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The United Kingdom's stock market, particularly the FTSE 100, has recently experienced downward pressure due to weak trade data from China, highlighting concerns over global economic recovery and its impact on UK-listed companies with significant exposure to Chinese markets. Amid these challenging conditions, identifying undervalued stocks becomes crucial for investors seeking potential opportunities; this article explores three UK stocks currently estimated to be significantly below their intrinsic value.
Top 10 Undervalued Stocks Based On Cash Flows In The United Kingdom
| Name | Current Price | Fair Value (Est) | Discount (Est) |
| TBC Bank Group (LSE:TBCG) | £30.50 | £59.53 | 48.8% |
| Gaming Realms (AIM:GMR) | £0.376 | £0.73 | 48.6% |
| GlobalData (AIM:DATA) | £2.00 | £3.73 | 46.3% |
| On the Beach Group (LSE:OTB) | £1.522 | £3.03 | 49.8% |
| Informa (LSE:INF) | £8.36 | £15.43 | 45.8% |
| Redcentric (AIM:RCN) | £1.19 | £2.37 | 49.7% |
| Auction Technology Group (LSE:ATG) | £4.645 | £8.44 | 45% |
| Quartix Technologies (AIM:QTX) | £1.675 | £3.04 | 44.9% |
| Foxtons Group (LSE:FOXT) | £0.58 | £1.05 | 44.6% |
| Genel Energy (LSE:GENL) | £0.793 | £1.46 | 45.8% |
Let's uncover some gems from our specialized screener.
Fevertree Drinks
Overview: Fevertree Drinks PLC, along with its subsidiaries, develops and sells premium mixer drinks in the UK, US, Europe, and internationally, with a market cap of £860.93 million.
Operations: The company's revenue is primarily generated from its non-alcoholic beverages segment, which accounted for £361.70 million.
Estimated Discount To Fair Value: 42.5%
Fevertree Drinks appears undervalued based on cash flows, trading at £7.38, significantly below its estimated fair value of £12.83. Despite a slight decline in sales to £172.9 million for the first half of 2024, net income surged to £7.6 million from the previous year's £1.1 million, indicating strong profitability growth with earnings expected to rise by over 29% annually—outpacing UK market expectations—though revenue growth remains moderate at 6.3% per year.
NCC Group
Overview: NCC Group plc operates in the cyber and software resilience sector across the United Kingdom, Asia-Pacific, North America, and Europe with a market cap of £485.24 million.
Operations: The company's revenue is derived from two main segments: Cyber Security, contributing £258.50 million, and Escode, accounting for £65.90 million.