A stock that you can buy at a price below what it is worth is considered undervalued. This is the case for Joyce and Zimplats Holdings. Investors can determine how much a company is worth based on how much money they are expected to make in the future, or compared to the value of their peers. The list I’ve put together below are of stocks that compare favourably on all criteria, which potentially makes them good investments if you believe the price should eventually reflect the stock’s actual value.
Joyce Corporation Ltd (ASX:JYC)
Joyce Corporation Ltd retails kitchen and wardrobe products in Australia. Established in 1886, and now led by CEO , the company currently employs 78 people and with the company’s market capitalisation at AUD A$40.00M, we can put it in the small-cap group.
JYC’s shares are currently floating at around -81% less than its actual value of $7.52, at the market price of AU$1.45, according to my discounted cash flow model. The difference between value and price signals a potential opportunity to buy JYC shares at a discount. What’s even more appeal is that JYC’s PE ratio is currently around 13.54x compared to its Specialty Retail peer level of, 16.34x suggesting that relative to other stocks in the industry, JYC’s stock can be bought at a cheaper price. JYC is also strong in terms of its financial health, as current assets can cover liabilities in the near term and over the long run.
Dig deeper into Joyce here.
Zimplats Holdings Limited (ASX:ZIM)
Zimplats Holdings Limited, together with its subsidiaries, engages in the mining, processing, and production of platinum group and associated metals from the Great Dyke in Zimbabwe. The company now has 3053 employees and with the company’s market cap sitting at AUD A$645.83M, it falls under the small-cap stocks category.
ZIM’s shares are currently hovering at around -31% less than its actual value of $8.67, at the market price of AU$6.00, according to my discounted cash flow model. This mismatch indicates a potential opportunity to buy low. In addition to this, ZIM’s PE ratio is currently around 9.49x while its Metals and Mining peer level trades at, 12.84x implying that relative to its peers, ZIM’s shares can be purchased for a lower price. ZIM is also in great financial shape, as current assets can cover liabilities in the near term and over the long run. Finally, its debt relative to equity is 8.39%, which has been declining over time, demonstrating its ability to pay down its debt. Interested in Zimplats Holdings? Find out more here.
Simonds Group Limited (ASX:SIO)
Simonds Group Limited operates as an integrated homebuilder and registered training organization in Australia. Formed in 1949, and headed by CEO Kelvin Ryan, the company size now stands at 520 people and with the company’s market cap sitting at AUD A$51.78M, it falls under the small-cap stocks category.
SIO’s stock is currently trading at -63% beneath its actual value of $0.97, at the market price of AU$0.36, according to my discounted cash flow model. The discrepancy signals an opportunity to buy low. Additionally, SIO’s PE ratio is trading at 13.18x compared to its Consumer Durables peer level of, 15.48x implying that relative to its comparable company group, you can buy SIO for a cheaper price. SIO is also a financially healthy company, with near-term assets able to cover upcoming and long-term liabilities. Continue research on Simonds Group 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.