Top Cheap Stocks To Buy3 Nov 2017 16:06
Rowena Monahan November 3, 2017
Companies with shares trading at a market price below what they are actually worth, such as Playtech and Revolution Bars Group, are deemed undervalued. Investors can determine how much a company is worth based on how much money they are expected to make in the future, or compared to the value of their peers. The list I�ve put together below are of stocks that compare favourably on all criteria, which potentially makes them good investments if you believe the price should eventually reflect the stock�s actual value.
Playtech plc (LSE:PTEC)
Playtech plc engages in the development and licensing of software products for the online and land-based gambling industries. Established in 1999, and currently run by Mor Weizer, the company employs 5,000 people and with the company�s market cap sitting at GBP �3.10B, it falls under the mid-cap stocks category.
PTEC�s stock is currently floating at around -50% below its true value of �15.42, at a price tag of �7.68, based on my discounted cash flow model. This mismatch signals an opportunity to buy PTEC shares at a discount. Also, PTEC�s PE ratio is around 11.5x while its software peer level trades at 26.3x, implying that relative to its comparable set of companies, PTEC�s stock can be bought at a cheaper price. PTEC is also in good financial health, as near-term assets sufficiently cover liabilities in the near future as well as in the long run. It�s debt-to-equity ratio of 43% has for the past few years signalling PTEC�s capacity
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