Yahoo Finance Best Cheap Stock in June
Boustead Projects and Cityneon Holdings may be trading at prices below their likely values. This suggests that these stocks are undervalued, meaning we can benefit when the stock price moves to its true valuation. 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.
Boustead Projects Limited (SGX:AVM)
Boustead Projects Limited, together with its subsidiaries, provides industrial real estate solutions for multinational corporations and local enterprises in Singapore, Malaysia, China, and Vietnam. Founded in 1996, and run by CEO Kok Hong Chu, the company currently employs 125 people and has a market cap of SGD SGD253.64M, putting it in the small-cap stocks category.
AVM’s stock is now hovering at around -40% below its actual level of $1.35, at a price of S$0.81, based on my discounted cash flow model. This difference in price and value gives us a chance to buy low. In terms of relative valuation, AVM’s PE ratio stands at around 8.81x relative to its Construction peer level of, 12.36x suggesting that relative to its peers, AVM’s stock can be bought at a cheaper price. AVM is also strong financially, with current assets covering liabilities in the near term and over the long run.
Dig deeper into Boustead Projects here.
Cityneon Holdings Limited (SGX:5HJ)
Cityneon Holdings Limited provides interior architecture, experiential environment, event, and exhibition services to multinational corporations, governments, and private sector organizations worldwide. Cityneon Holdings was founded in 1956 and with the market cap of SGD SGD232.42M, it falls under the small-cap category.
5HJ’s shares are now trading at -59% under its actual level of $2.34, at a price tag of S$0.95, according to my discounted cash flow model. This mismatch indicates a potential opportunity to buy low. In addition to this, 5HJ’s PE ratio stands at around 12.13x compared to its index peer level of, 13.02x meaning that relative to other stocks in the industry, you can buy 5HJ for a cheaper price. 5HJ is also in great financial shape, as short-term assets amply cover upcoming and long-term liabilities.
More on Cityneon Holdings here.
Geo Energy Resources Limited (SGX:RE4)
Geo Energy Resources Limited, an investment holding company, engages in mining, producing, and trading coal in Indonesia. Established in 2008, and now run by Kum Hon Tung, the company size now stands at 524 people and with the company’s market cap sitting at SGD SGD299.09M, it falls under the small-cap stocks category.
RE4’s shares are now hovering at around -89% less than its actual value of $2.01, at a price of S$0.22, according to my discounted cash flow model. The difference between value and price signals a potential opportunity to buy RE4 shares at a discount. Furthermore, RE4’s PE ratio is trading at 6.8x compared to its Oil and Gas peer level of, 10.64x suggesting that relative to other stocks in the industry, you can purchase RE4’s stock for a lower price right now. RE4 is also a financially healthy company, with near-term assets able to cover upcoming and long-term liabilities.
More detail on Geo Energy Resources here.
For more financially sound, undervalued companies to add to your portfolio, explore this interactive list of undervalued stocks.
To help readers see pass the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price sensitive company announcements.
The author is an independent contributor and at the time of publication had no position in the stocks mentioned.
