Exploring 3 Undiscovered Gems in Sweden with Solid Foundations

As global markets react to the recent Federal Reserve rate cuts, small-cap indices have shown promising performance, although they remain below their historical peaks. Amid this backdrop, Sweden's market offers intriguing opportunities for investors seeking solid foundations in undiscovered gems. In today's environment, a good stock typically exhibits strong fundamentals and resilience to broader market fluctuations.

Top 10 Undiscovered Gems With Strong Fundamentals In Sweden

Name	Debt To Equity	Revenue Growth	Earnings Growth	Health Rating
Softronic	NA	3.58%	7.41%	★★★★★★
Bahnhof	NA	9.02%	15.02%	★★★★★★
AB Traction	NA	5.38%	5.19%	★★★★★★
Firefly	NA	16.04%	32.29%	★★★★★★
AQ Group	7.30%	14.89%	22.26%	★★★★★★
Creades	NA	-28.54%	-27.09%	★★★★★★
Svolder	NA	-22.68%	-24.17%	★★★★★★
Byggmästare Anders J Ahlström Holding	NA	30.31%	-9.00%	★★★★★★
Linc	NA	56.01%	0.54%	★★★★★★
Solid Försäkringsaktiebolag	NA	7.64%	28.44%	★★★★☆☆

Click here to see the full list of 59 stocks from our Swedish Undiscovered Gems With Strong Fundamentals screener.

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

Clas Ohlson (OM:CLAS B)

Simply Wall St Value Rating: ★★★★★★

Overview: Clas Ohlson AB (publ) is a retail company that sells hardware, electrical, multimedia, home, and leisure products in Sweden, Norway, Finland, and internationally with a market cap of SEK10.53 billion.

Operations: Clas Ohlson AB (publ) generates revenue primarily through its retail segment, which amounted to SEK10.66 billion. The company's net profit margin was 3.5%.

With earnings growth of 281.8% over the past year, Clas Ohlson has outpaced the Specialty Retail industry’s 21%. The company is debt-free, a significant improvement from a debt-to-equity ratio of 6.5% five years ago. Trading at 65.6% below its estimated fair value, it offers good relative value compared to peers and industry standards. Recent first-quarter results showed sales of SEK 2.62 billion and net income of SEK 145.8 million, reversing last year's loss.

• Navigate through the intricacies of Clas Ohlson with our comprehensive health report here.

• Understand Clas Ohlson's track record by examining our Past report.

Duni (OM:DUNI)

Simply Wall St Value Rating: ★★★★★★

Overview: Duni AB (publ) develops, manufactures, and sells concepts and products for the serving, take-away, and packaging of meals in Sweden and internationally with a market cap of approximately SEK4.84 billion.

Operations: Duni generates revenue primarily from dining solutions (SEK 4.52 billion) and food packaging solutions (SEK 3.05 billion).

Duni has shown strong financial health, with earnings growing 23% annually over the past five years and a debt-to-equity ratio decreasing from 60.7% to 29.3%. The company’s EBIT covers interest payments by 11.2 times, indicating robust profitability. Despite recent earnings of SEK 81 million for Q2 being lower than last year’s SEK 104 million, Duni is trading at nearly half its estimated fair value and continues to generate positive free cash flow.

• Click here to discover the nuances of Duni with our detailed analytical health report.

• Review our historical performance report to gain insights into Duni's's past performance.

Hoist Finance (OM:HOFI)

Simply Wall St Value Rating: ★★★★☆☆

Overview: Hoist Finance AB (publ) is a credit market company that focuses on loan acquisition and management operations across Europe, with a market cap of SEK7.49 billion.

Operations: Hoist Finance generates revenue primarily from its secured and unsecured loan segments, contributing SEK 821 million and SEK 2.86 billion respectively. The company's net profit margin is a key financial metric to consider for evaluating profitability.

Hoist Finance has shown impressive earnings growth of 210.8% over the past year, significantly outpacing the Consumer Finance industry’s -2.1%. With a price-to-earnings ratio of 9x, it is attractively valued compared to the Swedish market average of 23.7x. Despite its high net debt to equity ratio at 96.8%, Hoist repurchased up to SEK 100 million worth of shares in July and August, reflecting confidence in its capital structure management and future prospects.

• Unlock comprehensive insights into our analysis of Hoist Finance stock in this health report.

• Examine Hoist Finance's past performance report to understand how it has performed in the past.

Next Steps

• Click through to start exploring the rest of the 56 Swedish Undiscovered Gems With Strong Fundamentals now.
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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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