I have a personal preference for growth stories that are not in the limelight. It does not imply that those in the limelight can’t be value creators. However, undiscovered stocks to buy generally trade at a valuation gap. Therefore, the downside is capped and the upside potential is significant.

With thousands of listed stocks, missing on attractive growth stories is possible. I have therefore scanned through the listed universe and identified names that are relatively unheard. Of course, that’s just the first step. The next step is to eliminate fundamentally weak stocks from the list of under-the-radar names.

Therefore, the stories discussed represent ideas with strong fundamentals and a big addressable market. In my view, these companies are likely to be cash flow machines in the coming years. From a long-term perspective, these stocks are likely to have a healthy dividend yield.

Let’s discuss the business specifics that make these undiscovered stocks to buy worth considering.

PACS Group (PACS)

PACS Group (NYSE:PACS) is a relatively new listing and that’s the reason for the stock still remaining under-the-radar. The company is a provider of skilled nursing and assisted living facilities in the United States. With a big addressable market and a cost advantage, PACS Group is well positioned for healthy growth and value creation.

It’s worth noting that PACS stock IPO was at $21. In just over two months, the health care services provider has trended higher to $29. However, at a forward P/E of 20, valuations remain attractive and I believe that PACS stock is likely to remain in an uptrend.

As of Q1 2024, PACS operated 218 facilities across nine states. Therefore, there is ample scope for expansion in new states in the coming years. This is one catalyst for revenue growth.

I must add that the company’s skilled nursing facility has an average cost per day (ACPD) of $550. This is significantly lower as compared to hospitals (ACPD of $2,914) and inpatient rehabilitation facility (ACPD of $1,850). It’s the cost advantage that’s likely to translate into high occupancy rate. This would also imply healthy growth.

Amdocs (DOX)

Among technology stocks, Amdocs (NASDAQ:DOX) is undiscovered and trades at a valuation gap. DOX stock trades at a forward P/E of 12 and offers a dividend yield of 2.51%. Considering the addressable market and fundamentals, I am bullish on multibagger returns for this hidden-gem stock.

As an overview, Amdocs is a provider of software and services to the media and telecommunication industry globally. For Q2 2024, Amdocs reported record revenue of $1.25 billion. For the same period, the technology company reported a 12-month backlog of $4.23 billion. This provides clear revenue visibility and the backlog has swelled on a year-on-year basis.

From a business perspective, Amdocs is working towards simplifying and accelerating the adoption of GenAI across the telecom industry. This is a potential growth driver. Further, the outlook for the cloud business remains positive. During the quarter, Amdocs signed a five year deal with AT&T (NYSE:T) to expand cloud activities to a new domain.

I must add here that Amdocs has guided for free cash flow of $700 million for the year. Robust cash flows provide flexibility for acquisition driven growth and investment in technological advancement.

Aker BP ASA (AKRBF)

Aker BP ASA (OTCMKTS:AKRBF) is one of my favourite oil and gas exploration companies. AKRBF stock has garnered little attention as it trades in the OTC exchange. However, it a matter of time before this 9.35% dividend yield stock surges higher.

As an overview, Aker BP is an oil & gas exploration company with focus in the Norwegian Continental Shelf. The exploration company has a quality asset base with 2P reserves of 1,716mmboe. Further, the company has 2C resources of 809mmboe. The asset base ensures that Aker delivers sustained production growth.

I am also bullish on the company considering the full portfolio break-even of $35 to $40 per barrel. Even if oil continues to trade in the range of $80 to $100 per barrel, Aker is positioned to deliver robust cash flows.

It’s worth noting that Aker has an investment grade balance sheet with a low leverage of 0.2. Further, a liquidity buffer of $6.6 billion provides ample flexibility. The exploration company is therefore positioned to invest aggressively in its assets. This will translate into sustained upside in free cash flows.

On the date of publication, Faisal Humayun 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.