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3 UK Stocks Estimated To Be Undervalued By 27.1% To 31.9%

In This Article:

The United Kingdom's stock market has recently experienced a downturn, with the FTSE 100 and FTSE 250 indices closing lower amid weak trade data from China and declining commodity prices. As global economic challenges persist, investors may find opportunities in stocks that appear undervalued based on current market conditions. Identifying such stocks requires careful consideration of their intrinsic value relative to their market price, especially in a fluctuating economic environment.

Top 10 Undervalued Stocks Based On Cash Flows In The United Kingdom

Name

Current Price

Fair Value (Est)

Discount (Est)

Brickability Group (AIM:BRCK)

£0.59

£1.04

43.5%

On the Beach Group (LSE:OTB)

£2.605

£4.59

43.3%

Gateley (Holdings) (AIM:GTLY)

£1.36

£2.64

48.5%

Victrex (LSE:VCT)

£9.66

£18.19

46.9%

Duke Capital (AIM:DUKE)

£0.3025

£0.53

43.2%

Deliveroo (LSE:ROO)

£1.406

£2.43

42.2%

Likewise Group (AIM:LIKE)

£0.19

£0.37

48.8%

Nexxen International (AIM:NEXN)

£8.06

£15.27

47.2%

Optima Health (AIM:OPT)

£1.775

£3.31

46.3%

Melrose Industries (LSE:MRO)

£6.434

£11.85

45.7%

Click here to see the full list of 56 stocks from our Undervalued UK Stocks Based On Cash Flows screener.

Let's dive into some prime choices out of the screener.

Warpaint London

Overview: Warpaint London PLC, with a market cap of £331.23 million, produces and sells cosmetics through its subsidiaries.

Operations: The company's revenue is derived from two primary segments: Close-Out, contributing £2.12 million, and Own Brand, generating £96.72 million.

Estimated Discount To Fair Value: 30.4%

Warpaint London is trading at £4.1, below its estimated fair value of £5.89, suggesting it may be undervalued based on cash flows. The company expects revenue of approximately £102 million for 2024 and has completed follow-on equity offerings totaling nearly £15 million, enhancing liquidity. Despite high share price volatility, earnings grew by a very large amount over the past year and are forecast to grow faster than the UK market, indicating potential for future growth.

AIM:W7L Discounted Cash Flow as at Feb 2025
AIM:W7L Discounted Cash Flow as at Feb 2025

NewRiver REIT

Overview: NewRiver REIT plc is a prominent Real Estate Investment Trust focused on acquiring, managing, and developing durable retail assets across the UK, with a market cap of £347.55 million.

Operations: NewRiver REIT generates revenue primarily through its activities in acquiring, managing, and developing robust retail properties across the UK.

Estimated Discount To Fair Value: 31.9%