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Stocks Under $10 with 50-100% upside potential - 14 days FREE!

10 Stock Picks From Small-Cap Specialist Royce Funds

10. Federated Investors (FII)

Company profile: Federated, with a market value of $2.3 billion, is a provider of asset management services for institutional and individual investors.

Investor takeaway: Its shares are up 41% this year and have a three-year, average annual return of 1.7%. Its shares carry a 4.66% dividend yield.

Analysts give its shares seven "hold," ratings, one "weak hold," and one "sell," according to a survey of analysts by S&P. For fiscal 2012, analysts estimate it will earn $1.61 per share and that that will grow by 11% to $1.78 next year.

The company is a big manager of money market funds, with slightly more than $285 billion in such assets at the end of 2011, and as a result, historically low interest rates have made it difficult for Federated to maintain positive yields on these funds. Hence, investors have moved on to higher-yielding assets elsewhere.

9. Alleghany (Y)

Company profile: Alleghany, with a market value of $6 billion, is an investment holding company that uses a value-oriented philosophy to acquire interests in attractive businesses and equity holdings principally in the insurance industry. The firm purchases fractional and outright stakes and generally holds them for long periods.

Investor takeaway: Its shares are up 19% this year and have a three-year, average annual return of 12%. Its shares get one "hold," rating from analysts, according to a survey of analysts by S&P.

8. Kennametal (KMT)

Company profile: Kennametal, with a market value of $3.6 billion, produces metal-cutting tools and tooling systems used in the heavy equipment, aerospace, and automotive industries.

Investor takeaway: Its shares are up 23% this year and have a three-year, average annual return of 30%. Its shares have a projected 1.28% dividend yield. Analysts give its shares six "buy" ratings, three "buy/holds," five "holds," and one "weak hold," according to a survey of analysts by S&P.

7. Unit Corp. (UNT)

Company profile: Unit, with a market value of $2 billion, is engaged in the contract drilling of oil and natural-gas wells in the Western U.S. It also owns about 75 producing wells.

Investor takeaway: Its shares are down 12% this year and have a three-year, average annual return of 12%. Analysts give its shares five "buy" ratings, one "buy/hold," and two "holds," according to a survey of analysts by S&P. Analysts expect it will earn $4.55 per share this year and that that will grow by 3% to $4.68 next year.

6. Buckle (BKE)

Company profile: Buckle, with a market value of $2 billion, is a retailer of medium and higher-priced casual apparel for men and women. It operates more than 340 retail stores in 40 states.

Investor takeaway: Its shares are up 12% this year and have a three-year, average annual return of 16%. Its shares have a 1.77% projected dividend yield. Analysts give its shares one "buy" rating and nine "holds," according to a survey of analysts by S&P. Analysts estimate it will earn $3.43 per share in its current fiscal year and that will grow by 7% to $3.66 per share the following year.

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