March Top Undervalued Real Estate Stocks To Look Out For
The real estate sector performs relatively in-line with the wider economy. Prosperous periods bring about high growth and inflation, leading to strong returns in real estate investments. HKC (Holdings) and Jingrui Holdings are real estate stocks on my list that are potentially undervalued, which means their current share prices are trading well-below what the companies are actually worth. Investors can profit from the difference by investing in these cyclical stocks as the current market prices should eventually move towards their true values. If capital gains are what you’re after in your next investment, I’ve put together a list of undervalued stocks you may be interested in, based on the latest financial data from each company.
HKC (Holdings) Limited (SEHK:190)
HKC (Holdings) Limited, together with its subsidiaries, engages in the property development and investment, and renewable energy investment and operation businesses primarily in the People’s Republic of China. The company now has 267 employees and with the company’s market cap sitting at HKD HK$2.95B, it falls under the mid-cap stocks category.
190’s shares are currently hovering at around -91% under its true value of $59, at the market price of HK$5.57, based on its expected future cash flows. This mismatch indicates a potential opportunity to buy low. Additionally, 190’s PE ratio is currently around 3.28x compared to its Real Estate peer level of, 7.8x indicating that relative to other stocks in the industry, you can purchase 190’s stock for a lower price right now. 190 is also strong in terms of its financial health, as current assets can cover liabilities in the near term and over the long run. The stock’s debt-to-equity ratio of 17.52% has been falling over time, signalling 190’s capability to reduce its debt obligations year on year. Continue research on HKC (Holdings) here.
Jingrui Holdings Limited (SEHK:1862)
Jingrui Holdings Limited, an investment holding company, engages in property development business in the People’s Republic of China. Founded in 1993, and currently lead by Hao Yan, the company employs 2,743 people and with the company’s market capitalisation at HKD HK$4.20B, we can put it in the mid-cap group.
1862’s shares are currently trading at -93% lower than its actual value of ¥47.65, at the market price of HK$3.25, based on my discounted cash flow model. This discrepancy signals a potential opportunity to buy 1862 shares at a low price. Furthermore, 1862’s PE ratio is currently around 4.19x while its Real Estate peer level trades at, 7.8x meaning that relative to its comparable company group, you can purchase 1862’s stock for a lower price right now. 1862 is also a financially robust company, as current assets can cover liabilities in the near term and over the long run.
More on Jingrui Holdings here.
Spring Real Estate Investment Trust (SEHK:1426)
Spring Real Estate Investment Trust (“Spring REIT”, stock code: 1426) is a real estate investment trust which invests in high quality income-producing real estate. Spring Real Estate Investment Trust is headed by CEO Nobumasa Saeki. With the stock’s market cap sitting at HKD HK$4.31B, it falls under the mid-cap stocks category
1426’s shares are now floating at around -91% below its real value of $39, at a price of HK$3.43, according to my discounted cash flow model. The discrepancy signals an opportunity to buy low. Furthermore, 1426’s PE ratio stands at 9.56x against its its index peer level of, 13.59x implying that relative to its comparable set of companies, we can purchase 1426’s shares for cheaper. 1426 is also strong financially, as current assets can cover liabilities in the near term and over the long run.
Interested in Spring Real Estate Investment Trust? Find out more 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.
