In This Article:
In the last week, the Australian market has remained flat, yet it has experienced a 15% increase over the past year with earnings forecasted to grow by 12% annually. In this context of steady growth, identifying stocks that may be trading below their estimated value can provide opportunities for investors seeking potential gains in a thriving market.
Top 10 Undervalued Stocks Based On Cash Flows In Australia
Name | Current Price | Fair Value (Est) | Discount (Est) |
Mader Group (ASX:MAD) | A$5.35 | A$10.41 | 48.6% |
EZZ Life Science Holdings (ASX:EZZ) | A$4.46 | A$8.79 | 49.2% |
MLG Oz (ASX:MLG) | A$0.635 | A$1.16 | 45.2% |
Charter Hall Group (ASX:CHC) | A$15.84 | A$31.47 | 49.7% |
Ingenia Communities Group (ASX:INA) | A$4.97 | A$9.43 | 47.3% |
Little Green Pharma (ASX:LGP) | A$0.085 | A$0.17 | 49.8% |
Millennium Services Group (ASX:MIL) | A$1.145 | A$2.24 | 48.9% |
IDP Education (ASX:IEL) | A$15.01 | A$27.65 | 45.7% |
Superloop (ASX:SLC) | A$1.765 | A$3.31 | 46.7% |
Mineral Resources (ASX:MIN) | A$51.18 | A$95.96 | 46.7% |
Let's dive into some prime choices out of the screener.
Aussie Broadband
Overview: Aussie Broadband Limited offers telecommunications and technology services in Australia with a market cap of A$1.13 billion.
Operations: The company's revenue is derived from several segments, including Business (A$96.97 million), Wholesale (A$159.73 million), Residential (A$585.07 million), Symbio Group (A$69.93 million), and Enterprise and Government (A$88.04 million).
Estimated Discount To Fair Value: 42.4%
Aussie Broadband appears undervalued based on cash flows, trading at A$3.88, which is over 20% below its estimated fair value of A$6.74. The company reported substantial revenue growth to nearly A$1 billion and net income of A$26.38 million for the fiscal year ending June 2024, despite shareholder dilution and one-off items affecting earnings quality. With forecasted annual profit growth of 27.3%, it surpasses the Australian market's expected growth rate significantly, indicating potential for future expansion.
SiteMinder
Overview: SiteMinder Limited develops, markets, and sells an online guest acquisition platform and commerce solutions for accommodation providers in Australia and internationally, with a market cap of A$1.77 billion.
Operations: The company's revenue segment consists of Software & Programming, generating A$190.84 million.