Companies that are recently trading at a market price lower than their real values include TrueBlue and JinkoSolar Holding. There’s a few ways you can determine how much a company is actually worth. 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. The discrepancy between the price and value means investors have an opportunity to buy shares at a discount. Below are the stocks I believe are undervalued on all criteria, based on their latest financial data.
TrueBlue, Inc. (NYSE:TBI)
TrueBlue, Inc. provides contingent staffing, recruitment process outsourcing, and contingent staffing management services in the United States, Canada, and Puerto Rico. Established in 1985, and now led by CEO Steven Cooper, the company provides employment to 6,000 people and with the stock’s market cap sitting at USD $1.05B, it comes under the small-cap group.
TBI’s shares are currently trading at -62% less than its actual level of $75.66, at a price tag of $28.65, based on its expected future cash flows. The mismatch signals a potential chance to invest in TBI at a discounted price. Also, TBI’s PE ratio is currently around 20.8x relative to its professional services peer level of 25x, indicating that relative to its comparable set of companies, we can invest in TBI at a lower price. TBI 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 25% has over the past couple of years signifying TBI’s capability
JinkoSolar Holding Co., Ltd. (NYSE:JKS)
JinkoSolar Holding Co., Ltd., together with its subsidiaries, engages in the design, development, production, and marketing of photovoltaic products in the People’s Republic of China and internationally. Formed in 2006, and run by CEO Kangping Chen, the company provides employment to 15,000 people and with the market cap of USD $790.05M, it falls under the small-cap category.
JKS’s stock is now trading at -58% less than its value of ¥59.22, at a price tag of ¥24.6, based on my discounted cash flow model. This discrepancy gives us a chance to invest in JKS at a discount. Additionally, JKS’s PE ratio is trading at 11.1x compared to its semiconductors and semiconductor equipment peer level of 25.2x, suggesting that relative to its comparable set of companies, we can purchase JKS’s shares for cheaper. JKS is also a financially robust company, with near-term assets able to cover upcoming and long-term liabilities. The stock’s debt-to equity ratio of 174% has been falling for the last couple of years indicating its ability to pay down its debt.