Top 10 Undervalued Companies in the US Stock Exchanges

19 Apr 2017 • by Natalie Aster
Top 10 Undervalued Companies in the US Stock Exchanges

LONDON – Today, many investors, who don’t seek short-term gains, tend to use ‘value investing’ strategy, thus, looking for stocks traded for less than their intrinsic values, so called undervalued stocks. Value investors actively seek such stocks, as they believe that the market overreacts to good and bad news, resulting in stock price movements that don’t correspond with a company’s long-term fundamentals, giving an opportunity to profit when the price is deflated.

Undervalued stocks can be found in any industry. More often they are offered by companies with cyclical character of performance. During some periods the yield of such companies could fall sharply, thus, the value of its stocks also declines. By the time, the performance of a company improves, and its assets also increase in value. The aim of the investor is to buy stocks at the moment of “falling price”.

The key challenge associated with buying of undervalued stocks lays in estimation of intrinsic value of a stock. Several investors can be provided with the same info and place a different value on one company. Therefore, one of the major concepts of value investing is “margin of value”: investors need to buy an equity at a big enough discount in order to allow some room for error in the value estimation. Moreover, value investing is subjective; some value investors only look at the current assets and earnings, whilst other base their strategies around future growth prospects.

The Market Publishers, Ltd. has prepared a unique rating of companies with undervalued stocks, using the key financial parameters such as P/E ratio (it must be less than 15 for a company to be undervalued), price to book (it must be less than 1), price to sales (a rational estimate must be nearly 1, if it is over 2 – the stock is overestimated), return on equity (TTM) (stocks are rather risky thing, therefore return on equity must not be less then low-risk instruments like bank deposits and bonds).

Purchasing of undervalued stocks gives a possibility to derive benefits in future, when their value will reach the lucrative level. However still there is no guarantee as to when or whether a stock that appears undervalued will appreciate. There is no any single way to determine a stock’s intrinsic value, therefore, it is usually a “guessing game”.

Top Undervalued Companies in the US Stock Exchanges:

1.    Bonso Electronics International, Inc. 

Bonso Electronics International is engaged in the manufacturing and selling of a comprehensive line of weighing instruments and electronic scales, healthcare products and telecommunications products. Scales produced by the Company include kitchen, bathroom, jewelry, office, postal, laboratory and industrial scales. The Company also produces cordless phones, two-way radios and global positioning systems.

Ticker Symbol: BNSO
Stock exchange: NASDAQ
Country: Hong Kong
Market capitalization: $ 12.60M
Revenue: $ 23.9M (Mar 31, 2016)
P/E ratio: 4.4
Price to sales: 0.6
Return on equity (TTM) (%): 21.72%
Last price: $ 2.59

Bonso Electronics International

2.    Natural Alternatives International, Inc. 

Natural Alternatives International (NAI) is one of the top formulators and manufacturers of customized nutritional supplements. The list of the Company’s offerings includes minerals, vitamins, herbs and specialty formulas. NAI also provides private label contract manufacturing services to different companies engaged in the marketing and distribution of various nutritional supplements.

Ticker: NAII
Stock exchange: NASDAQ
Country: the US
Market capitalization: $ 60.48M
Revenue: $114.2M (Jun 30, 2016)
P/E ratio: 5.1
Price to sales: 0.5
Return on equity (TTM) (%): 19.56%
Last price: $ 8.80

 Natural Alternatives International


3.   
GameStop Corp. 

GameStop Corporation operates specialty PC entertainment and electronic game software stores across the US, Canada, Australia and Europe. The Company’s stores offer new as well as used video game hardware, video game software and various accessories, and also PC entertainment software and accessories, and other related products.

Ticker: GME
Stock exchange: NYSE
Country: the US
Market capitalization: $ 1.82B
Revenue: $ 8,607.9M (Jan 28, 2017)
P/E ratio: 6.1
Price to sales: 0.2
Return on equity (TTM) (%): 16.29%
Last price: $ 20.70

GameStop Corporation 

4.    Sportsman's Warehouse Holdings, Inc. 

Sportsman’s Warehouse Holdings is an outdoor sporting goods retailer in the US. The company’s offerings include camping, clothing, fishing, footwear, hunting and shooting products, as well as related optics, accessories and electronics. Moreover, the Company’s stores offer archery technician services, gun bore sighting and scope mounting, fishing-reel line winding, amid others, as well as issues fishing and hunting licenses.

