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The Australian market has been experiencing volatility, with sectors like utilities showing resilience while consumer discretionary faces challenges. In such a fluctuating environment, identifying stocks that may be trading below their estimated value can offer potential opportunities for investors seeking to capitalize on market inefficiencies.
Top 10 Undervalued Stocks Based On Cash Flows In Australia
Name | Current Price | Fair Value (Est) | Discount (Est) |
Mader Group (ASX:MAD) | A$6.00 | A$11.09 | 45.9% |
Domino's Pizza Enterprises (ASX:DMP) | A$28.89 | A$53.03 | 45.5% |
Viva Energy Group (ASX:VEA) | A$1.755 | A$3.11 | 43.7% |
Atlas Arteria (ASX:ALX) | A$5.10 | A$9.35 | 45.5% |
Aussie Broadband (ASX:ABB) | A$3.74 | A$7.18 | 47.9% |
Audinate Group (ASX:AD8) | A$8.77 | A$16.46 | 46.7% |
Charter Hall Group (ASX:CHC) | A$17.45 | A$31.85 | 45.2% |
ReadyTech Holdings (ASX:RDY) | A$3.30 | A$5.79 | 43% |
Pantoro (ASX:PNR) | A$0.14 | A$0.26 | 45.4% |
Adriatic Metals (ASX:ADT) | A$4.38 | A$8.02 | 45.4% |
Let's take a closer look at a couple of our picks from the screened companies.
Charter Hall Group
Overview: Charter Hall Group is a leading Australian fully integrated property investment and funds management company with a market cap of A$8.25 billion.
Operations: The company's revenue is primarily derived from Funds Management (A$441.60 million), Property Investments (A$332.50 million), and Development Investments (A$45.30 million).
Estimated Discount To Fair Value: 45.2%
Charter Hall Group is trading at A$17.45, significantly below its estimated fair value of A$31.85, suggesting it may be undervalued based on cash flows. The company forecasts a robust profit growth of 30.23% annually and expects to become profitable within three years, outpacing the market average. Despite a slower revenue growth rate of 13.4%, recent earnings guidance has been upgraded, reflecting confidence in future performance amidst ongoing corporate activities and dividend increases.
National Storage REIT
Overview: National Storage REIT is the largest self-storage provider in Australia and New Zealand, operating over 225 centers that offer tailored storage solutions to more than 90,000 residential and commercial customers, with a market cap of A$3.08 billion.
Operations: The company's revenue primarily comes from the operation and management of storage centers, generating A$354.69 million.