Companies that trade at market prices below their actual values, such as Hour Glass and HL Global Enterprises, are perceived to be undervalued. There’s a few ways you can value a company. The most popular methods include discounting the company’s cash flows it is expected to create in the future, or comparing its price to its peers or the value of its assets. Analysing the most recent financial data, I’ve created a list of companies that compare favourably in all criteria, making them potentially good investments.

The Hour Glass Limited (SGX:AGS)

The Hour Glass Limited, an investment holding company, retails and distributes watches, jewelry, and other luxury products in South East Asia, Australia, and North East Asia. Hour Glass was started in 1979 and with the market cap of SGD SGD472.36M, it falls under the small-cap category.

AGS’s stock is now hovering at around -54% lower than its intrinsic value of $1.47, at a price tag of S$0.67, according to my discounted cash flow model. This mismatch signals an opportunity to buy AGS shares at a discount. In terms of relative valuation, AGS’s PE ratio is trading at around 9.32x relative to its Specialty Retail peer level of, 10x indicating that relative to other stocks in the industry, AGS’s shares can be purchased for a lower price. AGS also has a healthy balance sheet, with current assets covering liabilities in the near term and over the long run. It’s debt-to-equity ratio of 10.26% has been declining for the past few years signifying its ability to pay down its debt. More detail on Hour Glass here.

HL Global Enterprises Limited (SGX:AVX)

HL Global Enterprises Limited, an investment holding company, operates and manages hotels and restaurants in Malaysia and the People’s Republic of China. HL Global Enterprises was founded in 1961 and with the market cap of SGD SGD49.30M, it falls under the small-cap stocks category.

AVX’s shares are now floating at around -37% less than its actual worth of $0.84, at a price of S$0.53, according to my discounted cash flow model. This difference in price and value gives us a chance to buy low. Furthermore, AVX’s PE ratio is trading at around 0.57x compared to its Hospitality peer level of, 22.61x implying that relative to other stocks in the industry, you can buy AVX for a cheaper price. AVX is also a financially robust company, with near-term assets able to cover upcoming and long-term liabilities. It’s debt-to-equity ratio of 3.05% has been falling over the past couple of years demonstrating AVX’s capability to reduce its debt obligations year on year. More detail on HL Global Enterprises here.