Stock Analysis

3 Stocks Possibly Trading Below Fair Value By Up To 43.3%

Published November 06, 2024

Global markets have experienced a mixed performance recently, with major indices such as the Nasdaq Composite and S&P MidCap 400 reaching record highs before retreating amid a busy earnings week. As economic indicators send conflicting signals, investors are increasingly focused on identifying stocks that may be trading below their intrinsic value in this complex environment. In such conditions, finding undervalued stocks requires careful analysis of fundamentals and market sentiment to assess whether current prices reflect potential growth opportunities.

Top 10 Undervalued Stocks Based On Cash Flows

Name	Current Price	Fair Value (Est)	Discount (Est)
Proya CosmeticsLtd (SHSE:603605)	CN¥97.24	CN¥194.27	49.9%
IMAGICA GROUP (TSE:6879)	¥476.00	¥947.55	49.8%
Nordic Waterproofing Holding (OM:NWG)	SEK175.60	SEK349.53	49.8%
Western Alliance Bancorporation (NYSE:WAL)	US$84.63	US$168.45	49.8%
Elica (BIT:ELC)	€1.725	€3.44	49.8%
On the Beach Group (LSE:OTB)	£1.534	£3.07	50%
North Electro-OpticLtd (SHSE:600184)	CN¥11.45	CN¥22.90	50%
KeePer Technical Laboratory (TSE:6036)	¥3935.00	¥7851.33	49.9%
Fine Foods & Pharmaceuticals N.T.M (BIT:FF)	€8.36	€16.67	49.8%
Energy One (ASX:EOL)	A$5.56	A$11.06	49.7%

Click here to see the full list of 963 stocks from our Undervalued Stocks Based On Cash Flows screener.

We'll examine a selection from our screener results.

Nanjing King-Friend Biochemical PharmaceuticalLtd (SHSE:603707)

Overview: Nanjing King-Friend Biochemical Pharmaceutical Co., Ltd. operates in the pharmaceutical industry, focusing on biochemical products, with a market cap of CN¥24.15 billion.

Operations: Unfortunately, there is no specific revenue segment information provided in the text for Nanjing King-Friend Biochemical Pharmaceutical Co., Ltd.

Estimated Discount To Fair Value: 43.3%

Nanjing King-Friend Biochemical Pharmaceutical appears undervalued, trading at CNY 14.95, significantly below its estimated fair value of CNY 26.36. Despite recent earnings declines, with nine-month net income dropping to CNY 605.78 million from CNY 839.31 million a year ago, the company's revenue is forecast to grow annually by 25.9%, outpacing the Chinese market average of 14%. Earnings are expected to grow by over 70% per year, suggesting potential for future profitability improvements.

SHSE:603707 Discounted Cash Flow as at Nov 2024

Yunnan Botanee Bio-Technology GroupLTD (SZSE:300957)

Overview: Yunnan Botanee Bio-Technology Group Co. LTD is involved in the manufacture and sale of skincare and makeup products in China, with a market cap of CN¥22.99 billion.

Operations: The company's revenue segments include the manufacture and sale of skincare and makeup products in China.

Estimated Discount To Fair Value: 37.4%

Yunnan Botanee Bio-Technology Group LTD is trading at CN¥54.75, notably below its fair value estimate of CN¥87.5, suggesting it may be undervalued based on cash flows. Despite a volatile share price and reduced profit margins from 20.1% to 9.7%, earnings are projected to grow significantly at 33.85% annually over the next three years, outpacing the market average of 25.9%. Recent nine-month net income fell to CN¥414.77 million from CN¥579.19 million last year amidst large one-off items affecting results.

SZSE:300957 Discounted Cash Flow as at Nov 2024

Fositek (TWSE:6805)

Overview: Fositek Corp. is involved in the manufacture and wholesale of electronic materials and components, with a market cap of NT$59.16 billion.

Operations: The company generates revenue primarily from its Electronic Components & Parts segment, amounting to NT$6.77 billion.

Estimated Discount To Fair Value: 12.6%

Fositek is trading at NT$863, below its fair value estimate of NT$987.06, indicating potential undervaluation based on cash flows. The company reported strong earnings growth of 62.7% over the past year and forecasts suggest revenue will grow at 43.7% annually, outpacing the Taiwanese market average. Analysts agree on a potential 26.5% stock price increase, with earnings expected to rise significantly by 50.35% per year over the next three years.

TWSE:6805 Discounted Cash Flow as at Nov 2024

Taking Advantage

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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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