Asian Market Insights: 3 Stocks That Investors Might Be Undervaluing

As global markets respond to easing trade tensions and positive economic signals, Asian indices have shown resilience, with notable gains in China and Japan. In this environment, identifying undervalued stocks becomes crucial for investors seeking opportunities amidst the broader market optimism.

Top 10 Undervalued Stocks Based On Cash Flows In Asia

Name	Current Price	Fair Value (Est)	Discount (Est)
T'Way Air (KOSE:A091810)	₩2025.00	₩4024.62	49.7%
Suzhou Zelgen BiopharmaceuticalsLtd (SHSE:688266)	CN¥111.64	CN¥222.46	49.8%
SIGMAXYZ Holdings (TSE:6088)	¥1221.00	¥2440.83	50%
Shanghai OPM Biosciences (SHSE:688293)	CN¥43.21	CN¥85.97	49.7%
Prospect Logistics and Industrial Freehold and Leasehold Real Estate Investment Trust (SET:PROSPECT)	THB7.20	THB14.35	49.8%
Maxscend Microelectronics (SZSE:300782)	CN¥69.87	CN¥139.59	49.9%
KeePer Technical Laboratory (TSE:6036)	¥3375.00	¥6748.76	50%
Good Will Instrument (TWSE:2423)	NT$43.40	NT$86.69	49.9%
Forum Engineering (TSE:7088)	¥1195.00	¥2373.59	49.7%
Duk San NeoluxLtd (KOSDAQ:A213420)	₩33600.00	₩66906.69	49.8%

Click here to see the full list of 268 stocks from our Undervalued Asian Stocks Based On Cash Flows screener.

Let's review some notable picks from our screened stocks.

Genscript Biotech (SEHK:1548)

Overview: Genscript Biotech Corporation is an investment holding company involved in the manufacture and sale of life science research products and services across the United States, Europe, Mainland China, Asia Pacific, and internationally, with a market cap of HK$33.16 billion.

Operations: The company's revenue is primarily derived from Life Science Services and Products ($454.95 million), Biologics Development Services ($95.02 million), and Industrial Synthetic Biology Products ($53.69 million).

Estimated Discount To Fair Value: 31.1%

Genscript Biotech is trading at HK$15.22, significantly below its estimated fair value of HK$22.09, suggesting it may be undervalued based on cash flows. Recent payments totaling US$213.8 million from ProBio bolster its cash reserves, enhancing financial stability and core competencies. While earnings are forecast to grow substantially at 65.8% per year and revenue growth outpaces the Hong Kong market, a low return on equity of 7.1% in three years presents a potential concern for investors seeking high returns.

• Our expertly prepared growth report on Genscript Biotech implies its future financial outlook may be stronger than recent results.
• Dive into the specifics of Genscript Biotech here with our thorough financial health report.

Suzhou Nanomicro Technology (SHSE:688690)

Overview: Suzhou Nanomicro Technology Co., Ltd. manufactures and supplies spherical, mono-disperse particles for various industries worldwide, with a market cap of CN¥9.13 billion.

Operations: The company's revenue segments include the production and distribution of spherical, mono-disperse particles for diverse industrial applications globally.

Estimated Discount To Fair Value: 15.5%

Suzhou Nanomicro Technology is trading at CN¥22.77, below its estimated fair value of CN¥26.96, indicating potential undervaluation based on cash flows. Earnings are expected to grow significantly at 37.9% per year, outpacing the broader Chinese market's growth rate. Recent financial results show revenue increased to CN¥188.59 million from CN¥154.1 million a year ago, with net income rising to CN¥29.22 million from CN¥16.89 million, supporting its growth trajectory despite a forecasted low return on equity of 11%.

• The analysis detailed in our Suzhou Nanomicro Technology growth report hints at robust future financial performance.
• Click here and access our complete balance sheet health report to understand the dynamics of Suzhou Nanomicro Technology.

SBS Holdings (TSE:2384)

Overview: SBS Holdings, Inc. offers logistics services both in Japan and internationally, with a market cap of ¥126.90 billion.

Operations: The company generates revenue from its Logistics Business, which accounts for ¥429.82 billion, and its Real Estate Business, contributing ¥10.09 billion.

Estimated Discount To Fair Value: 35.5%

SBS Holdings, trading at ¥3195, is significantly undervalued with a fair value estimate of ¥4956.46 according to discounted cash flow analysis. Despite profit margins declining from 1.9% to 1.3%, earnings are projected to grow at 22.44% annually, surpassing the Japanese market growth rate of 7.5%. However, the dividend yield of 2.66% isn't well covered by free cash flows and debt coverage by operating cash flow remains weak amidst planned strategic acquisitions like Bridgestone Logistics Co., Ltd.'s stock.

• In light of our recent growth report, it seems possible that SBS Holdings' financial performance will exceed current levels.
• Click here to discover the nuances of SBS Holdings with our detailed financial health report.

Taking Advantage

• Unlock our comprehensive list of 268 Undervalued Asian Stocks Based On Cash Flows by clicking here.
• Already own these companies? Bring clarity to your investment decisions by linking up your portfolio with Simply Wall St, where you can monitor all the vital signs of your stocks effortlessly.
• Invest smarter with the free Simply Wall St app providing detailed insights into every stock market around the globe.

Want To Explore Some Alternatives?

• Explore high-performing small cap companies that haven't yet garnered significant analyst attention.
• Diversify your portfolio with solid dividend payers offering reliable income streams to weather potential market turbulence.
• Fuel your portfolio with companies showing strong growth potential, backed by optimistic outlooks both from analysts and management.

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.

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