ASX Value Picks: Flight Centre Travel Group And 2 More Stocks Trading Below Estimated Intrinsic Value
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The ASX200 closed up 0.58% at 8,091.9 points, with the last day of the earnings season revealing mixed results across sectors. Retail sales data from July showed activity plateaued, prompting analysts to consider potential impacts on interest rates. In this context, identifying undervalued stocks becomes crucial for investors seeking opportunities amidst fluctuating market conditions. This article highlights three such stocks trading below their estimated intrinsic value, starting with Flight Centre Travel Group.
Top 10 Undervalued Stocks Based On Cash Flows In Australia
| Name | Current Price | Fair Value (Est) | Discount (Est) |
| Elders (ASX:ELD) | A$9.20 | A$18.11 | 49.2% |
| Hansen Technologies (ASX:HSN) | A$4.30 | A$8.22 | 47.7% |
| Ansell (ASX:ANN) | A$29.83 | A$57.03 | 47.7% |
| VEEM (ASX:VEE) | A$1.705 | A$3.22 | 47% |
| Millennium Services Group (ASX:MIL) | A$1.145 | A$2.24 | 48.9% |
| MedAdvisor (ASX:MDR) | A$0.445 | A$0.86 | 48.1% |
| Little Green Pharma (ASX:LGP) | A$0.092 | A$0.17 | 45.7% |
| Clover (ASX:CLV) | A$0.385 | A$0.72 | 46.5% |
| Aurelia Metals (ASX:AMI) | A$0.155 | A$0.3 | 47.5% |
| Superloop (ASX:SLC) | A$1.755 | A$3.31 | 47.1% |
Let's dive into some prime choices out of the screener.
Flight Centre Travel Group
Overview: Flight Centre Travel Group Limited offers travel retailing services for both leisure and corporate sectors across various regions including Australia, New Zealand, the Americas, Europe, the Middle East, Africa, Asia, and internationally with a market cap of A$4.61 billion.
Operations: Flight Centre Travel Group Limited generates its revenue primarily from the leisure segment (A$1.35 billion) and the corporate segment (A$1.11 billion).
Estimated Discount To Fair Value: 40.3%
Flight Centre Travel Group is trading at A$20.97, significantly below its estimated fair value of A$35.10, indicating it is undervalued based on discounted cash flows. The company's earnings are forecast to grow at 19.5% per year, outpacing the Australian market's 12.3%. Recent full-year results showed net income surged from A$47 million to A$139 million, bolstered by strong sales growth and a robust balance sheet poised for strategic acquisitions and organic expansion in specialist travel sectors.
IDP Education
Overview: IDP Education Limited specializes in placing students into educational institutions across Australia, the United Kingdom, the United States, Canada, New Zealand, and Ireland, with a market cap of A$4.50 billion.