jinrui Mineral Development's's past performance.

Cohen Development Gas & Oil (TASE:CDEV)

Simply Wall St Value Rating: ★★★★★★

Overview: Cohen Development Gas & Oil Ltd. focuses on the exploration, development, and production of oil and natural gas properties, with a market capitalization of ₪912.46 million.

Operations: Cohen Development Gas & Oil generates revenue primarily from the production and management of oil and gas exploration, totaling $28.11 million.

Cohen Development Gas & Oil, a nimble player in the industry, has been navigating through some challenges and opportunities. Despite a negative earnings growth of 2.1%, which falls short compared to the industry's 6.2% average, the company remains debt-free for five years—a notable strength in its financial health. Its net income for Q2 was US$4.7 million, up from US$4.3 million last year, with basic earnings per share at US$0.73 from continuing operations. Trading at 35% below estimated fair value suggests potential upside if market conditions align favorably with its high-quality past earnings record.

• Click here and access our complete health analysis report to understand the dynamics of Cohen Development Gas & Oil.

• Evaluate Cohen Development Gas & Oil's historical performance by accessing our past performance report.

Chin-Poon Industrial (TWSE:2355)

Simply Wall St Value Rating: ★★★★★★

Overview: Chin-Poon Industrial Co., Ltd. is involved in the manufacturing, processing, and selling of printed circuit boards (PCBs) and electronic materials across various international markets including Taiwan, the United States, Germany, Japan, Hungary, Romania, and China with a market cap of NT$15.84 billion.

Operations: The company generates revenue primarily from Taiwan and Mainland China, with figures of NT$13.04 billion and NT$5.98 billion, respectively.

Chin-Poon Industrial, a notable player in the electronics sector, showcases strong financial health with earnings growth of 53.5% over the past year, outpacing the industry average of 9%. The company's price-to-earnings ratio stands at 14.1x, offering good value compared to Taiwan's market average of 21.2x. Recent figures reveal a net income for Q3 at TWD 262 million against TWD 360 million last year; however, nine-month net income rose to TWD 926 million from TWD 565 million previously. With free cash flow positive and debt levels reduced significantly over five years, its financial stability is evident despite recent executive changes impacting leadership dynamics.

• Navigate through the intricacies of Chin-Poon Industrial with our comprehensive health report here.

• Explore historical data to track Chin-Poon Industrial's performance over time in our Past section.

Next Steps

• Click this link to deep-dive into the 4636 companies within our Undiscovered Gems With Strong Fundamentals screener.
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Seeking Other Investments?

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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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