Ying Li International Real Estate and Olam International are stocks on my list that are potentially undervalued. This means their current share prices are trading well-below what the companies are actually worth. Smart investors can make money from this discrepancy by buying these shares, because they believe the current market prices will eventually move towards their true value. If you’re looking for capital gains in your next investment, I suggest you take a look at my list of potentially undervalued stocks.
Ying Li International Real Estate Limited (SGX:5DM)
Ying Li International Real Estate Limited, an investment holding company, engages in the development, sale, rental, management, and ownership of commercial and residential properties under the Ying Li brand in the People’s Republic of China. Ying Li International Real Estate was formed in 1993 and with the company’s market cap sitting at SGD SGD355.43M, it falls under the small-cap group.
5DM’s stock is now hovering at around -85% under its true level of ¥0.91, at a price tag of S$0.14, based on its expected future cash flows. This price and value mismatch indicates a potential opportunity to buy the stock at a low price. In addition to this, 5DM’s PE ratio stands at 4.85x against its its Real Estate peer level of, 10.08x suggesting that relative to its peers, 5DM’s shares can be purchased for a lower price. 5DM is also a financially robust company, with current assets covering liabilities in the near term and over the long run. Finally, its debt relative to equity is 73.92%, which has been falling over the past couple of years demonstrating its capacity to reduce its debt obligations year on year. Interested in Ying Li International Real Estate? Find out more here.
Olam International Limited (SGX:O32)
Olam International Limited engages in sourcing, processing, packaging, and merchandising of agricultural products worldwide. Started in 1989, and now run by Sunny Verghese, the company currently employs 35,000 people and has a market cap of SGD SGD7.48B, putting it in the mid-cap category.
O32’s shares are currently floating at around -62% less than its actual level of $6.17, at the market price of S$2.35, based on my discounted cash flow model. signalling an opportunity to buy the stock at a low price. In addition to this, O32’s PE ratio stands at 12.62x while its Consumer Retailing peer level trades at, 19.27x indicating that relative to its peers, you can buy O32 for a cheaper price. O32 is also a financially healthy company, with near-term assets able to cover upcoming and long-term liabilities. Finally, its debt relative to equity is 175.02%, which has been reducing over time, revealing its capability to reduce its debt obligations year on year. More on Olam International here.