Stocks, such as Appliance Recycling Centers of America, trading at a market price below their true values are considered to be undervalued. Smart investors can make money from this discrepancy by buying these shares, because they believe the current market prices will eventually move towards their true value. If you’re looking for capital gains in your next investment, I suggest you take a look at my list of potentially undervalued stocks.
Appliance Recycling Centers of America, Inc. (NASDAQ:ARCI)
Appliance Recycling Centers of America, Inc., together with its subsidiaries, sells and recycles household appliances through a chain of company-owned retail stores under the ApplianceSmart name. Established in 1976, and currently lead by Tony Isaac, the company now has 441 employees and with the stock’s market cap sitting at USD $5.43M, it comes under the small-cap group.
ARCI’s shares are now trading at -33% lower than its true value of $1.18, at a price tag of US$0.79, based on its expected future cash flows. This price and value mismatch indicates a potential opportunity to buy the stock at a low price. Furthermore, ARCI’s PE ratio stands at around 1.04x relative to its Specialty Retail peer level of, 18.5x meaning that relative to its comparable set of companies, you can purchase ARCI’s stock for a lower price right now. ARCI is also in great financial shape, as current assets can cover liabilities in the near term and over the long run. It’s debt-to-equity ratio of 15.07% has been diminishing over time, showing ARCI’s capacity to reduce its debt obligations year on year. More on Appliance Recycling Centers of America here.
Ameriprise Financial, Inc. (NYSE:AMP)
Ameriprise Financial, Inc., through its subsidiaries, provides various financial products and services to individual and institutional clients in the United States and internationally. Founded in 1894, and currently headed by CEO James Cracchiolo, the company size now stands at 13,000 people and with the company’s market capitalisation at USD $20.64B, we can put it in the large-cap stocks category.
AMP’s shares are currently floating at around -32% below its actual level of $206.68, at a price of US$141.31, based on my discounted cash flow model. signalling an opportunity to buy the stock at a low price. In addition to this, AMP’s PE ratio is currently around 14.71x against its its Capital Markets peer level of, 16.05x implying that relative to its comparable set of companies, AMP’s stock can be bought at a cheaper price. AMP is also a financially healthy company, as short-term assets amply cover upcoming and long-term liabilities. It’s debt-to-equity ratio of 95.28% has been falling over the past couple of years revealing AMP’s ability to pay down its debt. Continue research on Ameriprise Financial here.
Hi-Crush Partners LP (NYSE:HCLP)
Hi-Crush Partners LP, together with its subsidiaries, provides proppant and logistics solutions to the energy industry in North America. Established in 2012, and run by CEO Robert Rasmus, the company employs 95 people and with the company’s market cap sitting at USD $962.61M, it falls under the small-cap group.
HCLP’s stock is now hovering at around -59% under its actual worth of $26.45, at a price of US$10.80, according to my discounted cash flow model. The mismatch signals a potential chance to invest in HCLP at a discounted price. What’s even more appeal is that HCLP’s PE ratio is currently around 11.12x relative to its Energy Services peer level of, 23.15x suggesting that relative to other stocks in the industry, HCLP’s shares can be purchased for a lower price. HCLP is also strong financially, as short-term assets amply cover upcoming and long-term liabilities. More on Hi-Crush Partners here.
For more financially sound, undervalued companies to add to your portfolio, explore this interactive list of undervalued stocks.