Ashtead Technology Holdings And Two More UK Stocks That Could Be Trading Below Their Estimated True Value
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The United Kingdom stock market has shown resilience, rising 7.4% over the past year with earnings expected to grow by 13% annually. In such a promising environment, identifying stocks that may be trading below their true value could offer attractive opportunities for investors looking for potential growth.
Top 10 Undervalued Stocks Based On Cash Flows In The United Kingdom
| Name | Current Price | Fair Value (Est) | Discount (Est) |
| TBC Bank Group (LSE:TBCG) | ￡25.40 | ￡48.57 | 47.7% |
| Morgan Advanced Materials (LSE:MGAM) | ￡3.145 | ￡6.11 | 48.5% |
| Mercia Asset Management (AIM:MERC) | ￡0.30 | ￡0.58 | 48.5% |
| WPP (LSE:WPP) | ￡7.394 | ￡13.84 | 46.6% |
| LSL Property Services (LSE:LSL) | ￡3.23 | ￡6.03 | 46.4% |
| Loungers (AIM:LGRS) | ￡2.66 | ￡5.23 | 49.1% |
| Deliveroo (LSE:ROO) | ￡1.29 | ￡2.47 | 47.7% |
| Ricardo (LSE:RCDO) | ￡4.88 | ￡9.02 | 45.9% |
| Elementis (LSE:ELM) | ￡1.492 | ￡2.82 | 47.1% |
| Aston Martin Lagonda Global Holdings (LSE:AML) | ￡1.507 | ￡2.95 | 48.8% |
Let's explore several standout options from the results in the screener
Ashtead Technology Holdings
Overview: Ashtead Technology Holdings Plc specializes in renting subsea equipment for the offshore energy industry across Europe, the Americas, Asia-Pacific, and the Middle East, with a market capitalization of approximately ￡595.69 million.
Operations: The company generates ￡110.47 million in revenue from its oil well equipment and services segment.
Estimated Discount To Fair Value: 25%
Ashtead Technology Holdings, valued at ￡7.43, trades below its estimated fair value of ￡9.90, reflecting a 25% undervaluation. Despite a high level of debt, the company's earnings have grown by 74.4% over the past year with forecasts suggesting further growth at 15.39% annually, outpacing the UK market's expected 12.5%. Additionally, significant insider selling has occurred in the last three months which could indicate caution among those closest to company operations.
Barratt Developments
Overview: Barratt Developments plc is a UK-based housebuilder with a market capitalization of approximately ￡4.57 billion.
Operations: The primary revenue stream, generating ￡4.39 billion, comes from its residential construction activities in the UK.
Estimated Discount To Fair Value: 21.9%
Barratt Developments, priced at ￡4.72, is undervalued by over 20%, with its fair value estimated at ￡6.04. Despite a drop in profit margins from 9.4% to 5% over the past year and dividends not well covered by earnings or cash flows, the company's earnings are expected to grow significantly, surpassing UK market averages with an annual forecast of 20.1%. Additionally, revenue is projected to increase at a rate of 6.2% annually, outperforming the UK market growth expectation of 3.5%.