Blackhawk Resource and CRH Medical 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. 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.
Blackhawk Resource Corp. (TSXV:BLR)
Blackhawk Resource Corp. is a publicly owned investment manager. Blackhawk Resource was founded in 1986 and with the stock’s market cap sitting at CAD CA$5.56M, it comes under the small-cap category.
BLR’s stock is now floating at around -66% less than its real value of $0.4, at a price tag of $0.14, according to my discounted cash flow model. This discrepancy signals a potential opportunity to buy BLR shares at a low price. What’s even more appeal is that BLR’s PE ratio stands at around 2.6x against its its capital markets peer level of 14.2x, implying that relative to its comparable set of companies, you can purchase BLR’s stock for a lower price right now. BLR is also robust in terms of financial health, as current assets can cover liabilities in the near term and over the long run. BLR also has no debt on its balance sheet, which gives it headroom to grow and financial flexibility.
CRH Medical Corporation (TSX:CRH)
CRH Medical Corporation provides products and services to physicians for the treatment of gastrointestinal diseases in the United States. Established in 2000, and now run by Edward Wright, the company size now stands at 17 people and with the market cap of CAD CA$166.79M, it falls under the small-cap group.
CRH’s stock is now hovering at around -58% lower than its value of $5.39, at the market price of $2.25, based on my discounted cash flow model. This mismatch indicates a potential opportunity to buy low. In terms of relative valuation, CRH’s PE ratio stands at around 19.2x relative to its healthcare equipment and supplies peer level of 39x, indicating that relative to other stocks in the industry, we can invest in CRH at a lower price. CRH is also strong financially, as current assets can cover liabilities in the near term and over the long run. Finally, its debt relative to equity is 52%, which has for the past few years demonstrating CRH’s ability
Celestica Inc. (TSX:CLS)
Celestica Inc. provides supply chain solutions in Canada and internationally. Formed in 1996, and run by CEO Robert Mionis, the company size now stands at 23,000 people and with the company’s market capitalisation at CAD CA$1.95B, we can put it in the small-cap group.
CLS’s shares are now hovering at around -11% lower than its real value of $15.38, at the market price of $13.64, based on my discounted cash flow model. The discrepancy signals an opportunity to buy low. In terms of relative valuation, CLS’s PE ratio is currently around 13.7x while its electronic equipment, instruments and components peer level trades at 38.2x, implying that relative to its competitors, CLS can be bought at a cheaper price right now. CLS is also a financially healthy company, as near-term assets sufficiently cover liabilities in the near future as well as in the long run. Finally, its debt relative to equity is 16%, which has over the past couple of years demonstrating its capacity
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.