Stocks, such as Telford Homes and Atalaya Mining, are trading at a value below what they may actually be worth. There’s a few ways you can measure the value of a company – you can forecast how much money it will make in the future and base your valuation off of this, or you can look around at its peers of similar size and industry to roughly estimate what it should be worth. Below, I’ve created a list of companies that compare favourably in all criteria based on their most recent financial data, making them potentially good investments.

Telford Homes Plc (AIM:TEF)

Telford Homes Plc engages in the housebuilding and property development businesses in the United Kingdom. Established in 2000, and currently lead by Jonathan Di-Stefano, the company provides employment to 238 people and with the company’s market capitalisation at GBP £305.15M, we can put it in the small-cap category.

TEF’s stock is now trading at -25% below its value of £5.4, at the market price of UK£4.06, according to my discounted cash flow model. The divergence signals an opportunity to buy TEF shares at a low price. In addition to this, TEF’s PE ratio stands at around 11.18x relative to its Consumer Durables peer level of, 11.61x suggesting that relative to other stocks in the industry, TEF’s shares can be purchased for a lower price. TEF is also a financially robust company, with short-term assets covering liabilities in the near future as well as in the long run. It’s debt-to-equity ratio of 45.96% has been dropping for the last couple of years revealing its ability to reduce its debt obligations year on year. Continue research on Telford Homes here.

Atalaya Mining plc (AIM:ATYM)

Atalaya Mining Plc, together with its subsidiaries, explores for and develops mineral properties in Spain. Founded in 2004, and now run by Alberto Lavandeira Adán, the company provides employment to 370 people and with the market cap of GBP £287.82M, it falls under the small-cap stocks category.

ATYM’s stock is currently hovering at around -83% below its actual worth of €12.84, at a price of UK£2.13, according to my discounted cash flow model. signalling an opportunity to buy the stock at a low price. Moreover, ATYM’s PE ratio stands at around 15.65x against its its index peer level of, 16.44x suggesting that relative to its competitors, you can buy ATYM for a cheaper price. ATYM is also strong financially, as short-term assets amply cover upcoming and long-term liabilities. ATYM has zero debt on its books as well, meaning it has no long term debt obligations to worry about. Interested in Atalaya Mining? Find out more here.

Starvest plc (AIM:SVE)

Starvest plc is a venture capital firm specializing in early stage investments, small company new issues and pre-initial public offering opportunities. Starvest was started in 2000 and has a market cap of GBP £1.13M, putting it in the small-cap stocks category.

SVE’s stock is now trading at -74% beneath its real value of £0.08, at a price tag of UK£0.021, based on my discounted cash flow model. This discrepancy gives us a chance to invest in SVE at a discount. In terms of relative valuation, SVE’s PE ratio stands at 3.33x relative to its Capital Markets peer level of, 15.49x implying that relative to its peers, we can purchase SVE’s shares for cheaper. SVE is also a financially healthy company, as near-term assets sufficiently cover liabilities in the near future as well as in the long run.

Dig deeper into Starvest here.

For more financially sound, undervalued companies to add to your portfolio, explore this interactive list of undervalued stocks.

To help readers see pass the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price sensitive company announcements.

The author is an independent contributor and at the time of publication had no position in the stocks mentioned.