In This Article:
In the current environment, where market volatility remains elevated due to ongoing trade tensions and potential economic slowdowns, investors are closely watching how central banks might respond with monetary policy adjustments. As uncertainty persists, identifying stocks that may be trading below their estimated value can offer opportunities for those focusing on long-term investment strategies.
Top 10 Undervalued Stocks Based On Cash Flows In Canada
| Name | Current Price | Fair Value (Est) | Discount (Est) |
| Computer Modelling Group (TSX:CMG) | CA$7.54 | CA$11.10 | 32.1% |
| Savaria (TSX:SIS) | CA$15.70 | CA$31.13 | 49.6% |
| K92 Mining (TSX:KNT) | CA$11.10 | CA$18.30 | 39.4% |
| Galaxy Digital Holdings (TSX:GLXY) | CA$13.53 | CA$21.52 | 37.1% |
| Thunderbird Entertainment Group (TSXV:TBRD) | CA$1.60 | CA$3.12 | 48.7% |
| Lithium Royalty (TSX:LIRC) | CA$4.85 | CA$9.45 | 48.7% |
| illumin Holdings (TSX:ILLM) | CA$1.93 | CA$3.69 | 47.6% |
| AtkinsRéalis Group (TSX:ATRL) | CA$62.89 | CA$107.77 | 41.6% |
| Theratechnologies (TSX:TH) | CA$2.20 | CA$3.22 | 31.8% |
| CAE (TSX:CAE) | CA$30.56 | CA$50.40 | 39.4% |
Let's explore several standout options from the results in the screener.
Cineplex
Overview: Cineplex Inc., along with its subsidiaries, operates as an entertainment and media company in Canada and internationally, with a market cap of CA$563.23 million.
Operations: The company's revenue is primarily derived from Film Entertainment and Content (CA$1.07 billion), Media (CA$133.80 million), and Location-Based Entertainment (CA$128.62 million).
Estimated Discount To Fair Value: 23.3%
Cineplex is trading at CA$8.88, below its estimated fair value of CA$11.57, indicating a potential undervaluation based on cash flows. Despite negative equity and recent net losses of CAD 37.68 million for 2024, the company is expected to become profitable within three years with earnings forecasted to grow significantly by 89% annually. Recent box office revenue growth further supports its recovery trajectory, although overall revenue has declined slightly year-over-year.
Converge Technology Solutions
Overview: Converge Technology Solutions Corp. offers software-enabled IT and cloud solutions across North America and Europe, with a market cap of CA$1.12 billion.
Operations: The company's revenue segments are divided into North America (CA$2.05 billion), Germany (CA$281.78 million), the UK (CA$246.82 million), and Portage Saas Solutions (CA$9.33 million).