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Yanzhou Coal Mining and Logan Property Holdings are two of the companies on my list that I consider are undervalued. 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.
Yanzhou Coal Mining Company Limited (SEHK:1171)
Yanzhou Coal Mining Company Limited, together with its subsidiaries, engages in the exploration, mining, washing, processing, and sale of coal in China, Japan, South Korea, and Australia. Started in 1973, and headed by CEO Xiangqian Wu, the company provides employment to 68,550 people and with the market cap of HKD HK$69.78B, it falls under the large-cap group.
1171’s shares are currently trading at -42% lower than its actual worth of ¥17.23, at a price tag of HK$10.00, 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 1171’s PE ratio is trading at around 6.8x relative to its Oil and Gas peer level of, 9.31x implying that relative to its comparable set of companies, you can buy 1171’s shares at a cheaper price. 1171 is also a financially robust company, as short-term assets amply cover upcoming and long-term liabilities.
Dig deeper into Yanzhou Coal Mining here.
Logan Property Holdings Company Limited (SEHK:3380)
Logan Property Holdings Company Limited, an investment holding company, develops, invests in, and constructs properties in the People’s Republic of China. Formed in 1996, and run by CEO Jiande Ji, the company employs 2,350 people and has a market cap of HKD HK$64.31B, putting it in the large-cap group.
3380’s stock is now trading at -70% under its actual worth of ¥39.14, at a price tag of HK$11.72, based on my discounted cash flow model. This mismatch signals an opportunity to buy 3380 shares at a discount. Moreover, 3380’s PE ratio is around 7.88x relative to its Real Estate peer level of, 7.9x meaning that relative to its comparable company group, you can purchase 3380’s stock for a lower price right now. 3380 is also strong in terms of its financial health, with current assets covering liabilities in the near term and over the long run. The stock’s debt-to-equity ratio of 154.80% has been dropping for the past few years revealing its capacity to reduce its debt obligations year on year. Dig deeper into Logan Property Holdings here.