Undervalued companies, such as Socket Mobile and VSE, trade at a price less than their true values. Investors can benefit from buying these companies while they are discounted, because they gain when the market prices move towards the stocks’ true values. Below is a list of stocks I’ve compiled that are deemed undervalued based on the latest financial data.
Socket Mobile, Inc. (NASDAQ:SCKT)
Socket Mobile, Inc. produces data capture products for mobile applications used in business mobility markets in the United States, Europe, Asia, and internationally. Established in 1992, and run by CEO Kevin Mills, the company provides employment to 53 people and with the company’s market cap sitting at USD $25.03M, it falls under the small-cap category.
SCKT’s stock is currently floating at around -47% under its actual level of $6.53, at the market price of $3.46, based on its expected future cash flows. This mismatch signals an opportunity to buy SCKT shares at a discount. In terms of relative valuation, SCKT’s PE ratio is around 1.8x against its its technology hardware, storage and peripherals peer level of 18.8x, meaning that relative to its competitors, we can purchase SCKT’s shares for cheaper. SCKT is also robust in terms of financial health, as near-term assets sufficiently cover liabilities in the near future as well as in the long run. SCKT also has a miniscule amount of debt on its balance sheet, which gives it headroom to grow and financial flexibility.
VSE Corporation (NASDAQ:VSEC)
VSE Corporation operates as a diversified services and supply company in the United States. Founded in 1959, and currently headed by CEO Maurice Gauthier, the company provides employment to 2,523 people and with the company’s market cap sitting at USD $520.79M, it falls under the small-cap stocks category.
VSEC’s stock is now trading at -46% less than its intrinsic level of $87.97, at the market price of $47.91, according to my discounted cash flow model. This discrepancy signals a potential opportunity to buy VSEC shares at a low price. Moreover, VSEC’s PE ratio is trading at around 17.9x compared to its commercial services and supplies peer level of 24.3x, meaning that relative to other stocks in the industry, VSEC’s shares can be purchased for a lower price. VSEC is also in good financial health, with short-term assets covering liabilities in the near future as well as in the long run. The stock’s debt-to equity ratio of 73% has been dropping over time, showing its capability to pay down its debt.
Acacia Research Corporation (NASDAQ:ACTG)
Acacia Research Corporation, through its subsidiaries, invests in, develops, licenses, and enforces patented technologies in the United States. Established in 1992, and now led by CEO Robert Stewart, the company provides employment to 27 people and with the market cap of USD $217.60M, it falls under the small-cap stocks category.
ACTG’s shares are now trading at -67% less than its value of $12.6, at a price of $4.2, according to my discounted cash flow model. This discrepancy signals a potential opportunity to buy ACTG shares at a low price. In addition to this, ACTG’s PE ratio is around 1.7x compared to its professional services peer level of 25x, implying that relative to its comparable company group, ACTG’s stock can be bought at a cheaper price. ACTG is also in good financial health, with near-term assets able to cover upcoming and long-term liabilities. ACTG also has no debt on its balance sheet, which gives it headroom to grow and financial flexibility.
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.