Stock Analysis
3 Companies That May Be Trading Below Their Estimated Value
Reviewed by Simply Wall St
As global markets navigate the evolving economic landscape, U.S. stocks have been marching toward record highs, buoyed by optimism around potential trade deals and AI-related developments. Despite these gains, growth stocks have outperformed value shares, highlighting opportunities for investors to explore companies that may be trading below their estimated value. Identifying undervalued stocks often involves assessing a company's fundamentals and market position relative to current economic conditions and investor sentiment.
Top 10 Undervalued Stocks Based On Cash Flows
Name | Current Price | Fair Value (Est) | Discount (Est) |
Subros (BSE:517168) | ₹600.55 | ₹1196.98 | 49.8% |
Round One (TSE:4680) | ¥1302.00 | ¥2590.44 | 49.7% |
Sichuan Injet Electric (SZSE:300820) | CN¥50.58 | CN¥101.14 | 50% |
GlobalData (AIM:DATA) | £1.785 | £3.57 | 49.9% |
74Software (ENXTPA:74SW) | €26.50 | €52.93 | 49.9% |
Solum (KOSE:A248070) | ₩18950.00 | ₩37756.10 | 49.8% |
Fine Foods & Pharmaceuticals N.T.M (BIT:FF) | €6.76 | €13.46 | 49.8% |
GemPharmatech (SHSE:688046) | CN¥13.06 | CN¥26.01 | 49.8% |
Cavotec (OM:CCC) | SEK20.00 | SEK39.86 | 49.8% |
Netum Group Oyj (HLSE:NETUM) | €2.82 | €5.63 | 49.9% |
Here we highlight a subset of our preferred stocks from the screener.
Recordati Industria Chimica e Farmaceutica (BIT:REC)
Overview: Recordati Industria Chimica e Farmaceutica S.p.A. is involved in the research, development, production, and sale of pharmaceuticals both in Italy and internationally, with a market cap of €11.61 billion.
Operations: The company's revenue is derived from two primary segments: Rare Diseases, contributing €789.61 million, and Specialty & Primary Care, generating €1.48 billion.
Estimated Discount To Fair Value: 17%
Recordati Industria Chimica e Farmaceutica appears undervalued based on discounted cash flow analysis, trading at €57.5 against a fair value estimate of €69.28, representing a 17% discount. Despite high debt levels, the company shows robust financial health with earnings growing by 12.7% last year and forecasted to grow at 11.23% annually, outpacing the Italian market's growth rate. Recent buybacks and consistent dividend payments further enhance its investment appeal amidst strong revenue performance.
- Our expertly prepared growth report on Recordati Industria Chimica e Farmaceutica implies its future financial outlook may be stronger than recent results.
- Get an in-depth perspective on Recordati Industria Chimica e Farmaceutica's balance sheet by reading our health report here.
Trial Holdings (TSE:141A)
Overview: Trial Holdings Inc. is a diversified company engaged in retail, logistics, financial/payment services, and retail technology businesses with a market cap of ¥322.67 billion.
Operations: Trial Holdings generates revenue through its operations in retail, logistics, financial/payment services, and retail technology sectors.
Estimated Discount To Fair Value: 43%
Trial Holdings trades at ¥2,646, significantly below its estimated fair value of ¥4,644.99, representing a 43% discount. Despite a forecasted low return on equity of 12.6%, earnings are expected to grow by 21.3% annually, outpacing the Japanese market's growth rate of 8.1%. Recent sales reports show strong year-over-year growth in both comparable and all-store sales figures, reinforcing its potential as an undervalued investment based on cash flows.
- Our earnings growth report unveils the potential for significant increases in Trial Holdings' future results.
- Dive into the specifics of Trial Holdings here with our thorough financial health report.
SBI Sumishin Net Bank (TSE:7163)
Overview: SBI Sumishin Net Bank, Ltd. offers a range of banking products and services to individual and corporate clients in Japan, with a market cap of ¥621.23 billion.
Operations: The company's revenue is primarily derived from the Digital Bank Business, which accounts for ¥69.21 billion, and the THEMIX Business, contributing ¥266 million.
Estimated Discount To Fair Value: 11.3%
SBI Sumishin Net Bank is trading at ¥4,120, slightly below its estimated fair value of ¥4,644.52. Earnings are projected to grow significantly at 21.23% annually, surpassing the Japanese market's growth rate of 8.1%. While revenue growth is slower at 13.4% per year, it remains above the market average of 4.3%. The bank maintains a low allowance for bad loans (71%), though its share price has been highly volatile recently.
- Upon reviewing our latest growth report, SBI Sumishin Net Bank's projected financial performance appears quite optimistic.
- Take a closer look at SBI Sumishin Net Bank's balance sheet health here in our report.
Turning Ideas Into Actions
- Access the full spectrum of 896 Undervalued Stocks Based On Cash Flows by clicking on this link.
- Shareholder in one or more of these companies? Ensure you're never caught off-guard by adding your portfolio in Simply Wall St for timely alerts on significant stock developments.
- Invest smarter with the free Simply Wall St app providing detailed insights into every stock market around the globe.
Looking For Alternative Opportunities?
- 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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About BIT:REC
Recordati Industria Chimica e Farmaceutica
Engages in the research, development, production, and sale of pharmaceuticals in Italy and internationally.