In This Article:
The United Kingdom's stock market has recently faced challenges, with the FTSE 100 index slipping due to weak trade data from China, highlighting concerns over global economic recovery. In this environment, identifying undervalued stocks can be a strategic approach for investors seeking potential opportunities amidst broader market fluctuations.
Top 10 Undervalued Stocks Based On Cash Flows In The United Kingdom
| Name | Current Price | Fair Value (Est) | Discount (Est) |
| Gaming Realms (AIM:GMR) | £0.358 | £0.66 | 45.7% |
| On the Beach Group (LSE:OTB) | £2.33 | £4.60 | 49.4% |
| JD Sports Fashion (LSE:JD.) | £0.7794 | £1.51 | 48.5% |
| Ferrexpo (LSE:FXPO) | £0.816 | £1.58 | 48.4% |
| Likewise Group (AIM:LIKE) | £0.185 | £0.37 | 49.8% |
| Harbour Energy (LSE:HBR) | £1.9525 | £3.67 | 46.8% |
| Victrex (LSE:VCT) | £9.92 | £18.30 | 45.8% |
| Vanquis Banking Group (LSE:VANQ) | £0.572 | £1.13 | 49.6% |
| TI Fluid Systems (LSE:TIFS) | £1.968 | £3.77 | 47.7% |
| Kromek Group (AIM:KMK) | £0.0585 | £0.11 | 48.4% |
Let's dive into some prime choices out of the screener.
Warpaint London
Overview: Warpaint London PLC, with a market cap of £304.97 million, produces and sells cosmetics through its subsidiaries.
Operations: The company's revenue segments include £2.12 million from Close-Out sales and £96.72 million from Own Brand products.
Estimated Discount To Fair Value: 34.2%
Warpaint London is trading at £3.78, significantly below its estimated fair value of £5.74, indicating it may be undervalued based on cash flows. The company's revenue is forecast to grow by 16.4% annually, outpacing the UK market's 3.8%. Despite a highly volatile share price recently and a dividend not well covered by free cash flows, analysts expect a potential price increase of 76.6%, with earnings projected to grow faster than the market average at 15.3% per year.
AstraZeneca
Overview: AstraZeneca PLC is a biopharmaceutical company engaged in the discovery, development, manufacture, and commercialization of prescription medicines with a market cap of approximately £183.68 billion.
Operations: AstraZeneca's revenue primarily comes from its biopharmaceuticals segment, which generated $54.07 billion.
Estimated Discount To Fair Value: 45.5%
AstraZeneca appears undervalued with its current trading price of £118.46 below the estimated fair value of £217.18, suggesting potential for growth based on cash flows. The company is expected to see earnings grow at 16% annually, outpacing the UK market's 14.2%. Recent strategic alliances and successful clinical trials, such as those involving eneboparatide and Imfinzi, highlight AstraZeneca's commitment to innovation despite a high debt level which may impact financial flexibility.