Cabbeen Fashion and FSE Engineering Holdings are two of the companies on my list that I consider are undervalued. 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.

Cabbeen Fashion Limited (SEHK:2030)

Cabbeen Fashion Limited, a fashion casual menswear company, engages in the research and design of apparel, footwear, and accessories in the People’s Republic of China. Founded in 1997, and headed by CEO Siu Ng, the company provides employment to 402 people and with the company’s market cap sitting at HKD HK$1.44B, it falls under the small-cap stocks category.

2030’s stock is now trading at -78% less than its actual level of ¥9.82, at a price of HK$2.16, according to my discounted cash flow model. The divergence signals an opportunity to buy 2030 shares at a low price. Furthermore, 2030’s PE ratio stands at around 5.96x while its Luxury peer level trades at, 14.15x suggesting that relative to its comparable company group, you can buy 2030 for a cheaper price. 2030 is also strong in terms of its financial health, as short-term assets amply cover upcoming and long-term liabilities. It’s debt-to-equity ratio of 27.30% has been falling for the past few years showing its capability to pay down its debt. Continue research on Cabbeen Fashion here.

FSE Engineering Holdings Limited (SEHK:331)

FSE Engineering Holdings Limited, an investment holding company, provides mechanical and electrical engineering services in Hong Kong, Mainland China, and Macau. Founded in 2015, and headed by CEO Lock Kee Poon, the company now has 1,655 employees and with the market cap of HKD HK$1.13B, it falls under the small-cap category.

331’s stock is now hovering at around -45% beneath its true value of $4.56, at the market price of HK$2.51, according to my discounted cash flow model. The mismatch signals a potential chance to invest in 331 at a discounted price. Moreover, 331’s PE ratio is around 6.5x while its Construction peer level trades at, 10.39x meaning that relative to its competitors, 331 can be bought at a cheaper price right now. 331 is also a financially robust company, with near-term assets able to cover upcoming and long-term liabilities. 331 also has no debt on its balance sheet, which gives it headroom to grow and financial flexibility. Interested in FSE Engineering Holdings? Find out more here.