Stock Analysis

3 Stocks That May Be Trading Below Their Estimated Value In January 2025

TSE:6036
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As global markets react to recent political developments and economic shifts, U.S. stocks have been climbing toward record highs, fueled by optimism around trade policies and advancements in artificial intelligence. In this environment of cautious optimism, identifying stocks that might be trading below their estimated value can present opportunities for investors seeking to capitalize on potential market inefficiencies.

Top 10 Undervalued Stocks Based On Cash Flows

NameCurrent PriceFair Value (Est)Discount (Est)
Türkiye Sise Ve Cam Fabrikalari (IBSE:SISE)TRY38.86TRY77.5749.9%
Fevertree Drinks (AIM:FEVR)£6.58£13.1249.9%
Atea (OB:ATEA)NOK139.40NOK278.3749.9%
PDS (NSEI:PDSL)₹492.20₹983.0949.9%
East Side Games Group (TSX:EAGR)CA$0.57CA$1.1450%
Kinaxis (TSX:KXS)CA$170.04CA$339.7049.9%
GemPharmatech (SHSE:688046)CN¥13.06CN¥26.0349.8%
IDP Education (ASX:IEL)A$13.17A$26.3150%
Shinko Electric Industries (TSE:6967)¥5859.00¥11720.1450%
Cavotec (OM:CCC)SEK20.00SEK39.8849.8%

Click here to see the full list of 893 stocks from our Undervalued Stocks Based On Cash Flows screener.

Below we spotlight a couple of our favorites from our exclusive screener.

Geo Holdings (TSE:2681)

Overview: Geo Holdings Corporation operates in the amusement businesses sector in Japan with a market capitalization of ¥70.64 billion.

Operations: Geo Holdings Corporation generates revenue from its Retail Services segment, amounting to ¥417.81 million.

Estimated Discount To Fair Value: 15.5%

Geo Holdings is trading at ¥1873, approximately 15.5% below its estimated fair value of ¥2216.72, suggesting it is undervalued based on cash flows. Despite a volatile share price recently, earnings have grown by 16.5% over the past year and are forecast to grow significantly at 20.6% annually over the next three years, outpacing the Japanese market's growth rate of 8.2%. However, its dividend yield of 1.82% isn't well covered by free cash flows.

TSE:2681 Discounted Cash Flow as at Jan 2025
TSE:2681 Discounted Cash Flow as at Jan 2025

KeePer Technical Laboratory (TSE:6036)

Overview: KeePer Technical Laboratory Co., Ltd. is a Japanese company that develops, manufactures, and sells car coatings, car washing chemicals and equipment, with a market cap of ¥122.54 billion.

Operations: Revenue Segments (in millions of ¥): Car coatings: ¥9,500; Car washing chemicals and equipment: ¥3,200.

Estimated Discount To Fair Value: 40.7%

KeePer Technical Laboratory is trading at ¥4,535, significantly below its estimated fair value of ¥7,652.65, indicating it is undervalued based on cash flows. Despite recent share price volatility, earnings grew by 17.6% last year and are expected to grow annually by 17.56%, surpassing the Japanese market's rate of 8.2%. Recent expansions in Nagasaki and Toyota City could bolster future revenue growth projected at 14.9% per year, outpacing the market's average growth rate.

TSE:6036 Discounted Cash Flow as at Jan 2025
TSE:6036 Discounted Cash Flow as at Jan 2025

Aozora Bank (TSE:8304)

Overview: Aozora Bank, Ltd., along with its subsidiaries, offers a range of banking products and services both in Japan and internationally, with a market cap of ¥329.90 billion.

Operations: The company's revenue segments include the Customer Relations Group with ¥8.51 billion, Structured Finance Group contributing ¥35.68 billion, and International Business Group generating ¥18.24 billion.

Estimated Discount To Fair Value: 28.0%

Aozora Bank is trading at ¥2,397, notably below its estimated fair value of ¥3,327.06, suggesting it is undervalued based on cash flows. Forecasted revenue growth of 15.4% annually surpasses the Japanese market's average and earnings are expected to grow by 72.6% per year as the bank becomes profitable over the next three years. However, challenges include a high bad loans ratio of 2.9% and recent shareholder dilution impacting equity returns.

TSE:8304 Discounted Cash Flow as at Jan 2025
TSE:8304 Discounted Cash Flow as at Jan 2025

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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.

Valuation is complex, but we're here to simplify it.

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About TSE:6036

KeePer Technical Laboratory

Develops, manufactures, and sells car coatings, car washing chemicals and equipment, and other products in Japan.

Flawless balance sheet with reasonable growth potential.

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