Recent undervalued companies based on their current market price include Stamford Land and Pacific Century Regional Developments. Smart investors can make money from this discrepancy by buying these shares, because they believe the current market prices will eventually move towards their true value. If you’re looking for capital gains in your next investment, I suggest you take a look at my list of potentially undervalued stocks.
Stamford Land Corporation Ltd (SGX:H07)
Stamford Land Corporation Ltd, an investment holding company, owns, operates, and manages luxury hotels in Singapore, Australia, and New Zealand. Stamford Land was formed in 1935 and with the company’s market capitalisation at SGD SGD445.01M, we can put it in the small-cap stocks category.
H07’s shares are currently hovering at around -58% beneath its intrinsic value of $1.22, at a price of $0.52, based on my discounted cash flow model. This price and value mismatch indicates a potential opportunity to buy the stock at a low price. Also, H07’s PE ratio is trading at 10.8x while its hospitality peer level trades at 27x, meaning that relative to its comparable set of companies, you can buy H07’s shares at a cheaper price. H07 is also strong financially, with current assets covering liabilities in the near term and over the long run. It’s debt-to-equity ratio of 61% has been diminishing for the last couple of years signalling H07’s capacity to reduce its debt obligations year on year. More on Stamford Land here.
Pacific Century Regional Developments Limited (SGX:P15)
Pacific Century Regional Developments Limited, an investment holding company, provides business management and consultancy services primarily in Singapore, Hong Kong, and India. Pacific Century Regional Developments was founded in 1963 and with the company’s market capitalisation at SGD SGD980.40M, we can put it in the small-cap group.
P15’s shares are now trading at -36% lower than its real value of $0.58, at the market price of $0.37, based on my discounted cash flow model. This price and value mismatch indicates a potential opportunity to buy the stock at a low price. What’s even more appeal is that P15’s PE ratio is trading at around 9.1x while its diversified financial peer level trades at 18.1x, implying that relative to its competitors, P15’s shares can be purchased for a lower price. P15 is also in great financial shape, with short-term assets covering liabilities in the near future as well as in the long run.
More detail on Pacific Century Regional Developments here.