Top 3 Undervalued Stocks For The Month
Undervalued companies are those that trade at a price lower than their actual values, such as Dart Group and Keller Group. There’s a few ways you can determine how much a company is actually worth. 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. The discrepancy between the price and value means investors have an opportunity to buy shares at a discount. Below are the stocks I believe are undervalued on all criteria, based on their latest financial data.
Dart Group PLC (AIM:DTG)
Dart Group PLC, together with its subsidiaries, engages in leisure travel, and distribution and logistics businesses in Europe. Founded in 1971, and currently run by , the company currently employs 6,322 people and with the company’s market cap sitting at GBP £1.28B, it falls under the small-cap stocks category.
DTG’s stock is now floating at around -27% under its actual value of £11.76, at a price tag of UK£8.60, based on its expected future cash flows. The divergence signals an opportunity to buy DTG shares at a low price. Moreover, DTG’s PE ratio stands at around 10.93x while its index peer level trades at, 16.73x implying that relative to its comparable company group, we can purchase DTG’s shares for cheaper. DTG is also in great financial shape, as short-term assets amply cover upcoming and long-term liabilities.
Dig deeper into Dart Group here.
Keller Group plc (LSE:KLR)
Keller Group plc provides geotechnical solutions in North America, Europe, the Middle East, Africa, and the Asia-Pacific. Established in 1860, and currently lead by Alain Michaelis, the company employs 9,608 people and has a market cap of GBP £683.26M, putting it in the small-cap stocks category.
KLR’s stock is currently hovering at around -26% less than its intrinsic level of £12.85, at the market price of UK£9.46, based on its expected future cash flows. This mismatch indicates a potential opportunity to buy low. Furthermore, KLR’s PE ratio stands at around 7.82x compared to its Construction peer level of, 12.29x implying that relative to its competitors, you can buy KLR for a cheaper price. KLR is also a financially healthy company, with near-term assets able to cover upcoming and long-term liabilities.
Continue research on Keller Group here.
London Finance & Investment Group P.L.C. (LSE:LFI)
London Finance & Investment Group P.L.C., together with its subsidiaries, operates as an investment finance and management company. London Finance & Investment Group is headed by CEO . It currently has a market cap of GBP £13.42M placing it in the small-cap category
LFI’s shares are currently hovering at around -24% less than its actual worth of £0.56, at the market price of UK£0.42, according to my discounted cash flow model. This price and value mismatch indicates a potential opportunity to buy the stock at a low price. Additionally, LFI’s PE ratio is trading at 8.31x against its its Capital Markets peer level of, 15.56x meaning that relative to its competitors, LFI’s shares can be purchased for a lower price. LFI is also a financially healthy company, with current assets covering liabilities in the near term and over the long run. LFI also has no debt on its balance sheet, which gives it headroom to grow and financial flexibility. Dig deeper into London Finance & Investment Group 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.
