3 US Stocks That Might Be Undervalued According To Estimates
As the U.S. stock market experiences a mixed performance with the Dow Jones Industrial Average reaching record highs while the S&P 500 and Nasdaq Composite face slight declines, investors are closely monitoring inflation data and Federal Reserve rate cuts. In this environment, identifying undervalued stocks becomes crucial for those looking to capitalize on potential market inefficiencies. Given these conditions, it is important to consider stocks that may be trading below their intrinsic value due to temporary market factors or broader economic trends. Here are three U.S. stocks that might be undervalued according to estimates.
Top 10 Undervalued Stocks Based On Cash Flows In The United States
Name | Current Price | Fair Value (Est) | Discount (Est) |
Western Alliance Bancorporation (NYSE:WAL) | $85.58 | $167.74 | 49% |
M-tron Industries (NYSEAM:MPTI) | $41.02 | $79.57 | 48.4% |
KBR (NYSE:KBR) | $64.18 | $126.97 | 49.5% |
TAL Education Group (NYSE:TAL) | $10.80 | $21.08 | 48.8% |
Tenable Holdings (NasdaqGS:TENB) | $39.92 | $78.94 | 49.4% |
Enphase Energy (NasdaqGM:ENPH) | $115.00 | $224.88 | 48.9% |
EVERTEC (NYSE:EVTC) | $33.90 | $66.21 | 48.8% |
Cytek Biosciences (NasdaqGS:CTKB) | $5.39 | $10.61 | 49.2% |
Vasta Platform (NasdaqGS:VSTA) | $2.60 | $5.10 | 49.1% |
SunOpta (NasdaqGS:STKL) | $6.52 | $12.65 | 48.4% |
Here's a peek at a few of the choices from the screener.
DoorDash
Overview: DoorDash, Inc. operates a commerce platform connecting merchants, consumers, and independent contractors both in the United States and internationally, with a market cap of approximately $58.53 billion.
Operations: Revenue segments include Internet Information Providers, generating $9.61 billion.
Estimated Discount To Fair Value: 36.9%
DoorDash, trading at US$142.23, is significantly undervalued based on its estimated fair value of US$225.55. Despite recent insider selling and a net loss reduction from US$331 million to US$180 million for the first half of 2024, DoorDash's revenue growth outpaces the market and is forecasted to grow annually by 13.3%. The company’s strategic partnerships with brands like Mattress Firm and Save A Lot enhance its logistics network and customer base, supporting future profitability within three years.
GlobalFoundries
Overview: GlobalFoundries Inc., a semiconductor foundry with a market cap of $22.60 billion, provides a range of mainstream wafer fabrication services and technologies worldwide.
Operations: GlobalFoundries generates $6.89 billion from its semiconductor segment, offering a variety of mainstream wafer fabrication services and technologies globally.
Estimated Discount To Fair Value: 38.2%
GlobalFoundries, trading at US$40.95, is significantly undervalued with an estimated fair value of US$66.31. Despite a decline in profit margins from 19.1% to 11.8%, earnings are forecasted to grow annually by 23%, outpacing the US market's growth rate of 15.2%. Recent strategic partnerships with Finwave Semiconductor and Efficient bolster its technological capabilities and market reach, potentially enhancing future cash flows and profitability despite current revenue challenges.
Our growth report here indicates GlobalFoundries may be poised for an improving outlook.
Take a closer look at GlobalFoundries' balance sheet health here in our report.
TAL Education Group
Overview: TAL Education Group offers K-12 after-school tutoring services in the People’s Republic of China and has a market cap of $6.54 billion.
Operations: The company generates $1.63 billion from its K-12 after-school tutoring services in the People’s Republic of China.
Estimated Discount To Fair Value: 48.8%
TAL Education Group, currently trading at US$10.8, is significantly undervalued with an estimated fair value of US$21.08. The company reported a net income of US$11.4 million for Q1 2024, marking a turnaround from a net loss the previous year. Earnings are expected to grow annually by 32.9%, outpacing the US market's growth rate of 15.2%. However, its share price has been highly volatile recently and large one-off items have impacted financial results.
Click here to discover the nuances of TAL Education Group with our detailed financial health report.
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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
Companies discussed in this article include NasdaqGS:DASH NasdaqGS:GFS and NYSE:TAL.
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