In today’s Hidden Profits Report, I take a quick hulk at where the markets are trading and current valuations. In spite of the recent period of volatility, large-cap stocks are clearly overvalued.

Small-cap stocks are trading at discounted valuations with an average PE ratio of just 8.

Small-cap deep-value stocks are trading at ridiculously low multiples of earnings and asset value.

We are fighting a bad tape and rising interest rates in the short term, but long-term super cheap microcap stocks have the potential to deliver enormous returns for patient-aggressive investors.

I share two ideas with you: both are small companies with excellent growth prospects, strong credit reports, and improving business conditions that should be among the big long term small cap winners.

— Tim Melvin

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Source: Investors Alley