Stocks, such as Asanko Gold and Mackenzie Master Limited Partnership, are trading at a value below what they may actually be worth. 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.
Asanko Gold Inc. (TSX:AKG)
Asanko Gold Inc. engages in the exploration, development, and production of gold properties. Formed in 1999, and currently headed by CEO Peter Breese, the company currently employs 380 people and has a market cap of CAD CA$229.90M, putting it in the small-cap stocks category.
AKG’s stock is currently hovering at around -71% less than its actual value of $3.78, at a price tag of CA$1.11, according to my discounted cash flow model. The difference between value and price signals a potential opportunity to buy AKG shares at a discount.
AKG is also strong financially, as current assets can cover liabilities in the near term and over the long run.
Dig deeper into Asanko Gold here.
Mackenzie Master Limited Partnership (TSX:MKZ.UN)
Mackenzie Master Limited Partnership pays selling commissions to financial advisors who sell redemption charge securities of Mackenzie mutual funds for specific periods. The company was established in 1995 and has a market cap of CAD CA$6.08M, putting it in the small-cap category.
MKZ.UN’s shares are now floating at around -58% beneath its true value of $2.28, at the market price of CA$0.96, based on my discounted cash flow model. The discrepancy signals an opportunity to buy low. What’s even more appeal is that MKZ.UN’s PE ratio is currently around 6.49x compared to its Capital Markets peer level of, 13.93x suggesting that relative to its peers, you can purchase MKZ.UN’s stock for a lower price right now. MKZ.UN is also strong financially, as short-term assets amply cover upcoming and long-term liabilities. MKZ.UN also has no debt on its balance sheet, which gives it headroom to grow and financial flexibility. More detail on Mackenzie Master Limited Partnership here.
Airboss of America Corp. (TSX:BOS)
AirBoss of America Corp., through its subsidiaries, develops, manufactures, and sells rubber-based products to the resource, military, automotive, and industrial markets primarily in Canada and the United States. The company currently employs 1028 people and with the company’s market cap sitting at CAD CA$236.17M, it falls under the small-cap category.
BOS’s stock is currently floating at around -39% lower than its real value of $16.82, at a price tag of CA$10.24, based on my discounted cash flow model. This mismatch signals an opportunity to buy BOS shares at a discount. Moreover, BOS’s PE ratio is trading at around 18.26x compared to its Chemicals peer level of, 18.42x implying that relative to its competitors, you can buy BOS for a cheaper price. BOS is also robust in terms of financial health, with current assets covering liabilities in the near term and over the long run.
More detail on Airboss of America 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.