Discover 3 TSX Stocks Estimated Below Intrinsic Value In August 2024
In This Article:
As the Canadian market navigates a period of economic recalibration, marked by easing inflation and shifting central bank policies, investors are keenly observing the implications for their portfolios. In this context, identifying undervalued stocks on the TSX could offer strategic opportunities for those looking to capitalize on intrinsic value amidst evolving market conditions.
Top 10 Undervalued Stocks Based On Cash Flows In Canada
| Name | Current Price | Fair Value (Est) | Discount (Est) |
| goeasy (TSX:GSY) | CA$192.50 | CA$351.84 | 45.3% |
| Amerigo Resources (TSX:ARG) | CA$1.615 | CA$3.06 | 47.3% |
| Viemed Healthcare (TSX:VMD) | CA$10.45 | CA$20.08 | 48% |
| Constellation Software (TSX:CSU) | CA$4038.81 | CA$7137.44 | 43.4% |
| Bragg Gaming Group (TSX:BRAG) | CA$7.21 | CA$11.54 | 37.5% |
| Boyd Group Services (TSX:BYD) | CA$218.98 | CA$403.42 | 45.7% |
| Green Thumb Industries (CNSX:GTII) | CA$15.46 | CA$30.83 | 49.9% |
| NanoXplore (TSX:GRA) | CA$2.23 | CA$4.23 | 47.3% |
| TerrAscend (TSX:TSND) | CA$1.74 | CA$3.23 | 46.1% |
| Opsens (TSX:OPS) | CA$2.90 | CA$4.64 | 37.5% |
Let's explore several standout options from the results in the screener.
Advantage Energy
Overview: Advantage Energy Ltd. operates in Alberta, Canada, focusing on the acquisition, development, and production of natural gas, crude oil, and NGLs with a market cap of CA$1.52 billion.
Operations: The company generated CA$501.15 million from its Advantage Oil & Gas Ltd. segment.
Estimated Discount To Fair Value: 11.1%
Advantage Energy Ltd. appears undervalued based on cash flows, trading at CA$9 below its estimated fair value of CA$10.12. Despite a recent net loss of CA$12.08 million in Q2 2024, the company’s revenue increased to CA$100.66 million from CA$93.38 million year-over-year. Earnings are forecast to grow significantly at 29.7% annually, outpacing the Canadian market's growth rate of 14.8%, although profit margins have declined from last year’s 29% to 16%.
Cargojet
Overview: Cargojet Inc. offers time-sensitive overnight air cargo services and carriers across Canada, with a market cap of CA$1.98 billion.
Operations: Cargojet generates revenue primarily from its Transportation - Air Freight segment, which amounts to CA$876.80 million.
Estimated Discount To Fair Value: 12.9%
Cargojet, trading at CA$116.33, is undervalued based on discounted cash flow analysis with a fair value estimate of CA$133.59. Earnings are forecast to grow significantly at 26.51% annually, outpacing the Canadian market's 14.8%. However, profit margins have dropped from 28.4% to 4.5%, and insider selling has been significant recently. A new three-year agreement with Great Vision HK Express is expected to generate over CA$160 million in revenue, enhancing its financial outlook amidst slower revenue growth projections of 7.5% per year compared to the market's 6.8%.