Exploring 3 Undiscovered Gems To Enhance Your Portfolio

The market has been flat over the last week but is up 23% over the past year, with earnings expected to grow by 15% per annum over the next few years. In this environment, identifying undiscovered gems that can enhance your portfolio often involves finding stocks with strong fundamentals and growth potential.

Top 10 Undiscovered Gems With Strong Fundamentals In The United States

Name	Debt To Equity	Revenue Growth	Earnings Growth	Health Rating
Morris State Bancshares	10.20%	-0.32%	6.73%	★★★★★★
River Financial	122.41%	16.43%	18.50%	★★★★★★
Teekay	NA	-6.48%	55.79%	★★★★★★
Mission Bancorp	25.37%	16.23%	20.16%	★★★★★★
Omega Flex	NA	1.31%	3.88%	★★★★★★
First Northern Community Bancorp	NA	7.12%	10.04%	★★★★★★
Associated Capital Group	NA	-7.78%	8.48%	★★★★★★
Valhi	38.71%	2.57%	-19.76%	★★★★★☆
QDM International	36.42%	107.08%	78.76%	★★★★★☆
FRMO	0.17%	12.99%	23.62%	★★★★☆☆

Click here to see the full list of 217 stocks from our US Undiscovered Gems With Strong Fundamentals screener.

Here's a peek at a few of the choices from the screener.

Republic Bancorp (NasdaqGS:RBCA.A)

Simply Wall St Value Rating: ★★★★★★

Overview: Republic Bancorp, Inc. operates as a bank holding company for Republic Bank & Trust Company, offering diverse banking products and services in the United States with a market cap of $1.25 billion.

Operations: Republic Bancorp generates revenue primarily from its Core Banking segment, which includes Traditional Banking ($223.15 million) and Warehouse Lending ($9.91 million), along with contributions from Republic Processing Group's Tax Refund Solutions ($22.68 million), Republic Credit Solutions ($39.93 million), and Republic Payment Solutions ($17.85 million).

Republic Bancorp, with total assets of US$6.6B and equity of US$955.4M, has deposits totaling US$5.1B and loans amounting to US$5.2B. The net interest margin stands at 4.9%, while bad loans are at a manageable 0.4%. Earnings grew by 10.8% last year, outpacing the industry’s -16.2%. Despite significant insider selling recently, the company repurchased shares worth US$111M since its buyback program began in 2005, indicating confidence from within.

• Get an in-depth perspective on Republic Bancorp's performance by reading our health report here.

• Gain insights into Republic Bancorp's past trends and performance with our Past report.

Hovnanian Enterprises (NYSE:HOV)

Simply Wall St Value Rating: ★★★★★☆

Overview: Hovnanian Enterprises, Inc., with a market cap of approximately $1.39 billion, designs, constructs, markets, and sells residential homes in the United States through its subsidiaries.

Operations: Hovnanian Enterprises generates revenue primarily from its residential home construction and sales operations, with financial services contributing $70.40 million. The company has a segment adjustment of $2.84 billion.

Hovnanian Enterprises has shown significant improvement, with earnings growing 49.2% over the past year, outpacing the Consumer Durables industry. Trading at 74.6% below its estimated fair value, it offers a compelling valuation. The company’s interest payments are well covered by EBIT (8.3x coverage), indicating strong financial health despite a high net debt to equity ratio of 126.8%. Recent earnings reports highlight a revenue increase to US$722.7 million and net income rising to US$72.92 million for Q3 2024 compared to last year’s figures, reflecting robust performance and growth potential.

• Click here and access our complete health analysis report to understand the dynamics of Hovnanian Enterprises.

• Gain insights into Hovnanian Enterprises' historical performance by reviewing our past performance report.

Valhi (NYSE:VHI)

Simply Wall St Value Rating: ★★★★★☆

Overview: Valhi, Inc. operates in the chemicals, component products, and real estate management and development sectors across Europe, North America, the Asia Pacific, and internationally with a market cap of $870.35 million.

Operations: Valhi, Inc. generates revenue primarily from its chemicals segment ($1.78 billion), followed by component products ($157.40 million) and real estate management and development ($78.50 million).

Valhi has shown significant improvement, with net income jumping to US$19.9 million in Q2 2024 from a loss of US$3.2 million the previous year. The earnings per share rose to US$0.70, up from a loss of US$0.11 per share last year. Its debt-to-equity ratio has impressively decreased from 78% to 38.7% over five years, and its interest payments are well covered by EBIT at 4.7x coverage.

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

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

Key Takeaways

• Click through to start exploring the rest of the 214 US Undiscovered Gems With Strong Fundamentals now.
• 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.
• Elevate your portfolio with Simply Wall St, the ultimate app for investors seeking global market coverage.

Contemplating Other Strategies?

• Explore high-performing small cap companies that haven't yet garnered significant analyst attention.
• Fuel your portfolio with companies showing strong growth potential, backed by optimistic outlooks both from analysts and management.
• 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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