In This Article:
The United Kingdom's stock market has recently experienced a downturn, with the FTSE 100 index closing lower due to weak trade data from China, highlighting concerns about global economic recovery. In such an environment, identifying stocks that might be trading below their estimated value can offer potential opportunities for investors looking to capitalize on undervaluation amid broader market challenges.
Top 10 Undervalued Stocks Based On Cash Flows In The United Kingdom
| Name | Current Price | Fair Value (Est) | Discount (Est) |
| Dr. Martens (LSE:DOCS) | £0.6105 | £1.19 | 48.6% |
| GlobalData (AIM:DATA) | £1.79 | £3.37 | 46.9% |
| Deliveroo (LSE:ROO) | £1.257 | £2.50 | 49.6% |
| AstraZeneca (LSE:AZN) | £120.28 | £219.10 | 45.1% |
| Duke Capital (AIM:DUKE) | £0.3025 | £0.55 | 44.6% |
| Likewise Group (AIM:LIKE) | £0.195 | £0.37 | 47.6% |
| Calnex Solutions (AIM:CLX) | £0.52 | £1.03 | 49.7% |
| Kromek Group (AIM:KMK) | £0.0585 | £0.11 | 48.5% |
| Optima Health (AIM:OPT) | £1.82 | £3.31 | 45% |
| Savannah Energy (AIM:SAVE) | £0.105 | £0.20 | 48.7% |
We'll examine a selection from our screener results.
ConvaTec Group
Overview: ConvaTec Group PLC develops, manufactures, and sells medical products, services, and technologies across Europe, North America, and internationally with a market cap of £5.47 billion.
Operations: The company's revenue is primarily generated from the development, manufacture, and sale of medical products and technologies, amounting to $2.29 billion.
Estimated Discount To Fair Value: 36%
ConvaTec Group appears undervalued, trading at £2.67, 36% below its estimated fair value of £4.18. The company's earnings grew by 46.2% last year and are forecast to grow annually at 16.9%, outpacing the UK market's 14.1%. Despite high debt levels, ConvaTec maintains a strong financial position with operating profit growth projected at 12% for 2025 and a net income increase to US$190.5 million from US$130.3 million in the prior year.
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Our growth report here indicates ConvaTec Group may be poised for an improving outlook.
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Take a closer look at ConvaTec Group's balance sheet health here in our report.
Genus
Overview: Genus plc is an animal genetics company with operations across North America, Latin America, the United Kingdom, the rest of Europe, the Middle East, Russia, Africa and Asia; it has a market cap of £1.25 billion.
Operations: The company's revenue is derived from two main segments: Genus ABS, which contributes £311.10 million, and Genus PIC, which accounts for £358 million.
Estimated Discount To Fair Value: 19%
Genus plc, trading at £19.04, is undervalued relative to its fair value estimate of £23.5. Despite recent earnings showing a decline in net income to £1.5 million from £10.3 million year-on-year, analysts forecast robust profit growth of 46.67% annually over the next three years, outpacing market averages and expected to achieve profitability within this period. However, the stock exhibits high volatility and a low forecasted return on equity of 12.5%.