Discover 3 US Stocks That Might Be Trading Below Fair Value

As the U.S. stock market faces declines in major indices, driven by a slump in large-cap tech stocks ahead of Nvidia's earnings report, investors are increasingly looking for opportunities amid the volatility. In this environment, identifying undervalued stocks can be a strategic approach to potentially achieving favorable returns when market conditions stabilize.

Top 10 Undervalued Stocks Based On Cash Flows In The United States

Name	Current Price	Fair Value (Est)	Discount (Est)
Atour Lifestyle Holdings (NasdaqGS:ATAT)	$16.52	$32.92	49.8%
EQT (NYSE:EQT)	$32.60	$64.56	49.5%
Afya (NasdaqGS:AFYA)	$17.29	$34.49	49.9%
California Resources (NYSE:CRC)	$52.15	$103.93	49.8%
Heartland Financial USA (NasdaqGS:HTLF)	$55.26	$109.48	49.5%
Sociedad Química y Minera de Chile (NYSE:SQM)	$37.20	$73.05	49.1%
Progress Software (NasdaqGS:PRGS)	$57.82	$115.03	49.7%
Fluence Energy (NasdaqGS:FLNC)	$17.99	$35.74	49.7%
EVERTEC (NYSE:EVTC)	$33.41	$66.51	49.8%
Vertex Pharmaceuticals (NasdaqGS:VRTX)	$489.73	$961.11	49%

Click here to see the full list of 186 stocks from our Undervalued US Stocks Based On Cash Flows screener.

Let's explore several standout options from the results in the screener.

Enphase Energy (NasdaqGM:ENPH)

Overview: Enphase Energy, Inc. designs, develops, manufactures, and sells home energy solutions for the solar photovoltaic industry both in the United States and internationally, with a market cap of $16.59 billion.

Operations: Revenue from designing, manufacturing, and selling home energy solutions for the solar photovoltaic industry amounted to $1.42 billion.

Estimated Discount To Fair Value: 42%

Enphase Energy, trading at US$123.65, is significantly undervalued based on discounted cash flow analysis with an estimated fair value of US$213.16. Despite recent legal challenges and a dip in profit margins from 20.5% to 9.1%, the company's revenue is forecasted to grow at 19.8% annually, outpacing the US market average of 8.8%. Enphase's earnings are expected to increase by 38.81% per year, supported by strong product launches and favorable tax incentives under the Inflation Reduction Act (IRA).

• Our comprehensive growth report raises the possibility that Enphase Energy is poised for substantial financial growth.
• Click here and access our complete balance sheet health report to understand the dynamics of Enphase Energy.

Molina Healthcare (NYSE:MOH)

Overview: Molina Healthcare, Inc. offers managed healthcare services to low-income families and individuals through Medicaid, Medicare programs, and state insurance marketplaces, with a market cap of $20.50 billion.

Operations: The company's revenue segments include Medicaid at $30.03 billion, Medicare at $5.03 billion, and Marketplace at $2.26 billion.

Estimated Discount To Fair Value: 45.1%

Molina Healthcare, Inc. is trading at a significant discount to its estimated fair value of US$641.75, with current shares priced at US$352.42. Despite a slight dip in net income from US$309 million to US$301 million year-over-year for Q2 2024, revenue increased substantially from US$8.33 billion to US$9.88 billion. The company’s earnings and revenue are forecasted to grow faster than the broader U.S market, making it an attractive undervalued stock based on cash flows.

• Our growth report here indicates Molina Healthcare may be poised for an improving outlook.
• Click to explore a detailed breakdown of our findings in Molina Healthcare's balance sheet health report.

SouthState (NYSE:SSB)

Overview: SouthState Corporation, with a market cap of $7.26 billion, operates as the bank holding company for SouthState Bank, National Association, offering various banking services and products to individuals and businesses.

Operations: SouthState Bank, National Association generates $1.63 billion from its banking operations, providing a range of financial services and products to individuals and businesses.

Estimated Discount To Fair Value: 44.5%

SouthState Corporation is trading at a significant discount to its estimated fair value of US$173.42, with current shares priced at US$96.33. Despite a decline in net interest income from US$743.01 million to US$694.2 million for the first half of 2024, net income rose to US$132.37 million in Q2 2024 from US$123.45 million a year ago. The company's earnings and revenue are forecasted to grow significantly faster than the broader U.S market, highlighting its undervaluation based on cash flows.

• Insights from our recent growth report point to a promising forecast for SouthState's business outlook.
• Get an in-depth perspective on SouthState's balance sheet by reading our health report here.

Key Takeaways

• Discover the full array of 186 Undervalued US Stocks Based On Cash Flows right 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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