Recent undervalued companies based on their current market price include Acacia Mining and Epwin Group. 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.
Acacia Mining plc (LSE:ACA)
Acacia Mining plc, together with its subsidiaries, mines, processes, and sells gold in Africa. Established in 2010, and now led by CEO Bradley Gordon, the company currently employs 3,085 people and with the company’s market capitalisation at GBP £714.78M, we can put it in the small-cap stocks category.
ACA’s shares are now trading at -58% below its true value of $4.14, at a price tag of $1.74, based on its expected future cash flows. This mismatch indicates a potential opportunity to buy low. Moreover, ACA’s PE ratio is trading at around 7.4x against its its metals and mining peer level of 13.9x, suggesting that relative to its competitors, ACA’s shares can be purchased for a lower price. ACA is also in great financial shape, 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 5%, which has for the past few years revealing ACA’s capacity
Epwin Group PLC (AIM:EPWN)
Epwin Group Plc manufactures and sells building products in the United Kingdom, rest of Europe, and internationally. Started in 1976, and run by CEO Jonathan Bednall, the company currently employs 2,592 people and has a market cap of GBP £112.91M, putting it in the small-cap category.
EPWN’s stock is now trading at -52% under its value of £1.64, at a price of £0.79, based on its expected future cash flows. This price and value mismatch indicates a potential opportunity to buy the stock at a low price. Also, EPWN’s PE ratio is around 6.5x relative to its building products peer level of 12.6x, suggesting that relative to its peers, EPWN’s shares can be purchased for a lower price. EPWN is also strong in terms of its financial health, with near-term assets able to cover upcoming and long-term liabilities. Finally, its debt relative to equity is 38%, which has over the past couple of years revealing its ability
SQS Software Quality Systems AG (AIM:SQS)
SQS Software Quality Systems AG provides end-to-end software and business process quality solutions. Founded in 1982, and currently lead by Diederik Vos, the company currently employs 4,402 people and with the company’s market capitalisation at GBP £168.97M, we can put it in the small-cap stocks category.
SQS’s shares are now floating at around -29% below its true level of €7.32, at a price of €5.21, according to my discounted cash flow model. This mismatch indicates a chance to invest in SQS at a discounted price. Furthermore, SQS’s PE ratio stands at 14.6x against its its it services peer level of 25x, suggesting that relative to other stocks in the industry, you can buy SQS’s shares at a cheaper price. SQS is also strong in terms of its financial health, with short-term assets covering liabilities in the near future as well as in the long run. It’s debt-to-equity ratio of 48% has for the past few years indicating 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.