Laser Focus World is an industry bedrock—first published in 1965 and still going strong. We publish original articles about cutting-edge advances in lasers, optics, photonics, sensors, and quantum technologies, as well as test and measurement, and the shift currently underway to usher in the photonic integrated circuits, optical interconnects, and copackaged electronics and photonics to deliver the speed and efficiency essential for data centers of the future.

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Editorial Advisory Board

  • Professor Andrea M. Armani, University of Southern California
  • Ruti Ben-Shlomi, Ph.D., LightSolver
  • James Butler, Ph.D., Hamamatsu
  • Natalie Fardian-Melamed, Ph.D., Columbia University
  • Justin Sigley, Ph.D., AmeriCOM
  • Professor Birgit Stiller, Max Planck Institute for the Science of Light, and Leibniz University of Hannover
  • Professor Stephen Sweeney, University of Glasgow
  • Mohan Wang, Ph.D., University of Oxford
  • Professor Xuchen Wang, Harbin Engineering University
  • Professor Stefan Witte, Delft University of Technology

Fast-Growing Companies That Are Still Undervalued

Momentum investors look for companies that are already on an upward trajectory in hopes that the trend will continue, while value investors seek out firms with fundamentals supporting a higher share price than currently available on the market. Though these core investment strategies are often positioned separately from one another, in some cases they work in tandem, making for an even more compelling case for investment.

Finding firms with a strong recent history of share price growth that also have one or more value indicators flashing may be somewhat tricky, as a higher stock price typically means less-compelling price-to-earnings or price-to-sales ratios, book-value-per-share, and so on. However, there are several companies at the end of 2024 that meet both of these qualifications.

FOA: Stellar Third-Quarter Report, Strong Prospects

Finance of America Companies Inc. (NYSE: FOA) is a financial services company providing home equity conversion, reverse mortgage, and similar products for retired customers. As of December 5, 2024, the firm had a low P/S ratio of 0.9 and a trailing P/E ratio of 1.8. In the month prior to that date, shares of FOA jumped upward by 51.7%, contributing to trailing twelve month returns of just under 144%.

Some of the November gains are likely attributable to the company's excellent third-quarter earnings report, delivered on the 6th of the month. Finance of America noted $204 million in net income from continuing operations, a sharp positive swing after posting losses in this area of $172 million and $5 million in the third quarter of 2023 and the second quarter of 2024, respectively. Adjusted EPS also swung toward positive, with the most recent figures of 67 cents surpassing consensus expectations by an impressive 54 cents per share. Total revenues of $290 million for the quarter also beat analyst predictions.

The shift back to profitability had a positive impact on book equity, which was $456 million at the end of the quarter in September. All of this positions Finance of America exceptionally well to face an uncertain time in the real estate and mortgage markets in the coming year. Indeed, if the real estate market does become more volatile—and homeowners seek new ways of securing funding for common expenses—it could be a boon for this firm.

KINS: Major Turnaround and Significant Rally

Kingstone Companies Inc. (NASDAQ: KINS) is a property and casualty insurance company that in some ways exemplifies a momentum stock. Shares of KINS are up a tremendous 520% in the last year and were trading at a 52-week high as of December 5, 2024. After reaching nearly $12 per share in August, Kingstone dipped slightly and hovered around $9.50 for several weeks. However, since the start of November shares have risen more or less steadily.

Given the significance of Kingstone's rally in the last year, it would be easy to assume that shares are considerably overvalued at this stage. Nonetheless, the company's P/E ratio of 12.1 is in line with many rivals in the insurance industry, and its P/S ratio of 1.4 is competitive. After a series of losses in 2023, the firm has a new CEO and recently reported a sharp rise in both new business policies and premiums for its personal lines. If these trends continue, Kingstone could be on track to beat its all-time high share price of nearly $22 set in 2018.

HUT: Share Price Nearly Tripling as Profitability Secured

Given the rapid rise in the price of Bitcoin and other cryptocurrencies toward the end of the year, it is no surprise that cryptocurrency mining and data center firm Hut 8 Corp. (NASDAQ: HUT) has also benefitted. Hut 8 shares are up about 174% in the last year as of December 5. In early December, the company also announced an at-the-market program and a $250-million share buyback project as means of attempting to control for volatility.

Hut 8 has only recently become profitable and reported net income of $0.9 million in the latest quarter. And while it does not have value indicators as competitive as either FOA or KINS above, this company's P/S ratio of 21.8 is competitive within the rapidly-growing digital asset industry.

Certainly, Hut 8 and other cryptocurrency-adjacent companies represent a higher risk level than firms in many other industries as a result of volatility in the crypto space. However, many in the digital currency world view the political and regulatory landscapes in 2025 and beyond as likely favorable, which has helped to drive all-time highs for many tokens.

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