As the UK market grapples with global economic challenges, including weak trade data from China affecting the FTSE 100 and FTSE 250 indices, investors are increasingly on the lookout for opportunities amidst uncertainty. In such an environment, identifying stocks that may be trading below their estimated value can offer potential advantages by focusing on companies with strong fundamentals and resilience against broader market pressures.
Top 10 Undervalued Stocks Based On Cash Flows In The United Kingdom
| Name | Current Price | Fair Value (Est) | Discount (Est) |
| Victrex (LSE:VCT) | £7.19 | £13.69 | 47.5% |
| Topps Tiles (LSE:TPT) | £0.38 | £0.7 | 45.5% |
| TBC Bank Group (LSE:TBCG) | £48.60 | £93.32 | 47.9% |
| Moonpig Group (LSE:MOON) | £2.18 | £4.02 | 45.7% |
| Marlowe (AIM:MRL) | £4.40 | £8.35 | 47.3% |
| LSL Property Services (LSE:LSL) | £3.11 | £5.95 | 47.8% |
| Informa (LSE:INF) | £8.232 | £15.15 | 45.7% |
| Burberry Group (LSE:BRBY) | £12.04 | £23.71 | 49.2% |
| AstraZeneca (LSE:AZN) | £103.62 | £191.83 | 46% |
| Aptitude Software Group (LSE:APTD) | £2.96 | £5.43 | 45.5% |
Below we spotlight a couple of our favorites from our exclusive screener.
Young's Brewery (AIM:YNGA)
Overview: Young & Co.'s Brewery, P.L.C. operates and manages pubs and hotels in the United Kingdom with a market cap of £519.49 million.
Operations: The company generates revenue primarily through its Managed Houses segment, which accounts for £485 million.
Estimated Discount To Fair Value: 11.4%
Young's Brewery is trading at £9.6, below its estimated fair value of £10.83, indicating potential undervaluation based on cash flows. Recent sales growth, driven by favorable weather and strong performance in gardens and riverside pubs, supports this view. Despite a dip in net income to £9.8 million from the previous year, earnings are forecast to grow significantly at 34.4% annually over the next three years compared to the UK market's 14.5%.
- Insights from our recent growth report point to a promising forecast for Young's Brewery's business outlook.
- Dive into the specifics of Young's Brewery here with our thorough financial health report.
Hollywood Bowl Group (LSE:BOWL)
Overview: Hollywood Bowl Group plc operates ten-pin bowling and mini-golf centers in the United Kingdom and internationally, with a market cap of £421.15 million.
Operations: The company generates revenue of £240.46 million from its recreational activities segment, which includes ten-pin bowling and mini-golf centers.
Estimated Discount To Fair Value: 12.9%
Hollywood Bowl Group is trading at £2.5, below its fair value estimate of £2.87, presenting a potential undervaluation based on cash flows. The company's earnings are forecast to grow 14.5% annually, outpacing the UK market's growth rate, with revenue expected to rise by 6.6% per year. Recent earnings showed a slight decline in net income to £20.63 million despite an increase in sales to £129.25 million for H1 2025 compared to the previous year.
- According our earnings growth report, there's an indication that Hollywood Bowl Group might be ready to expand.
- Navigate through the intricacies of Hollywood Bowl Group with our comprehensive financial health report here.
Vistry Group (LSE:VTY)
Overview: Vistry Group PLC, with a market cap of £2.04 billion, provides housing solutions in the United Kingdom through its various subsidiaries.
Operations: The company's revenue primarily comes from its Home Builders - Residential / Commercial segment, which generated £3.78 billion.
Estimated Discount To Fair Value: 38.8%
Vistry Group is trading at £6.26, significantly below its estimated fair value of £10.23, offering potential undervaluation based on cash flows despite lower profit margins (2%) compared to last year (6%). Earnings are forecast to grow 32.7% annually, outpacing the UK market's 14.5%. The forward order book totals £4.6 billion with secured units increasing to 72% for FY25 delivery, although recent executive changes may impact strategic direction.
- The growth report we've compiled suggests that Vistry Group's future prospects could be on the up.
- Delve into the full analysis health report here for a deeper understanding of Vistry Group.
Key Takeaways
- Dive into all 60 of the Undervalued UK Stocks Based On Cash Flows we have identified here.
- Have you diversified into these companies? Leverage the power of Simply Wall St's portfolio to keep a close eye on market movements affecting your investments.
- Discover a world of investment opportunities with Simply Wall St's free app and access unparalleled stock analysis across all markets.
Contemplating Other Strategies?
- 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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