A stock that you can buy at a price below what it is worth is considered undervalued. This is the case for AnAn International and Sino Grandness Food Industry Group. Investors can determine how much a company is worth based on how much money they are expected to make in the future, or compared to the value of their peers. The list I’ve put together below are of stocks that compare favourably on all criteria, which potentially makes them good investments if you believe the price should eventually reflect the stock’s actual value.
AnAn International Limited (SGX:Y35)
AnAn International Limited, an investment holding company, engages in the trading of petrochemical, and fuel oil and petroleum products. AnAn International was established in 2004 and with the company’s market cap sitting at SGD SGD194.73M, it falls under the small-cap stocks category.
Y35’s shares are now trading at -72% less than its true value of $0.17, at the market price of S$0.046, based on its expected future cash flows. The difference between value and price signals a potential opportunity to buy Y35 shares at a discount. In addition to this, Y35’s PE ratio is trading at 13.52x against its its index peer level of, 13.88x suggesting that relative to its comparable company group, Y35’s shares can be purchased for a lower price. Y35 is also strong financially, with current assets covering liabilities in the near term and over the long run. The stock’s debt-to equity ratio of 17.37% has been dropping over time, showing its capacity to pay down its debt. Dig deeper into AnAn International here.
Sino Grandness Food Industry Group Limited (SGX:T4B)
Sino Grandness Food Industry Group Limited, an investment holding company, produces and sells canned vegetables and fruits in the People’s Republic of China, Europe, North America, and internationally. Sino Grandness Food Industry Group was started in 1997 and with the market cap of SGD SGD195.88M, it falls under the small-cap group.
T4B’s shares are now hovering at around -88% less than its actual worth of ¥1.7, at a price of S$0.20, based on my discounted cash flow model. This mismatch indicates a chance to invest in T4B at a discounted price. Moreover, T4B’s PE ratio is trading at 2.64x against its its Food peer level of, 10.96x suggesting that relative to its competitors, T4B’s shares can be purchased for a lower price. T4B is also strong in terms of its financial health, with near-term assets able to cover upcoming and long-term liabilities. Finally, its debt relative to equity is 35.44%, which has been reducing over the past couple of years showing T4B’s capability to reduce its debt obligations year on year. More detail on Sino Grandness Food Industry Group here.