In This Article:
The Australian market has been flat over the last week, but it has risen 7.8% over the past 12 months with earnings forecast to grow by 13% annually. In light of these conditions, identifying promising small-cap stocks that exhibit strong growth potential and solid fundamentals can be particularly rewarding for investors.
Top 10 Undiscovered Gems With Strong Fundamentals In Australia
| Name | Debt To Equity | Revenue Growth | Earnings Growth | Health Rating |
|---|---|---|---|---|
| Fiducian Group | NA | 9.94% | 6.00% | ★★★★★★ |
| Lycopodium | NA | 15.62% | 29.55% | ★★★★★★ |
| K&S | 15.24% | -1.53% | 26.68% | ★★★★★★ |
| Sugar Terminals | NA | 2.34% | 2.64% | ★★★★★★ |
| Plato Income Maximiser | NA | 11.43% | 14.26% | ★★★★★★ |
| SKS Technologies Group | NA | 31.29% | 43.27% | ★★★★★★ |
| Hearts and Minds Investments | NA | 18.39% | -3.93% | ★★★★★★ |
| A2B Australia | 15.83% | -7.78% | 25.44% | ★★★★☆☆ |
| Paragon Care | 340.88% | 28.05% | 68.37% | ★★★★☆☆ |
| Boart Longyear Group | 71.20% | 9.71% | 39.19% | ★★★★☆☆ |
Let's dive into some prime choices out of from the screener.
Austin Engineering
Simply Wall St Value Rating: ★★★★★☆
Overview: Austin Engineering Limited (ASX:ANG) manufactures, repairs, overhauls, and supplies mining attachment products and other related services for industrial and resources-related sectors with a market cap of A$390.06 million.
Operations: Revenue for Austin Engineering Limited is derived primarily from the Asia-Pacific region (A$154.13 million), followed by North America (A$84.62 million) and South America (A$48.99 million).
Austin Engineering, a small-cap Australian company, has shown impressive earnings growth of 41.5% over the past year, outpacing the Machinery industry’s 30.7%. The firm boasts a satisfactory net debt to equity ratio of 15.5%, and its interest payments are well covered by EBIT at 6.6x coverage. Trading at a price-to-earnings ratio of 18.7x, it appears attractively valued compared to the broader Australian market's 19.1x P/E ratio.
Supply Network
Simply Wall St Value Rating: ★★★★★★
Overview: Supply Network Limited (ASX:SNL) supplies aftermarket parts to the commercial vehicle industry in Australia and New Zealand, with a market cap of A$1.02 billion.
Operations: The company generated A$278.41 million in revenue from supplying aftermarket parts to the commercial vehicle market in Australia and New Zealand.
Supply Network has seen its debt to equity ratio fall from 18.1% to 12.9% over the past five years, reflecting prudent financial management. The company's net debt to equity ratio stands at a satisfactory 6%, and its interest payments are well covered by EBIT (23x). Notably, earnings grew by 27.9% last year, outpacing the Retail Distributors industry’s growth of 2.7%. Despite shareholder dilution in the past year, future earnings are forecasted to grow at an annual rate of nearly 14%.