Three SGX Stocks Estimated To Be Undervalued In July 2024

Amidst a landscape of regulatory challenges and fines in the financial sector, as exemplified by Green Dot's recent $44 million penalty from the Federal Reserve, investors may find it prudent to look for value in other areas of the market. In this context, identifying stocks that appear undervalued could provide opportunities for those looking to invest under current market conditions.

Top 5 Undervalued Stocks Based On Cash Flows In Singapore

Name	Current Price	Fair Value (Est)	Discount (Est)
Singapore Technologies Engineering (SGX:S63)	SGD4.45	SGD7.45	40.3%
Winking Studios (Catalist:WKS)	SGD0.29	SGD0.51	43%
Hongkong Land Holdings (SGX:H78)	US$3.37	US$5.77	41.6%
Frasers Logistics & Commercial Trust (SGX:BUOU)	SGD0.995	SGD1.66	40.2%
Seatrium (SGX:5E2)	SGD1.46	SGD2.62	44.3%
Digital Core REIT (SGX:DCRU)	US$0.64	US$1.12	42.7%
Nanofilm Technologies International (SGX:MZH)	SGD0.935	SGD1.48	36.7%

Click here to see the full list of 7 stocks from our Undervalued SGX Stocks Based On Cash Flows screener.

We'll examine a selection from our screener results.

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 $7.44 billion.

Operations: The company's revenue is derived from two primary segments: investment properties, generating $1.08 billion, and development properties, contributing $0.76 billion.

Estimated Discount To Fair Value: 41.6%

Hongkong Land Holdings, trading at S$3.37, significantly below the estimated fair value of S$5.77, appears undervalued based on cash flows. Despite a low forecasted return on equity of 2.4% in three years and slower revenue growth at 4.6% annually compared to the market average, it is set to become profitable within this period with earnings expected to increase substantially by 45.12% per year. Recent updates indicate stable underlying profits and an improved performance in its luxury retail and Singapore office sectors.

• In light of our recent growth report, it seems possible that Hongkong Land Holdings' financial performance will exceed current levels.
• Click here to discover the nuances of Hongkong Land Holdings with our detailed financial health report.

Nanofilm Technologies International (SGX:MZH)

Overview: Nanofilm Technologies International Limited operates in the field of nanotechnology solutions across Singapore, China, Japan, and Vietnam with a market capitalization of approximately SGD 608.70 million.

Operations: Nanofilm Technologies International's revenue streams include Sydrogen (SGD 1.05 million), Nanofabrication (SGD 16.05 million), Advanced Materials (SGD 141.54 million), and Industrial Equipment (SGD 37.17 million).

Estimated Discount To Fair Value: 36.7%

Nanofilm Technologies International, priced at SGD0.94, is significantly undervalued against a fair value of SGD1.48. The company anticipates robust financial growth in FY2024 with expected revenue and earnings growth outpacing the Singapore market average. However, its return on equity is projected to remain low at 9% over three years, and profit margins have declined from last year's 18.5% to 1.8%. Recent management changes could influence future operations and strategy execution.

• The analysis detailed in our Nanofilm Technologies International growth report hints at robust future financial performance.
• Get an in-depth perspective on Nanofilm Technologies International's balance sheet by reading our health report here.

Singapore Technologies Engineering (SGX:S63)

Overview: Singapore Technologies Engineering Ltd is a global technology, defence, and engineering group with a market capitalization of SGD 13.88 billion.

Operations: The company's revenue is derived from three primary segments: Commercial Aerospace (SGD 3.97 billion), Urban Solutions & Satcom (SGD 1.98 billion), and Defence & Public Security (SGD 4.29 billion).

Estimated Discount To Fair Value: 40.3%

Singapore Technologies Engineering, currently priced at SGD4.45, trades 40.3% below its estimated fair value of SGD7.45, signaling potential undervaluation based on cash flows. While its earnings are projected to grow by 11.7% annually, outpacing the Singapore market's 9.1%, concerns persist due to a high debt level and an unstable dividend track record. Recent corporate actions include a share buyback initiated on May 13, 2024, and an affirmed interim dividend of SGD0.04 per share for Q1 2024.

• The growth report we've compiled suggests that Singapore Technologies Engineering's future prospects could be on the up.
• Delve into the full analysis health report here for a deeper understanding of Singapore Technologies Engineering.

Key Takeaways

• Investigate our full lineup of 7 Undervalued SGX Stocks Based On Cash Flows right here.
• Already own these companies? Bring clarity to your investment decisions by linking up your portfolio with Simply Wall St, where you can monitor all the vital signs of your stocks effortlessly.
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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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