ConvaTec Group And 2 Other UK Stocks That May Be Priced Below Their Estimated Value

As the United Kingdom's FTSE 100 index experiences fluctuations influenced by weak trade data from China, investors are closely examining opportunities within the market. In such a climate, identifying undervalued stocks can be crucial for those looking to capitalize on potential growth, especially when broader economic indicators suggest volatility.

Top 10 Undervalued Stocks Based On Cash Flows In The United Kingdom

Name	Current Price	Fair Value (Est)	Discount (Est)
Gaming Realms (AIM:GMR)	£0.383	£0.73	47.6%
Victorian Plumbing Group (AIM:VIC)	£1.12	£2.07	45.9%
Barratt Redrow (LSE:BTRW)	£4.029	£7.39	45.4%
On the Beach Group (LSE:OTB)	£1.542	£2.98	48.3%
Informa (LSE:INF)	£8.27	£15.31	46%
Calnex Solutions (AIM:CLX)	£0.605	£1.11	45.3%
Foxtons Group (LSE:FOXT)	£0.524	£1.02	48.7%
Redcentric (AIM:RCN)	£1.1725	£2.26	48.2%
Auction Technology Group (LSE:ATG)	£4.47	£8.47	47.2%
Genel Energy (LSE:GENL)	£0.801	£1.53	47.7%

Click here to see the full list of 47 stocks from our Undervalued UK Stocks Based On Cash Flows screener.

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

ConvaTec Group (LSE:CTEC)

Overview: ConvaTec Group PLC develops, manufactures, and sells medical products, services, and technologies across Europe, North America, and internationally with a market cap of £5.25 billion.

Operations: The company's revenue primarily stems from its development, manufacture, and sale of medical products and technologies, generating $2.20 billion.

Estimated Discount To Fair Value: 39%

ConvaTec Group is trading at £2.56, significantly below its estimated fair value of £4.20, indicating it may be undervalued based on cash flows. Despite a high debt level, earnings are expected to grow significantly at 20.86% annually over the next three years, outpacing the UK market's growth rate of 14.6%. Recent earnings grew by 117.9%, and revenue is forecast to increase by 5.8% per year, surpassing the UK market's average growth rate of 3.6%.

• Our earnings growth report unveils the potential for significant increases in ConvaTec Group's future results.
• Delve into the full analysis health report here for a deeper understanding of ConvaTec Group.

Sage Group (LSE:SGE)

Overview: The Sage Group plc, along with its subsidiaries, offers technology solutions and services to small and medium businesses across the United States, the United Kingdom, France, and internationally, with a market cap of approximately £10.65 billion.

Operations: The company's revenue segments include £595 million from Europe, £1.01 billion from North America, and £488 million from the United Kingdom & Ireland.

Estimated Discount To Fair Value: 15.9%

Sage Group, trading at £10.69, is below its estimated fair value of £12.71, suggesting potential undervaluation based on cash flows. Earnings are forecast to grow by 15.1% annually, surpassing the UK market's growth rate of 14.6%. Despite a high debt level, Sage's recent partnership with Artis Trade Systems enhances its AI capabilities and broadens its partner ecosystem reach, potentially driving operational efficiency and new revenue streams for clients in secured finance and other sectors.

• Insights from our recent growth report point to a promising forecast for Sage Group's business outlook.
• Dive into the specifics of Sage Group here with our thorough financial health report.

Smith & Nephew (LSE:SN.)

Overview: Smith & Nephew plc develops, manufactures, markets, and sells medical devices and services globally, with a market cap of approximately £8.30 billion.

Operations: The company's revenue is derived from three primary segments: Orthopaedics ($2.26 billion), Sports Medicine & ENT ($1.77 billion), and Advanced Wound Management (AWM) ($1.61 billion).

Estimated Discount To Fair Value: 41%

Smith & Nephew, trading at £9.51, is significantly undervalued based on cash flows with a fair value estimate of £16.13. Earnings are projected to grow 22.5% annually, outpacing the UK market's growth rate of 14.6%. Despite high debt and a dividend not well covered by earnings or cash flows, recent advancements like the JointVue partnership enhance its surgical technology offerings, potentially improving patient outcomes and operational efficiency in robotic-assisted knee surgeries.

• The growth report we've compiled suggests that Smith & Nephew's future prospects could be on the up.
• Take a closer look at Smith & Nephew's balance sheet health here in our report.

Summing It All Up

• Investigate our full lineup of 47 Undervalued UK Stocks Based On Cash Flows right here.
• Are you invested in these stocks already? Keep abreast of every twist and turn by setting up a portfolio with Simply Wall St, where we make it simple for investors like you to stay informed and proactive.
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Seeking Other Investments?

• 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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