Companies that are recently trading at a market price lower than their real values include Industrial Alliance Insurance and Financial Services and Caldwell Partners International. Investors can benefit from buying these companies while they are discounted, because they gain when the market prices move towards the stocks’ true values. Below is a list of stocks I’ve compiled that are deemed undervalued based on the latest financial data.
Industrial Alliance Insurance and Financial Services Inc. (TSX:IAG)
Industrial Alliance Insurance and Financial Services Inc., doing business as, iA Financial Group, primarily provides various life and health insurance products in Canada. Established in 1892, and now led by CEO Yvon Charest, the company currently employs 5,350 people and has a market cap of CAD CA$5.71B, putting it in the mid-cap stocks category.
IAG’s shares are currently trading at -31% below its actual value of $76.5, at the market price of CA$52.45, based on its expected future cash flows. signalling an opportunity to buy the stock at a low price. Moreover, IAG’s PE ratio stands at around 10.24x compared to its Insurance peer level of, 14.39x suggesting that relative to its competitors, IAG’s stock can be bought at a cheaper price. IAG also has a healthy balance sheet, as current assets can cover liabilities in the near term and over the long run. Finally, its debt relative to equity is 18.17%, which has been declining over time, showing IAG’s capability to pay down its debt. More on Industrial Alliance Insurance and Financial Services here.
The Caldwell Partners International Inc. (TSX:CWL)
The Caldwell Partners International Inc. provides executive search consulting services in Canada, the United States, and Europe. Formed in 1962, and currently run by John Wallace, the company provides employment to 116 people and with the company’s market capitalisation at CAD CA$23.06M, we can put it in the small-cap group.
CWL’s shares are currently trading at -60% under its real value of $2.8, at the market price of CA$1.11, based on my discounted cash flow model. The divergence signals an opportunity to buy CWL shares at a low price. Moreover, CWL’s PE ratio stands at 14.09x compared to its Professional Services peer level of, 19.6x implying that relative to other stocks in the industry, you can purchase CWL’s stock for a lower price right now. CWL is also a financially healthy company, as near-term assets sufficiently cover liabilities in the near future as well as in the long run. CWL has zero debt on its books as well, meaning it has no long term debt obligations to worry about. More on Caldwell Partners International here.
Partner Jet Corp. (TSXV:PJT)
Partner Jet Corp., through its subsidiary, Partner Jet Inc., operates as a full service flight management and aircraft sales company in Canada. Partner Jet was formed in 1987 and with the market cap of CAD CA$2.95M, it falls under the small-cap group.
PJT’s stock is now hovering at around -72% lower than its actual value of $1.15, at the market price of CA$0.33, according to my discounted cash flow model. This mismatch signals an opportunity to buy PJT shares at a discount. Also, PJT’s PE ratio is currently around 5.3x against its its Airlines peer level of, 5.97x implying that relative to its peers, you can purchase PJT’s stock for a lower price right now. PJT is also a financially robust company, as current assets can cover liabilities in the near term and over the long run. PJT has zero debt on its books as well, meaning it has no long term debt obligations to worry about. More detail on Partner Jet here.
For more financially sound, undervalued companies to add to your portfolio, explore this interactive list of undervalued stocks.
To help readers see pass the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price sensitive company announcements.
The author is an independent contributor and at the time of publication had no position in the stocks mentioned.