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Reap Big Profits With Small Cap Value Stocks


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Small Cap Value Stocks Make Investor Portfolios Happy

Small Cap Value Due to their relatively low profile, small cap valuestocks are easier to find than their large cap brethren are. While there are many large cap value stocks, the amount of scrutiny they receive means that they do not remain undervalued for long. Small caps are less exposed to media blitzes and the prognostications of high-profile investment advisors, which means that their value remains hidden until it is too obvious to be denied. This allows patient investors to get in early and accumulate positions at an affordable, undervalued price until the stock finally attracts notice among the general public and takes off running.

 Find Hidden Small Cap Value Gems

•             Network Engines Inc. of Canton, Massachusetts (NEI) is trading at only a 5-1 P/E level and at 0.47 of book value.  NEI is a provider of network and telephonic system solutions that was established in 1989.

•             LB Foster Co. (FSTR) has been in business since 1902. Foster is an excellent example of small cap value in a provider of vital industrial products. In their particular case, the company primarily manufactures equipment for the rail industry, such as rails, concrete railroad ties, and all manner of necessary installation hardware. Foster trades at a price of 1.1 to book value.

•             Parke Bancorp (PKBK) of Sewell, New Jersey is a holding company for a Northeast regional bank that services Atlantic, Cape May, and Gloucester counties.  Trading at only half of its 1 year target of $10 a share, Parke is priced at only 0.43 of book value and 4.1 times trailing earnings.

 Small cap value stocks frequently trade lower than 50% of their book value, which is the equivalent of buying at 50 cents on the dollar for companies that are well established and displaying a measureable track record of growth and profitability.

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