Stocks, such as Beijing Chunlizhengda Medical Instruments and Golden Wheel Tiandi Holdings, are trading at a value below what they may actually be worth. 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.
Beijing Chunlizhengda Medical Instruments Co., Ltd. (SEHK:1858)
Beijing Chunlizhengda Medical Instruments Co., Ltd. Formed in 1998, and headed by CEO Chunbao Shi, the company currently employs 441 people and with the company’s market capitalisation at HKD HK$270.69M, we can put it in the small-cap stocks category.
1858’s stock is now trading at -89% lower than its intrinsic value of ¥127.57, at a price tag of ¥14.12, based on its expected future cash flows. The divergence signals an opportunity to buy 1858 shares at a low price. What’s even more appeal is that 1858’s PE ratio stands at 12.5x compared to its medical equipment peer level of 20.1x, indicating that relative to other stocks in the industry, you can buy 1858 for a cheaper price. 1858 also has a healthy balance sheet, as short-term assets amply cover upcoming and long-term liabilities. 1858 also has no debt on its balance sheet, which gives it headroom to grow and financial flexibility. Dig deeper into Beijing Chunlizhengda Medical Instruments here.
Golden Wheel Tiandi Holdings Company Limited (SEHK:1232)
Golden Wheel Tiandi Holdings Company Limited, an investment holding company, owns, develops, and operates integrated commercial and residential properties in the People’s Republic of China. Founded in 1994, and currently lead by Kam Wong, the company currently employs 506 people and with the company’s market cap sitting at HKD HK$1.32B, it falls under the small-cap stocks category.
1232’s stock is now trading at -77% less than its intrinsic value of ¥3.18, at the market price of ¥0.73, based on its expected future cash flows. This mismatch signals an opportunity to buy 1232 shares at a discount. Also, 1232’s PE ratio is currently around 2.4x against its its real estate peer level of 8.6x, implying that relative to its comparable set of companies, you can buy 1232 for a cheaper price. 1232 is also in good financial health, as short-term assets amply cover upcoming and long-term liabilities.
More on Golden Wheel Tiandi Holdings here.
Century Sage Scientific Holdings Limited (SEHK:1450)
Century Sage Scientific Holdings Limited, an investment holding company, primarily provides hardware and software application solutions. Formed in 2007, and currently lead by Chi Sum Lo, the company size now stands at 421 people and with the market cap of HKD HK$275.48M, it falls under the small-cap group.
1450’s stock is currently hovering at around -45% under its intrinsic value of ¥0.49, at a price tag of ¥0.27, according to my discounted cash flow model. The discrepancy signals an opportunity to buy low. Furthermore, 1450’s PE ratio stands at 5x relative to its media peer level of 15.1x, indicating that relative to its comparable set of companies, we can buy 1450’s stock at a cheaper price today. 1450 is also robust in terms of financial health, with short-term assets covering liabilities in the near future as well as in the long run. The stock’s debt-to equity ratio of 63% has been declining for the past few years showing its capability to reduce its debt obligations year on year. Interested in Century Sage Scientific Holdings? Find out more here.
For more financially sound, undervalued companies to add to your portfolio, you can use our free platform to explore our 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.