This week I’m looking at the European small and micro-cap market for some underappreciated gems that are on the move. I’ve screened out UK stocks, but am looking at the rest of the European markets.
My focus is really on smaller companies where we are seeing a combination of solid fundamentals that are already producing some share price movement. I find this a useful exercise when looking for future stocks for my portfolios. I’m generally agnostic on the country, but do have my biases when it comes to sectors.
We start in Germany with 2invest, which rewarded investors considerably in the early part of the year. Shares are up over 26% on a YTD basis. 2invest is a listed investment company that specialises in the biosciences and IT sectors, both in Germany and globally.
The company last reported in April with revenue of EUR 3.83m and net income of EUR 3.33m. Total revenues as of December 2023 were EUR 9m. Performance of this kind on the share price of a listed investment company is excellent. Bear in mind we are dealing with small and micro caps here, so shares could be hard to come by in big quantities.
Rank Progress is a specialist in real estate development and management, both in Poland and outside the country. It focuses on properties like shopping malls and art galleries. Looking at its core metrics, Rank Progress seems to be one of the healthiest real estate plays in Europe at the moment, at least in the smaller end of the market.
What caught my eye was the 373% surge in revenues it reported in May, and the performance of the shares, which are already up 200% since the start of the year and 437% on the five year picture. The PE ratio is still a mere 3.43. Shares are denominated in local currency Polish zloty.
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