3 Stocks That May Be Trading Below Their Estimated Fair Value

As global markets experience a boost from cooling inflation and strong bank earnings, major indices like the S&P 500 and Dow Jones have seen notable gains. In this environment, where value stocks are outperforming growth shares, identifying stocks that may be trading below their estimated fair value becomes particularly appealing. A good stock in such conditions is often characterized by strong fundamentals and resilience to economic fluctuations, offering potential for appreciation as market dynamics shift.

Top 10 Undervalued Stocks Based On Cash Flows

Name	Current Price	Fair Value (Est)	Discount (Est)
Livero (TSE:9245)	¥1558.00	¥3107.48	49.9%
Strike CompanyLimited (TSE:6196)	¥3600.00	¥7189.65	49.9%
Solum (KOSE:A248070)	₩18620.00	₩37219.83	50%
North Electro-OpticLtd (SHSE:600184)	CN¥10.81	CN¥21.57	49.9%
EuroGroup Laminations (BIT:EGLA)	€2.54	€5.06	49.8%
ASMPT (SEHK:522)	HK$75.15	HK$150.17	50%
Shinko Electric Industries (TSE:6967)	¥5849.00	¥11653.46	49.8%
Equifax (NYSE:EFX)	US$268.88	US$535.98	49.8%
BATM Advanced Communications (LSE:BVC)	£0.19	£0.38	49.8%
RXO (NYSE:RXO)	US$26.19	US$52.36	50%

Click here to see the full list of 878 stocks from our Undervalued Stocks Based On Cash Flows screener.

Let's take a closer look at a couple of our picks from the screened companies.

Julius Bär Gruppe (SWX:BAER)

Overview: Julius Bär Gruppe AG is a wealth management company offering solutions across Switzerland, Europe, the Americas, Asia, and internationally with a market cap of CHF12.79 billion.

Operations: The company generates revenue primarily from its Private Banking segment, amounting to CHF3.15 billion.

Estimated Discount To Fair Value: 43.1%

Julius Bär Gruppe, trading at CHF62.44, is significantly undervalued based on discounted cash flow analysis with a fair value estimate of CHF109.68. Despite expected annual earnings growth of 21.42%, challenges include a low return on equity forecast (17.8%) and high bad loans ratio (2.1%). Recent M&A discussions involving its Brazil unit could impact future valuations and strategic direction, while the dividend coverage remains questionable given current earnings projections.

• According our earnings growth report, there's an indication that Julius Bär Gruppe might be ready to expand.
• Delve into the full analysis health report here for a deeper understanding of Julius Bär Gruppe.

CSPC Innovation Pharmaceutical (SZSE:300765)

Overview: CSPC Innovation Pharmaceutical Co., Ltd. is involved in the research, development, production, and sales of biopharmaceuticals, APIs, and functional foods both in China and internationally, with a market cap of CN¥39.08 billion.

Operations: The company's revenue is derived from its activities in biopharmaceuticals, APIs, and functional foods across domestic and international markets.

Estimated Discount To Fair Value: 15.2%

CSPC Innovation Pharmaceutical, trading at CN¥28.06, is undervalued based on discounted cash flow analysis with a fair value estimate of CN¥33.08. Expected revenue growth of 35.1% annually surpasses the market average, while earnings are forecast to grow significantly at 40.5% per year. Despite these prospects, the dividend yield of 0.95% lacks coverage by free cash flows and return on equity is projected to remain low at 14.7%.

• Insights from our recent growth report point to a promising forecast for CSPC Innovation Pharmaceutical's business outlook.
• Click here to discover the nuances of CSPC Innovation Pharmaceutical with our detailed financial health report.

Shenzhen New Industries Biomedical Engineering (SZSE:300832)

Overview: Shenzhen New Industries Biomedical Engineering Co., Ltd. focuses on the research, development, production, and sale of clinical laboratory instruments and in vitro diagnostic reagents for hospitals both in China and internationally, with a market cap of CN¥50.05 billion.

Operations: The company's revenue primarily comes from its in vitro diagnostic segment, totaling CN¥4.44 billion.

Estimated Discount To Fair Value: 23.9%

Shenzhen New Industries Biomedical Engineering is trading at CN¥63.7, significantly undervalued against its fair value estimate of CN¥83.7. With a robust revenue growth forecast of 21.2% annually, surpassing the market average, and earnings expected to grow at 21.74% per year, the company demonstrates strong cash flow potential. Recent financials show improved performance with net income rising to CN¥1.38 billion for the nine months ending September 2024, despite an unstable dividend history.

• The analysis detailed in our Shenzhen New Industries Biomedical Engineering growth report hints at robust future financial performance.
• Click here and access our complete balance sheet health report to understand the dynamics of Shenzhen New Industries Biomedical Engineering.

Seize The Opportunity

• Unlock our comprehensive list of 878 Undervalued Stocks Based On Cash Flows by clicking here.
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Ready For A Different Approach?

• Explore high-performing small cap companies that haven't yet garnered significant analyst attention.
• Diversify your portfolio with solid dividend payers offering reliable income streams to weather potential market turbulence.
• Fuel your portfolio with companies showing strong growth potential, backed by optimistic outlooks both from analysts and management.

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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