Stocks recently deemed undervalued include Bel Fuse and NACCO Industries, as they trade at a market price below their true valuations. There’s a few ways you can value a company. The most popular methods include discounting the company’s cash flows it is expected to create in the future, or comparing its price to its peers or the value of its assets. Analysing the most recent financial data, I’ve created a list of companies that compare favourably in all criteria, making them potentially good investments.
Bel Fuse Inc. (NASDAQ:BELF.B)
Bel Fuse Inc. designs, manufactures, markets, and sells products that are used in the networking, telecommunication, high-speed data transmission, commercial aerospace, military, broadcasting, transportation, and consumer electronic industries worldwide. Established in 1949, and now run by Daniel Bernstein, the company size now stands at 7,694 people and with the company’s market capitalisation at USD $232.39M, we can put it in the small-cap category.
BELF.B’s shares are currently floating at around -43% beneath its true level of $32.72, at the market price of $18.65, according to my discounted cash flow model. This mismatch indicates a chance to invest in BELF.B at a discounted price. Furthermore, BELF.B’s PE ratio stands at 18.3x while its electronic peer level trades at 21.8x, suggesting that relative to other stocks in the industry, you can buy BELF.B for a cheaper price. BELF.B is also a financially robust company, with near-term assets able to cover upcoming and long-term liabilities.
More detail on Bel Fuse here.
NACCO Industries, Inc. (NYSE:NC)
NACCO Industries, Inc., through its subsidiaries, primarily operates in the mining industry. Established in 1913, and currently run by John Butler, the company provides employment to 3,600 people and has a market cap of USD $252.62M, putting it in the small-cap stocks category.
NC’s stock is currently trading at -77% under its actual worth of $161.43, at a price of $37.85, based on its expected future cash flows. The mismatch signals a potential chance to invest in NC at a discounted price. Also, NC’s PE ratio is trading at around 6.3x compared to its oil and gas peer level of 14.1x, indicating that relative to other stocks in the industry, NC’s stock can be bought at a cheaper price. NC is also a financially robust company, with near-term assets able to cover upcoming and long-term liabilities. The stock’s debt-to equity ratio of 28% has been dropping for the past few years signifying NC’s capability to pay down its debt. More detail on NACCO Industries here.
Rising Sun Bancorp (OTCPK:RSAM)
Rising Sun Bancorp operates as a holding company for NBRS Financial Bank that provides various banking services to individual and business customers. Rising Sun Bancorp was formed in 1873 and has a market cap of USD $38.61K, putting it in the small-cap group.
RSAM’s shares are now floating at around -100% beneath its actual level of $7.99, at the market price of $0.03, based on its expected future cash flows. This discrepancy signals a potential opportunity to buy RSAM shares at a low price. In addition to this, RSAM’s PE ratio is around 0x while its banks peer level trades at 17x, indicating that relative to its comparable company group, RSAM can be bought at a cheaper price right now. RSAM is also strong financially, as near-term assets sufficiently cover liabilities in the near future as well as in the long run.
Interested in Rising Sun Bancorp? 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.