Ticker: SPWH
Stock exchange: NASDAQ
Country: the US
Market capitalization: $ 180.82M
Revenue: $ 780.0M (Jan 28, 2017)
P/E ratio: 6.7
Price to sales: 0.3
Return on equity (TTM) (%): 212.36%
Last price: $ 4.64

Sportsman’s Warehouse Holdings 

5.    Tempur-Pedic International, Inc. 

Tempur-Pedic International is involved in the production and distribution of mattresses, pillows, bed linens, home and travel products, slippers (women’s, men’s and children’s), and other related sleep products.

Ticker: TPX
Stock exchange: NYSE
Country: the US
Market capitalization: $ 2.36B
Revenue: $ 3,127.3M (Dec 31, 2016)
P/E ratio: 12.9
Price to sales: 0.8
Return on equity (TTM) (%): 146.98%
Last price: $ 44.10

 Tempur-Pedic International


6.   
Greenbrier Companies, Inc. 

Greenbrier Companies operates as a designer, manufacturer and marketer of railroad freight car equipment in North America and Europe; a manufacturer and seller of marine barges in North America; a provider of wheel services, parts, leasing and other services to the railroad and related transportation industries in North America; and a provider of railcar repair, refurbishment and retrofitting services in North America through a joint venture partnership. The Company also produces tank heads, rail castings and other railcar components through other joint ventures. 

Ticker: GBX
Stock exchange: NYSE
Country: the US
Market capitalization: $ 1.18B
Revenue: $ 2,679.5M (Aug 31, 2016)
P/E ratio: 9.5
Price to sales: 0.4
Return on equity (TTM) (%): 22.80%
Last price: $ 41.75

Greenbrier Companies 

7.    Yew Bio-Pharm Group, Inc.

Yew Bio-Pharm Group is a recognized as a top grower and seller of yew trees as well as producer of products manufactured from yew trees in China. This Company is engaged into selling of raw materials, including leaves and branches of yew trees, used majorly in the production of traditional Chinese medicines.

Ticker: YEWB
Stock exchange: OTC Markets
Country: the US<
Market capitalization: $ 10.38M
Revenue: $ 51.3M (Dec 31, 2016)
P/E ratio: 2.2
Price to sales: 0.5
Return on equity (TTM) (%): 14.27%
Last price: $ 0.20

Yew Bio-Pharm Group 

8.     Allianz SE

Allianz SE is engaged in the provision of life, health, property-casualty, travel and motor vehicle insurance services as well as asset management products/services. In the year 2014, this Company ranked the global largest insurance company, the largest financial services group and also the largest company according to a composite measure by Forbes magazine. 

Ticker: AZSEY
Stock exchange: OTC Markets
Country: Germany
Market capitalization: $ 83.55B
Revenue: $ 113,041.5M (Dec 31, 2016)
P/E ratio: 11.6
Price to sales: 0.8
Return on equity (TTM) (%): 10.55%
Last price: $ 18.50

 Allianz SE


9.   
Zurich Insurance Group AG

Zurich Insurance Group offers insurance-based financial services. The Company provides a range of general and life insurance services and products for individuals, commercial enterprises, small businesses, large and mid-sized corporations, and multinational players.

Ticker: ZURVY
Stock exchange: OTC Markets
Country: Switzerland
Market capitalization: $ 39.88B
Revenue: $ 67,334.0M (Dec 31, 2016)
P/E ratio: 12.3

Price to sales: 0.6
Return on equity (TTM) (%): 10.39%
Last price: $ 26.42

Zurich Insurance Group 

10.  Panasonic Corporation

Panasonic Corporation is one of the biggest Japanese multinational manufacturers of different electronic and electric products. The list of Company’s offerings includes computer peripherals, home appliances, industrial equipment, electronic parts, audio and video equipment, etc. Panasonic Corporation has associated companies worldwide.

Ticker: PCRFY
Stock exchange: OTC Markets
Country: Japan
Market capitalization: $ 28.29B
Revenue: $ 67,891.3M (Mar 31, 2017
P/E ratio: 14.2
Price to sales: 0.4
Return on equity (TTM) (%): 10.95%
Last price: $ 11.52 

Panasonic Corporation 

Note that the 10 undervalued companies mentioned in this article are priced at levels that strongly suggest substantial future appreciation, however, don’t buy anything without doing your own research and determining whether it’s suitable for your financial situation!