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Japanese Stocks Trading Below Estimated Value In October 2024

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In October 2024, Japan's stock markets experienced a decline, with the Nikkei 225 Index falling by 1.58% and the broader TOPIX Index losing 0.64%, amid easing domestic inflation and speculation about the Bank of Japan's interest rate decisions. This environment presents opportunities for investors to explore stocks trading below their estimated value, as identifying undervalued stocks can be key in navigating fluctuating market conditions effectively.

Top 10 Undervalued Stocks Based On Cash Flows In Japan

Name

Current Price

Fair Value (Est)

Discount (Est)

Hagiwara Electric Holdings (TSE:7467)

¥3445.00

¥6689.20

48.5%

Akatsuki (TSE:3932)

¥2017.00

¥3730.35

45.9%

Eternal Hospitality GroupLtd (TSE:3193)

¥3925.00

¥7698.38

49%

Pilot (TSE:7846)

¥4693.00

¥8886.98

47.2%

Management SolutionsLtd (TSE:7033)

¥1950.00

¥3840.76

49.2%

S-Pool (TSE:2471)

¥369.00

¥693.65

46.8%

Adventure (TSE:6030)

¥3975.00

¥7416.87

46.4%

KeePer Technical Laboratory (TSE:6036)

¥4220.00

¥7829.06

46.1%

NATTY SWANKY holdingsLtd (TSE:7674)

¥3355.00

¥5979.89

43.9%

Mercari (TSE:4385)

¥2389.50

¥4312.29

44.6%

Click here to see the full list of 83 stocks from our Undervalued Japanese Stocks Based On Cash Flows screener.

Here's a peek at a few of the choices from the screener.

Sansan

Overview: Sansan, Inc. is a company that plans, develops, and sells cloud-based solutions in Japan with a market capitalization of ¥295.64 billion.

Operations: The company generates revenue primarily from its Sansan/Bill One Business, which accounts for ¥31.79 billion, and its Eight Business, contributing ¥3.80 billion.

Estimated Discount To Fair Value: 35%

Sansan is currently trading at ¥2,347, significantly below its estimated fair value of ¥3,608.94, indicating it may be undervalued based on cash flows. The company's earnings are expected to grow significantly at 39.3% annually over the next three years, outpacing the Japanese market's growth rate of 8.7%. Despite large one-off items affecting financial results, Sansan's high forecasted return on equity and recent share buyback demonstrate potential for strong future performance.

TSE:4443 Discounted Cash Flow as at Oct 2024
TSE:4443 Discounted Cash Flow as at Oct 2024

Takara Bio

Overview: Takara Bio Inc. operates in the bioindustry, CDMO, and gene therapy sectors across Japan, China, other parts of Asia, the United States, Europe, and internationally with a market cap of approximately ¥128.24 billion.

Operations: The company's revenue segments include the Drug Discovery Company, which generated ¥42.82 billion.