Top US Value Stock Picks For January 2025

As the U.S. stock market concludes a strong year with a late downturn, major indices like the Dow and S&P 500 have experienced notable losses in December despite achieving significant gains throughout 2024. In this environment, identifying undervalued stocks becomes particularly important for investors looking to capitalize on potential opportunities amidst fluctuating market conditions.

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

Name	Current Price	Fair Value (Est)	Discount (Est)
First Solar (NasdaqGS:FSLR)	$176.24	$350.71	49.7%
Camden National (NasdaqGS:CAC)	$42.74	$84.45	49.4%
Ally Financial (NYSE:ALLY)	$36.01	$71.71	49.8%
HealthEquity (NasdaqGS:HQY)	$95.95	$189.22	49.3%
Kanzhun (NasdaqGS:BZ)	$13.80	$26.99	48.9%
LifeMD (NasdaqGM:LFMD)	$4.95	$9.82	49.6%
Mr. Cooper Group (NasdaqCM:COOP)	$96.01	$188.12	49%
Progress Software (NasdaqGS:PRGS)	$65.15	$129.60	49.7%
South Atlantic Bancshares (OTCPK:SABK)	$15.94	$30.95	48.5%
Repligen (NasdaqGS:RGEN)	$143.94	$280.90	48.8%

Click here to see the full list of 174 stocks from our Undervalued US Stocks Based On Cash Flows screener.

Underneath we present a selection of stocks filtered out by our screen.

Light & Wonder (NasdaqGS:LNW)

Overview: Light & Wonder, Inc. is a cross-platform games company operating in the United States and internationally, with a market cap of approximately $7.53 billion.

Operations: The company's revenue is derived from three main segments: Gaming at $2.05 billion, Igaming at $293 million, and Sciplay at $821 million.

Estimated Discount To Fair Value: 34.2%

Light & Wonder appears undervalued based on discounted cash flow analysis, trading at US$86.38, below the estimated fair value of US$131.29. Despite lower net income in Q3 2024 compared to the previous year, earnings are forecast to grow significantly at 22.3% annually, outpacing the US market's average growth rate. The company is actively seeking strategic acquisitions and has completed a share buyback worth US$44 million, indicating financial discipline and potential for long-term value enhancement.

• Our expertly prepared growth report on Light & Wonder implies its future financial outlook may be stronger than recent results.
• Get an in-depth perspective on Light & Wonder's balance sheet by reading our health report here.

Bowhead Specialty Holdings (NYSE:BOW)

Overview: Bowhead Specialty Holdings Inc. offers specialty property and casualty insurance products in the United States with a market cap of $1.13 billion.

Operations: The company generates revenue of $389.14 million from its specialty property and casualty insurance products in the United States.

Estimated Discount To Fair Value: 27.8%

Bowhead Specialty Holdings is trading at US$35.52, significantly below its estimated fair value of US$49.23, suggesting it is undervalued based on discounted cash flow analysis. Recent earnings show strong revenue growth, with a 50.1% increase over the past year and projected annual earnings growth of 37.6%, surpassing the US market's average growth rate. The company's inclusion in the S&P Global BMI Index highlights its growing prominence in the financial landscape.

• Our earnings growth report unveils the potential for significant increases in Bowhead Specialty Holdings' future results.
• Take a closer look at Bowhead Specialty Holdings' balance sheet health here in our report.

Rocket Companies (NYSE:RKT)

Overview: Rocket Companies, Inc. is a fintech holding company that offers mortgage lending, title and settlement services, and other financial technology services in the United States and Canada, with a market cap of approximately $22 billion.

Operations: The company's revenue is primarily derived from its Direct to Consumer segment, which generated $3.16 billion, followed by the Partner Network segment with $864.55 million.

Estimated Discount To Fair Value: 19.8%

Rocket Companies is trading at US$11.26, below its estimated fair value of US$14.04, indicating it is undervalued based on discounted cash flow analysis. Despite a recent quarterly revenue drop to US$646.95 million and a net loss of US$22.01 million, the company is forecasted to achieve significant revenue growth of 22.2% annually and become profitable within three years, outperforming market averages in both metrics while maintaining strategic AI advancements in its operations.

• Upon reviewing our latest growth report, Rocket Companies' projected financial performance appears quite optimistic.
• Dive into the specifics of Rocket Companies here with our thorough financial health report.

Seize The Opportunity

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Ready To Venture Into Other Investment Styles?

• 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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