Cynergistek and Ossen Innovation are stocks on my list that are potentially undervalued. This means their current share prices are trading well-below what the companies are actually worth. There’s a few ways you can measure the value of a company – you can forecast how much money it will make in the future and base your valuation off of this, or you can look around at its peers of similar size and industry to roughly estimate what it should be worth. Below, I’ve created a list of companies that compare favourably in all criteria based on their most recent financial data, making them potentially good investments.
Cynergistek, Inc. (AMEX:CTEK)
Cynergistek, Inc. provides outsourced document management services and IT security consulting services primarily to the healthcare industry in the United States. The company now has 283 employees and with the company’s market capitalisation at USD $35.82M, we can put it in the small-cap category.
CTEK’s stock is now hovering at around -67% lower than its value of $11.27, at the market price of $3.77, based on its expected future cash flows. The discrepancy signals an opportunity to buy low. In addition to this, CTEK’s PE ratio is around 6.8x compared to its healthcare peer level of 22.4x, suggesting that relative to its comparable set of companies, you can buy CTEK for a cheaper price. CTEK is also in great financial shape, with current assets covering liabilities in the near term and over the long run. It’s debt-to-equity ratio of 119% has been dropping for the last couple of years indicating its ability to pay down its debt.
Ossen Innovation Co., Ltd. (NASDAQ:OSN)
Ossen Innovation Co., Ltd. manufactures and sells various plain surface prestressed steel materials, and rare earth coated and zinc coated prestressed steel materials in the People’s Republic of China. The company size now stands at 191 people and with the stock’s market cap sitting at USD $17.02M, it comes under the small-cap stocks category.
OSN’s stock is currently hovering at around -74% below its real value of $9.97, at a price tag of $2.55, according to my discounted cash flow model. The difference between value and price signals a potential opportunity to buy OSN shares at a discount. Moreover, OSN’s PE ratio is around 3.2x compared to its metals and mining peer level of 15x, suggesting that relative to other stocks in the industry, OSN’s stock can be bought at a cheaper price. OSN is also strong in terms of its financial health, with near-term assets able to cover upcoming and long-term liabilities. The stock’s debt-to equity ratio of 28% has been declining for the last couple of years demonstrating OSN’s capacity to pay down its debt.
IBSG International, Inc. (OTCPK:IBIN)
IBSG International, Inc. provides software, system integration, and application services. IBSG International is currently led by CEO Jim Queen. With a current market cap of USD $124.00, we can put IBIN in the small-cap stocks category
IBIN’s stock is now trading at -100% under its real value of $2.5, at a price of $0, according to my discounted cash flow model. The discrepancy signals an opportunity to buy low. Moreover, IBIN’s PE ratio is trading at 0x against its its software peer level of 31.9x, indicating that relative to its comparable company group, we can purchase IBIN’s shares for cheaper. IBIN is also a financially robust company, as near-term assets sufficiently cover liabilities in the near future as well as in the long run. IBIN has zero debt on its books as well, meaning it has no long term debt obligations to worry about.
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.