Najran Cement Co and 2 Under-the-Radar US Stocks: Seizing Value in Volatile Markets

The global economy is caught in a tug-of-war between inflationary pressures, geopolitical tensions, and the relentless march of technological progress. In this environment, investors are searching for companies that offer resilience and growth potential despite near-term headwinds. Today, we spotlight Najran Cement Co in Saudi Arabia and two overlooked U.S. firms—Merck & Co (MRK) and First Solar (FSLR)—that fit the bill. These companies are undervalued, underappreciated, and positioned to thrive in their respective sectors.

Najran Cement Co: A Saudi Growth Engine with Near-Term Volatility

Najran Cement Co (NASDAQ: NACM) is a key player in Saudi Arabia's booming construction sector, benefiting from the kingdom's Vision 2030 infrastructure push. The company's financials tell a compelling story:

• Revenue rose 9.6% in 2024 to 534.5 million SAR, driven by demand for its cement products in projects like the Riyadh Metro and Neom City.
• Net profit grew 24% to 68.4 million SAR in 2024, fueled by reduced financing costs and operational efficiency.

But the road isn't smooth. Q1 2025 sales dropped 2% sequentially, reflecting weaker demand and rising production costs.

Why Buy Now?
- Valuation: The stock trades at a P/E of 19.2x, slightly premium to peers but justified by its exposure to Saudi Arabia's infrastructure boom.
- Growth Catalysts:
- Vision 2030 projects will require 60 million tons of cement annually by 2030, per industry estimates.
- The company's diversified product mix (including ready-mix concrete) reduces reliance on cyclical demand.
- Risk: Rising fuel costs and environmental regulations could pressure margins.

Merck & Co (MRK): The Undervalued Pharma Giant

Merck, a pharmaceutical stalwart, is flying under the radar despite its 45.5% upside potential to fair value.

• Strengths:
• Keytruda dominance: The cancer drug generates $18 billion in annual sales, with new indications in the pipeline.
• Solid fundamentals: A forward P/E of 8.5x and a 2.3% dividend yield make it a value buy.
• Near-Term Challenges:
• Patent cliffs and pricing pressure in mature markets.
• Overdependence on Keytruda's success.

Why Now?
- Catalysts: Expansion into emerging markets and a robust pipeline (e.g., diabetes and cardiovascular therapies).
- Safety: A fortress balance sheet with $30 billion in cash and minimal debt.

First Solar (FSLR): Leading the Renewable Energy Surge

First Solar, a leader in thin-film solar panels, is a contrarian bet in a sector rattled by policy uncertainty and supply chain hiccups.

• Key Metrics:
• 30% upside to fair value, with a forward P/E of 14.2x.
• 29% revenue growth in 2024, driven by U.S. and European demand.
• Growth Drivers:
• Inflation Reduction Act (IRA) subsidies are accelerating solar adoption.
• First Solar's cost leadership (panels at ~$0.25/watt) outpaces rivals.

Why Buy?
- Undervalued: The stock is down 6% YTD despite its structural tailwinds.
- Risk: Slower adoption if policy support wanes.

The Bottom Line: Seize Value Before the Crowd

Najran Cement, Merck, and First Solar are all trading at discounts to their fair value while facing sector-specific headwinds. But their long-term growth trajectories—tied to infrastructure, healthcare, and energy transitions—are undeniable.

Investors should act now:
- Najran Cement for exposure to Saudi Arabia's industrialization.
- MRK as a dividend-rich play on pharmaceutical resilience.
- FSLR to capitalize on the solar boom.

The market's volatility is creating buying opportunities in overlooked corners. These three stocks are prime candidates for investors with a 5-10 year horizon.

Don't wait for the next wave of optimism—act now before these stocks catch Wall Street's attention.

This article is for informational purposes only. Always conduct your own research and consult a financial advisor before making investment decisions.