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The Canadian market has recently shown signs of recovery, buoyed by easing inflation and positive economic data, with the TSX rebounding over 5%. As central banks like the Federal Reserve and Bank of Canada consider rate cuts amid improving conditions, investors are increasingly looking at small-cap stocks with strong fundamentals as potential opportunities. In this article, we will explore three hidden Canadian small-cap gems that stand out due to their robust financial health and promising outlooks in these evolving market conditions.
Top 10 Undiscovered Gems With Strong Fundamentals In Canada
| Name | Debt To Equity | Revenue Growth | Earnings Growth | Health Rating |
|---|---|---|---|---|
| TWC Enterprises | 6.74% | 10.99% | 25.68% | ★★★★★★ |
| Taiga Building Products | NA | 6.05% | 10.50% | ★★★★★★ |
| Amerigo Resources | 12.87% | 7.49% | 12.97% | ★★★★★☆ |
| Reconnaissance Energy Africa | NA | 31.73% | -6.92% | ★★★★★☆ |
| Firan Technology Group | 17.91% | 3.75% | 23.32% | ★★★★★☆ |
| Mako Mining | 22.90% | 38.12% | 54.79% | ★★★★★☆ |
| Pizza Pizza Royalty | 15.66% | 3.64% | 3.95% | ★★★★☆☆ |
| Firm Capital Mortgage Investment | 57.73% | 9.38% | 5.91% | ★★★★☆☆ |
| Queen's Road Capital Investment | 7.20% | 22.14% | 22.20% | ★★★★☆☆ |
| Genesis Land Development | 53.32% | 25.58% | 47.05% | ★★★★☆☆ |
Let's review some notable picks from our screened stocks.
Leon's Furniture
Simply Wall St Value Rating: ★★★★★★
Overview: Leon's Furniture Limited, along with its subsidiaries, operates as a retailer of home furnishings, mattresses, appliances, and electronics in Canada and has a market cap of approximately CA$1.92 billion.
Operations: Leon's Furniture generates revenue of CA$2.53 billion from the sale of home furnishings, mattresses, appliances, and electronics. The company has a market cap of approximately CA$1.92 billion.
Leon's Furniture, a notable player in the Canadian market, reported Q2 2024 sales of CAD 617.66 million and net income of CAD 30.17 million, up from last year. Their debt-to-equity ratio has improved to 10.4% over five years, and they are trading at 61.9% below estimated fair value. The company also increased its quarterly dividend to CAD 0.20 per share and has appointed a new CFO recently, indicating robust financial health and strategic leadership changes.
Silvercorp Metals
Simply Wall St Value Rating: ★★★★★★
Overview: Silvercorp Metals Inc., along with its subsidiaries, focuses on acquiring, exploring, developing, and mining mineral properties and has a market cap of CA$1.12 billion.