KOALA Financial Group and Natural Beauty Bio-Technology are stocks on my list that are potentially undervalued. This means their current share prices are trading well-below what the companies are actually 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.

KOALA Financial Group Limited (SEHK:8226)

KOALA Financial Group Limited, an investment holding company, engages in securities investment, placing, and brokerage activities. The company size now stands at 28 people and with the company’s market cap sitting at HKD HK$247.72M, it falls under the small-cap category.

8226’s stock is now hovering at around -94% below its value of $1.54, at a price of HK$0.089, based on its expected future cash flows. This discrepancy signals a potential opportunity to buy 8226 shares at a low price. Additionally, 8226’s PE ratio is trading at 12.38x while its Commercial Services peer level trades at, 21.98x implying that relative to its competitors, we can buy 8226’s stock at a cheaper price today. 8226 is also robust in terms of financial health, with current assets covering liabilities in the near term and over the long run. Finally, its debt relative to equity is 22.37%, which has been reducing over the past couple of years showing its capability to pay down its debt. More on KOALA Financial Group here.

Natural Beauty Bio-Technology Limited (SEHK:157)

Natural Beauty Bio-Technology Limited, an investment holding company, manufactures and sells skin care, beauty, aroma-therapeutic, and health supplements and make-up products under the Natural Beauty brand. Started in 1976, and currently run by Wen-Chung Hsiao, the company employs 538 people and with the market cap of HKD HK$1.22B, it falls under the small-cap category.

157’s stock is currently hovering at around -53% less than its true level of $1.3, at a price of HK$0.61, based on its expected future cash flows. This discrepancy signals a potential opportunity to buy 157 shares at a low price. Also, 157’s PE ratio is trading at 11.59x compared to its Personal Products peer level of, 18.43x suggesting that relative to other stocks in the industry, you can buy 157 for a cheaper price. 157 is also in good financial health, as near-term assets sufficiently cover liabilities in the near future as well as in the long run. 157 also has no debt on its balance sheet, which gives it headroom to grow and financial flexibility. More on Natural Beauty Bio-Technology here.