Companies, such as Christie Group, are deemed to be undervalued because their shares are currently trading below their true values. There’s a few ways you can measure the value of a company – you can forecast how much money it will make in the future and base your valuation off of this, or you can look around at its peers of similar size and industry to roughly estimate what it should be worth. Below, I’ve created a list of companies that compare favourably in all criteria based on their most recent financial data, making them potentially good investments.
Christie Group plc (AIM:CTG)
Christie Group plc, together with its subsidiaries, provides professional business services for leisure, retail, and care sectors in Europe and internationally. Founded in 1846, and currently run by David Rugg, the company employs 3,000 people and has a market cap of GBP £38.59M, putting it in the small-cap stocks category.
CTG’s shares are currently hovering at around -40% below its intrinsic value of £2.54, at a price of UK£1.53, according to my discounted cash flow model. This mismatch signals an opportunity to buy CTG shares at a discount. What’s even more appeal is that CTG’s PE ratio stands at around 16.1x against its its Professional Services peer level of, 18.46x meaning that relative to other stocks in the industry, we can buy CTG’s stock at a cheaper price today. CTG is also a financially robust company, with current assets covering liabilities in the near term and over the long run. Interested in Christie Group? Find out more here.
Griffin Mining Limited (AIM:GFM)
Griffin Mining Limited, a mining and investment company, engages in the mining, exploration, and development of mineral properties. Established in 1988, and currently lead by , the company employs 390 people and with the stock’s market cap sitting at GBP £268.04M, it comes under the small-cap category.
GFM’s shares are now floating at around -53% under its intrinsic level of $3.31, at a price tag of UK£1.55, based on its expected future cash flows. This mismatch signals an opportunity to buy GFM shares at a discount. In terms of relative valuation, GFM’s PE ratio stands at 8.02x relative to its Metals and Mining peer level of, 13.01x indicating that relative to its comparable set of companies, you can purchase GFM’s stock for a lower price right now. GFM is also a financially healthy company, with current assets covering liabilities in the near term and over the long run. The stock’s debt-to-equity ratio of 2.30% has been diminishing for the last couple of years signalling its capacity to reduce its debt obligations year on year. Continue research on Griffin Mining here.
Morgan Sindall Group plc (LSE:MGNS)
Morgan Sindall Group plc operates as a construction and regeneration company in the United Kingdom. Started in 1953, and now led by CEO John Morgan, the company employs 6,400 people and with the company’s market cap sitting at GBP £669.77M, it falls under the small-cap category.
MGNS’s shares are currently floating at around -54% under its actual value of £32.8, at the market price of UK£14.94, based on its expected future cash flows. This mismatch signals an opportunity to buy MGNS shares at a discount. Also, MGNS’s PE ratio is trading at 12.57x against its its index peer level of, 17.17x suggesting that relative to its comparable set of companies, we can buy MGNS’s stock at a cheaper price today. MGNS is also strong financially, with short-term assets covering liabilities in the near future as well as in the long run. Interested in Morgan Sindall Group? Find out more here.
For more financially sound, undervalued companies to add to your portfolio, explore this interactive list of undervalued stocks.