Discover these 3 undiscovered gems to boost your wallet

As global markets struggle with mixed performance and economic indicators show a resilient American consumer amid chilly job markets, investors are increasingly looking for opportunities in less conventional areas to bolster their portfolios. In this context, small-cap stocks can offer exceptional growth potential, especially when they are undiscovered gems with solid fundamentals and promising prospects.

10 Undiscovered Gems With Strong Foundations

Click here to see the full list of 4,856 stocks in our scanner of undiscovered gems with strong fundamentals.

We’ll take a look at some of the top picks from our selection tool.

Simply Wall St Value Rating: ★★★★★☆

Review: Emaar Misr for Development Company (SAE) operates in the real estate and project development sector in Egypt and has a market capitalization of EGP 36.14 billion.

Operations: Emaar Misr for Development generates revenues mainly from the development and sale of real estate projects, totaling EGP 15.01 billion. The company’s gross profit margin is 40%.

Emaar Misr for Development Company (SAE) delivered strong financial performance, with the debt-to-equity ratio rising from 0.1% to 4.7% over five years and a price-to-earnings ratio of 3.4x, below EG’s market average of 8.7x. The company reported second-quarter sales of EGP 4 billion and net income of EGP 1.91 billion, up from EGP 1.26 billion last year, reflecting solid growth in earnings per share from EGP 0.26 to EGP 0.40.

Simply Wall St Value Rating: ★★★★★☆

Review: Colgate-Palmolive (Pakistan) Limited is engaged in the business of manufacturing, importing, exporting and selling of oral care, personal care, detergents, home care and other related products in Pakistan and has a market capitalization of PKR 306.74 billion.

The story continues

Operations: Colgate-Palmolive (Pakistan) Limited generates revenues mainly from Personal Care and Home Care segments, totaling PKR 113.23 billion. The company’s net profit margin is 11.25%.

Colgate-Palmolive (Pakistan) has shown impressive growth with profits increasing by 66.1% over the past year, outpacing the household appliances industry by 30.3%. The company reported sales of PKR 149,360 million and net income of PKR 17,292 million for the fiscal year ending June 2024. Further, basic earnings per share increased to PKR 71.23 from PKR 42.88 a year earlier. Despite a slight increase in debt-to-equity ratio from zero to 3.7%, its debt is well covered by EBIT at 168x.

Simply Wall St Value Rating: ★★★★★☆☆

Review: Arzan Financial Group, a financing and investment company – KPSC operates in the field of wealth management, credit and asset management, debt collection and venture capital investment in Kuwait and has a market capitalization of KWD 166.96 million.

Operations: Arzan Financial Group engaged in financing and investments – KPSC generates revenues mainly from investments (KWD 12.00 million), installment loans (KWD 2.46 million), real estate (KWD 1.61 million) and financial intermediation services (KWD 0.93 million).

Arzan Financial Group for Financing and Investment – KPSC has shown an impressive 68.2% profit growth over the past year, outperforming the 18.4% of the Consumer Finance industry. The company’s net debt to equity ratio stands at a satisfactory 6.3%, reflecting its solid financial health. Furthermore, Arzan’s debt to equity ratio has improved from 32.7% to 13.6% over the five-year period, indicating effective debt management. The latest reports show second-quarter revenue of KWD 5.33 million and net income of KWD 1.54 million, both higher than last year.

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This Simply Wall St article is for general information purposes only. Our commentary is based solely on historical data and analyst forecasts, and is based on an objective methodology. Our articles are not intended to be financial advice. It is not a recommendation to buy or sell stocks and does not take into account your objectives or your financial situation. Our goal is to provide you with long-term, focused analysis based on fundamental data. Please note that our analysis may not reflect the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

This article discusses companies including CASE:EMFD, KASE:COLG and KWSE:ARZAN.

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