Companies with shares trading at a market price below what they are actually worth, such as TTM Technologies and American Equity Investment Life Holding, are deemed 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.
TTM Technologies, Inc. (NASDAQ:TTMI)
TTM Technologies, Inc., together with its subsidiaries, manufactures printed circuit boards (PCBs) worldwide. Established in 1978, and now run by Thomas Edman, the company size now stands at 29,000 people and with the company’s market capitalisation at USD $1.67B, we can put it in the small-cap stocks category.
TTMI’s stock is currently hovering at around -30% beneath its true level of $23.45, at the market price of US$16.53, based on my discounted cash flow model. The divergence signals an opportunity to buy TTMI shares at a low price. Also, TTMI’s PE ratio is trading at 16.63x while its Electronic peer level trades at, 22.06x implying that relative to its comparable set of companies, TTMI’s shares can be purchased for a lower price. TTMI is also a financially robust company, as short-term assets amply cover upcoming and long-term liabilities.
Dig deeper into TTM Technologies here.
American Equity Investment Life Holding Company (NYSE:AEL)
American Equity Investment Life Holding Company, through its subsidiaries, provides life insurance products and services in the United States. Formed in 1995, and headed by CEO John Matovina, the company now has 515 employees and with the market cap of USD $2.61B, it falls under the mid-cap stocks category.
AEL’s shares are currently trading at -33% under its true level of $48.53, at a price of US$32.28, according to my discounted cash flow model. This price and value mismatch indicates a potential opportunity to buy the stock at a low price. In addition to this, AEL’s PE ratio is currently around 11.02x relative to its Insurance peer level of, 14.43x suggesting that relative to its comparable company group, we can buy AEL’s stock at a cheaper price today. AEL is also a financially robust company, with short-term assets covering liabilities in the near future as well as in the long run.
More detail on American Equity Investment Life Holding here.
Cirrus Logic, Inc. (NASDAQ:CRUS)
Cirrus Logic, Inc., a fabless semiconductor company, develops, manufactures, and markets analog and mixed-signal integrated circuits (ICs) for a range of consumer and industrial markets. Started in 1984, and currently headed by CEO Jason Rhode, the company provides employment to 1,596 people and with the stock’s market cap sitting at USD $2.46B, it comes under the mid-cap stocks category.
CRUS’s stock is currently hovering at around -51% lower than its actual worth of $79.41, at a price tag of US$38.74, based on my discounted cash flow model. This discrepancy signals a potential opportunity to buy CRUS shares at a low price. Moreover, CRUS’s PE ratio is trading at 15.16x relative to its Semiconductor peer level of, 24.68x suggesting that relative to its competitors, CRUS can be bought at a cheaper price right now. CRUS also has a healthy balance sheet, as current assets can cover liabilities in the near term and over the long run. CRUS has zero debt on its books as well, meaning it has no long term debt obligations to worry about. More detail on Cirrus Logic 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.