In the stock market, we hear big names all the time. But, since so many people already know their potential, the stocks are likely overvalued, with prices reflecting. However, the stocks flying under the radar are where you will find value. Since many don’t know about them, their valuation hasn’t yet reflected the massive potential they are capable of. Don’t let this fool you.
The potential is there if not more than you might find elsewhere. But, there is a big problem for many investors when they try to invest in stocks with greater potential. It is very time-consuming for them to spend hours researching to find them. Luckily for you, we have done just that and have spent time researching for you. As such, we highlight three stocks that Wall Street insiders are whispering about in this article and uncover and analyze these hidden games as potential additions to your portfolio.
Celestica (CLS)
Celestica (NYSE:CLS) is a global manufacturing company that provides a wide range of services. This includes designing hardware and supply chain solutions for many industries. The stock is up over 118% in the past year, with six Yahoo Finance analysts projecting an average one-year price target of $32.25.
Having recently announced two new 800G network switches, CLS will dominate the AI industry by powering data centers. As we all know, AI is set to explode in the coming years, and CLS will ride off that trend with its new products.
Because of these developments, the company’s earnings are set to surge, with analysts expecting EPS to grow over 23% next year. With a P/E ratio of 12.88x compared to the sector median of 21.46x, the company is likely relatively undervalued compared to its peers. With the massive earnings growth and relative undervaluation, this stock will continue to run quietly.
SurgePays (SURG)
SurgePays (NASDAQ:SURG) is a financial technology and telecommunications provider whose main demographic is underserved and underbanked customers. This stock has Seeking Alpha reporting strong buy recommendations across Quant and Wall Street ratings. Yahoo Finance is also maintaining a one-year price target for SURG between a mean of $13.25 to $15—an optimistic projection compared to its current price of $6.97.
Between 2019 and 2022, this stock’s revenue has grown by a tremendous 370%. This growth is largely attributed to the Affordable Connectivity Program (ACP). Signing on nearly 20 million underserved households was a trajectory-changing addressable market for SURG.
Looking at its Q3 financials, SURG greatly improved its net income from $1.5 million in Q3 2022 to over $7 million in Q3. Going past just stellar profitability to complement its revenue growth, the company also holds an outstanding P/E valuation ratio of 5.15x compared to its sector median of 13.35x. With the potential realization of selling ACP mobile internet plans through convenience stores, investors should look into SURG for an attractive upside.
GigaCloud Technology (GCT)
GigaCloud Technology (NASDAQ:GCT) is a business-to-business commerce platform that facilitates the sale and purchase of large items, particularly furniture. Instead of a standard business-to-consumer model, its business-to-business model has paved a unique competitive niche founded on lower operating costs. Wallstreet and Quant analysts’ “strong buy” recommendations have propelled GCT as an undervalued stock with sustainable competitive moats.
Hiring external labor and specialists from China has allowed the company to run one of the lowest cost bases despite the recent industry downturn. Additionally, due to their large size and sales volume, they have reduced transport costs by nearly 30% per item. These cost cuts appear in its Q3 earnings, with 39% year-over-year growth in revenue and a 41% increase in gross merchandise value. While this stock does not have the best valuation compared to its peers. However, its tremendous growth and runway for future innovation sets it up as a stock that Wall Street will definitely talk about.
On the date of publication, Ian Hartana and Vayun Chugh did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
