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The United Kingdom's stock market has recently faced challenges, with the FTSE 100 and FTSE 250 indices experiencing declines amid weak trade data from China, highlighting concerns over global demand. As these broader economic factors weigh on the market, identifying stocks that are trading below their fair value can offer potential opportunities for investors seeking to capitalize on undervalued assets in a fluctuating environment.
Top 10 Undervalued Stocks Based On Cash Flows In The United Kingdom
| Name | Current Price | Fair Value (Est) | Discount (Est) |
| ASA International Group (LSE:ASAI) | £0.795 | £1.50 | 47% |
| Gooch & Housego (AIM:GHH) | £3.99 | £7.29 | 45.2% |
| Aptitude Software Group (LSE:APTD) | £2.65 | £5.25 | 49.5% |
| Trainline (LSE:TRN) | £2.698 | £5.25 | 48.6% |
| Deliveroo (LSE:ROO) | £1.203 | £2.24 | 46.3% |
| Vanquis Banking Group (LSE:VANQ) | £0.55 | £1.02 | 45.8% |
| Ibstock (LSE:IBST) | £1.644 | £3.26 | 49.6% |
| Kromek Group (AIM:KMK) | £0.0515 | £0.10 | 49.2% |
| Fintel (AIM:FNTL) | £2.21 | £4.24 | 47.8% |
| CVS Group (AIM:CVSG) | £9.69 | £18.45 | 47.5% |
Here we highlight a subset of our preferred stocks from the screener.
Property Franchise Group
Overview: The Property Franchise Group PLC operates in the United Kingdom, focusing on managing and leasing residential real estate properties, with a market cap of £262.43 million.
Operations: The company generates revenue through the management and leasing of residential real estate properties in the UK.
Estimated Discount To Fair Value: 42.2%
Property Franchise Group is trading at £4.15, significantly below its estimated fair value of £7.18, suggesting it may be undervalued based on cash flows. Earnings are forecast to grow at 29.2% annually, outpacing the UK market's average growth rate of 13.9%. However, profit margins have decreased from last year and revenue growth is expected to be moderate at 13% per year. Recent earnings show a substantial increase in sales but a decline in basic earnings per share.
Ibstock
Overview: Ibstock plc is a UK-based company that manufactures and sells clay and concrete building products for the residential construction sector, with a market cap of £647.76 million.
Operations: The company's revenue segments include £248.76 million from clay products and £117.44 million from concrete products, catering to the residential construction sector in the UK.