Uncovering 3 Promising Canadian Small Caps Backed By Solid Fundamentals

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With Canada's election now concluded, a significant source of uncertainty has been lifted, allowing the government to focus on key issues such as trade and economic growth. As policymakers consider fiscal stimulus and potential interest rate cuts to support the economy, investors may find opportunities in Canadian small-cap stocks that are backed by solid fundamentals.

Top 10 Undiscovered Gems With Strong Fundamentals In Canada

Name

Debt To Equity

Revenue Growth

Earnings Growth

Health Rating

TWC Enterprises

4.98%

13.46%

16.87%

★★★★★★

Yellow Pages

NA

-11.96%

-15.73%

★★★★★★

Pinetree Capital

0.20%

63.68%

65.79%

★★★★★★

Reconnaissance Energy Africa

NA

9.16%

15.11%

★★★★★★

Itafos

28.17%

11.62%

53.49%

★★★★★☆

Mako Mining

8.59%

38.81%

59.80%

★★★★★☆

Corby Spirit and Wine

59.18%

8.79%

-5.67%

★★★★☆☆

Genesis Land Development

48.16%

31.08%

55.45%

★★★★☆☆

Senvest Capital

81.59%

-11.73%

-12.63%

★★★★☆☆

Dundee

3.91%

-36.42%

49.66%

★★★★☆☆

Click here to see the full list of 44 stocks from our TSX Undiscovered Gems With Strong Fundamentals screener.

We're going to check out a few of the best picks from our screener tool.

High Liner Foods

Simply Wall St Value Rating: ★★★★★☆

Overview: High Liner Foods Incorporated is involved in the processing and marketing of prepared and packaged frozen seafood products across North America, with a market capitalization of CA$490.65 million.

Operations: High Liner Foods generates revenue primarily from the manufacturing and marketing of prepared and packaged frozen seafood, totaling $959.22 million. The company has a market capitalization of CA$490.65 million.

High Liner Foods has been making waves with its impressive earnings growth of 89.3% over the past year, outpacing the food industry's 29.4%. Despite a high net debt to equity ratio of 50.1%, the company has successfully reduced this from 127.2% over five years, signaling improved financial health. Trading at a significant discount of 62.2% below its estimated fair value, High Liner appears undervalued in the market. Recent changes include appointing PwC as their new auditor and exploring M&A opportunities while maintaining shareholder returns through dividends and share buybacks, reflecting a balanced strategic approach for future growth.

TSX:HLF Debt to Equity as at May 2025
TSX:HLF Debt to Equity as at May 2025

Sprott

Simply Wall St Value Rating: ★★★★★★

Overview: Sprott Inc. is a publicly owned asset management holding company with a market cap of CA$1.90 billion.

Operations: Sprott generates revenue primarily through asset management services. The company's net profit margin is 25%, reflecting its profitability relative to total revenue.