3 KRX Stocks That Could Be Trading Below Intrinsic Value

The South Korean market has shown positive momentum, rising 1.3% in the past week and 4.1% over the last year, with earnings expected to grow by 30% annually. In this environment, identifying stocks that are trading below their intrinsic value could present opportunities for investors seeking to capitalize on potential growth while minimizing risk.

Top 10 Undervalued Stocks Based On Cash Flows In South Korea

Name	Current Price	Fair Value (Est)	Discount (Est)
Samwha ElectricLtd (KOSE:A009470)	₩46750.00	₩92579.25	49.5%
Cosmecca Korea (KOSDAQ:A241710)	₩79400.00	₩152919.72	48.1%
SK Biopharmaceuticals (KOSE:A326030)	₩109400.00	₩179969.09	39.2%
Lutronic (KOSDAQ:A085370)	₩36700.00	₩63217.94	41.9%
Oscotec (KOSDAQ:A039200)	₩38950.00	₩65156.22	40.2%
Intellian Technologies (KOSDAQ:A189300)	₩56300.00	₩91441.81	38.4%
Shinsung E&GLtd (KOSE:A011930)	₩1618.00	₩2954.62	45.2%
Global Tax Free (KOSDAQ:A204620)	₩3550.00	₩6405.13	44.6%
Hotel ShillaLtd (KOSE:A008770)	₩45950.00	₩82025.15	44%
Kakao Games (KOSDAQ:A293490)	₩17500.00	₩29856.54	41.4%

Click here to see the full list of 33 stocks from our Undervalued KRX Stocks Based On Cash Flows screener.

Let's review some notable picks from our screened stocks.

Cafe24 (KOSDAQ:A042000)

Overview: Cafe24 Corp. operates a global e-commerce platform with a market cap of ₩751.94 billion.

Operations: The company's revenue segments include Transit at ₩42.97 billion, Clothing at ₩21.03 billion, and Internet Business Solution at ₩230.51 billion.

Estimated Discount To Fair Value: 27.6%

Cafe24 is trading at ₩31,100, significantly below its estimated fair value of ₩42,949.56. Despite recent shareholder dilution and a volatile share price, the company has become profitable this year and is expected to see earnings grow by 42.5% annually—outpacing the Korean market's average growth rate of 30.4%. However, one-off items have impacted financial results, affecting the quality of earnings projections.

• According our earnings growth report, there's an indication that Cafe24 might be ready to expand.
• Take a closer look at Cafe24's balance sheet health here in our report.

ZeusLtd (KOSDAQ:A079370)

Overview: Zeus Co.,Ltd. offers semiconductor, robot, and display total solutions both in South Korea and internationally with a market cap of ₩399.76 billion.

Operations: ZeusLtd's revenue primarily comes from its Equipment Division, generating ₩467.14 billion, complemented by its Valve segment with ₩23.67 billion.

Estimated Discount To Fair Value: 30.2%

Zeus Ltd. is trading at ₩12,930, well below its estimated fair value of ₩18,535.77. Despite recent share price volatility and a low forecasted return on equity of 15%, the company has shown strong financial recovery with significant earnings growth from a net loss last year to KRW 6.79 billion in Q2 2024. Additionally, its revenue is expected to grow faster than the Korean market average over the next few years.

• Upon reviewing our latest growth report, ZeusLtd's projected financial performance appears quite optimistic.
• Navigate through the intricacies of ZeusLtd with our comprehensive financial health report here.

SK hynix (KOSE:A000660)

Overview: SK hynix Inc., along with its subsidiaries, is involved in the manufacture, distribution, and sale of semiconductor products across Korea, China, other parts of Asia, the United States, and Europe with a market cap of approximately ₩122.57 trillion.

Operations: The company's revenue from the manufacture and sale of semiconductor products is ₩49.22 billion.

Estimated Discount To Fair Value: 10.3%

SK hynix is trading at ₩184,800, slightly below its estimated fair value of ₩205,922.41. Despite recent share price volatility and a forecasted low return on equity of 18.7%, the company has become profitable this year with net income reaching KRW 4.12 trillion in Q2 2024 from a loss last year. Earnings are expected to grow significantly over the next three years, supported by innovations like their GDDR7 graphics memory product and strategic collaborations.

• Insights from our recent growth report point to a promising forecast for SK hynix's business outlook.
• Delve into the full analysis health report here for a deeper understanding of SK hynix.

Key Takeaways

• Unlock our comprehensive list of 33 Undervalued KRX Stocks Based On Cash Flows by clicking 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.
• Elevate your portfolio with Simply Wall St, the ultimate app for investors seeking global market coverage.

Want To Explore Some Alternatives?

• 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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