Exploring Value On SGX Three Stocks Estimated To Be Up To 43% Below Intrinsic Value
Reviewed by Simply Wall St
Amidst a global landscape where cyber resilience is becoming increasingly critical, the Singapore market presents unique opportunities for investors seeking value. As we explore undervalued stocks on the SGX, it's essential to consider companies with robust operational frameworks that can withstand not just market fluctuations but also external threats like cyber disruptions, enhancing their long-term investment appeal.
Top 5 Undervalued Stocks Based On Cash Flows In Singapore
| Name | Current Price | Fair Value (Est) | Discount (Est) |
| LHN (SGX:41O) | SGD0.33 | SGD0.37 | 10.9% |
| Singapore Technologies Engineering (SGX:S63) | SGD4.40 | SGD7.43 | 40.8% |
| 17LIVE Group (SGX:LVR) | SGD0.895 | SGD1.53 | 41.5% |
| Hongkong Land Holdings (SGX:H78) | US$3.36 | US$5.72 | 41.3% |
| Frasers Logistics & Commercial Trust (SGX:BUOU) | SGD0.985 | SGD1.66 | 40.8% |
| Winking Studios (Catalist:WKS) | SGD0.305 | SGD0.51 | 40.2% |
| Digital Core REIT (SGX:DCRU) | US$0.565 | US$0.75 | 24.2% |
| Seatrium (SGX:5E2) | SGD1.50 | SGD2.63 | 43% |
| Nanofilm Technologies International (SGX:MZH) | SGD0.875 | SGD1.47 | 40.3% |
We're going to check out a few of the best picks from our screener tool.
Seatrium (SGX:5E2)
Overview: Seatrium Limited specializes in engineering solutions for the offshore, marine, and energy sectors with a market capitalization of SGD 5.11 billion.
Operations: The company generates revenue primarily through its segments in Rigs & Floaters, Repairs & Upgrades, Offshore Platforms, and Specialised Shipbuilding which collectively brought in SGD 7.26 billion, along with a smaller contribution from Ship Chartering at SGD 31.63 million.
Estimated Discount To Fair Value: 43%
Seatrium Limited, currently under investigation by Singapore authorities, nevertheless shows promise based on its financial metrics and recent contract wins. Despite a low forecasted return on equity of 8.2% in three years, the company is expected to become profitable with earnings growing at 72.23% annually. Trading at SGD1.5, significantly below the estimated fair value of SGD2.63, Seatrium offers potential as an undervalued stock based on cash flows, particularly considering its strategic contracts in energy sectors and a robust revenue growth forecast of 8.7% per year.
- According our earnings growth report, there's an indication that Seatrium might be ready to expand.
- Click here to discover the nuances of Seatrium with our detailed financial health report.
Frasers Logistics & Commercial Trust (SGX:BUOU)
Overview: Frasers Logistics & Commercial Trust (SGX:BUOU) is a Singapore-listed real estate investment trust specializing in industrial and commercial properties, with a diverse portfolio valued at approximately S$6.4 billion across Australia, Germany, Singapore, the United Kingdom, and the Netherlands, and a market capitalization of about S$3.70 billion.
Operations: The revenue for Frasers Logistics & Commercial Trust is derived from its extensive portfolio of 107 industrial and commercial properties across five major developed markets.
Estimated Discount To Fair Value: 40.8%
Frasers Logistics & Commercial Trust, despite a recent dip in net income to S$93.59 million from S$118.07 million, remains undervalued based on cash flow analysis. Trading at S$0.99, significantly below the estimated fair value of S$1.66, it suggests potential upside. However, its dividends show instability and debt coverage by operating cash flow is weak. Analysts forecast a substantial 41.17% annual earnings growth and revenue growth outpacing the market at 6.2% annually, indicating recovery prospects despite current financial strains.
- Our expertly prepared growth report on Frasers Logistics & Commercial Trust implies its future financial outlook may be stronger than recent results.
- Get an in-depth perspective on Frasers Logistics & Commercial Trust's balance sheet by reading our health report here.
Hongkong Land Holdings (SGX:H78)
Overview: Hongkong Land Holdings Limited operates in property investment, development, and management across Hong Kong, Macau, Mainland China, Southeast Asia, and other international locations with a market capitalization of approximately $7.41 billion.
Operations: The company's revenue is generated from two main segments: investment properties, which brought in $1.08 billion, and development properties, contributing $0.76 billion.
Estimated Discount To Fair Value: 41.3%
Hongkong Land Holdings, priced at S$3.36, trades significantly below its estimated fair value of S$5.72, marking a potential undervaluation based on cash flow metrics. Despite a stable interim financial performance in 2024 with consistent contributions from its investment and development properties, challenges persist such as a low forecasted return on equity at 2.4%. Nevertheless, revenue growth is expected to surpass the Singapore market average at 4.5% annually, with profitability anticipated within three years.
- In light of our recent growth report, it seems possible that Hongkong Land Holdings' financial performance will exceed current levels.
- Click to explore a detailed breakdown of our findings in Hongkong Land Holdings' balance sheet health report.
Make It Happen
- Navigate through the entire inventory of 9 Undervalued SGX Stocks Based On Cash Flows here.
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Interested In Other Possibilities?
- 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 SGX:5E2
Seatrium
Provides engineering solutions to the offshore, marine, and energy industries.
Excellent balance sheet and good value.
