Small-cap stocks can offer investors huge growth opportunities, but not without adding significant levels of risk. One strategy for containing the risk associated with small caps, is to search for companies whose price-multiples suggest that they are currently undervalued. To further hone in on the best in class, we only looked at companies with analyst ratings of 'Buy' or stronger. We came up with a pretty interesting list to help you on your search.
The forward P/E is a price multiple valuation metric, which is similar to the current P/E ratio, except that it uses the forecasted earnings instead. While this number might not be as accurate because it uses "forecasted" numbers, it does offer the benefit of illustrating analysts' expectations of a firm. If the market believes that earnings will grow moving forward, then the forward P/E should be lower than the current P/E. Financial Leverage, also known as
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