Undervalued security

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Undervalued security

A security selling below its market value or liquidation value.

Undervalued Security

A security with a share price lower than its asset value and/or earnings potential. It can be difficult to determine whether or not a security is undervalued, but a low price-earnings ratio is one way to estimate it. A price-earnings ratio below 1 indicates that the security's price is less than the company's earnings per share, which may mean that the company is undervalued. Undervalued companies are often target companies in hostile takeovers. See also: Undervalued, Overvalued.
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Furthermore, portfolio management believes that this action may allow them the opportunity to retain capital in order to take advantage of severely under-valued securities and attractive market opportunities as they seek to enhance the Fund's total return profile over the long-term.
Nuveen's Tradewinds affiliate was recognized in three categories for funds which employ an investment strategy known for rigorous bottom-up research aimed at selecting under-valued securities of business franchises possessing strong or improving fundamentals.
Furthermore, this action may allow portfolio management the opportunity to retain capital in order to take advantage of severely under-valued securities and attractive market opportunities as they seek to enhance the Fund's total return profile over the long-term.
Both funds' investment process employs Tradewinds' rigorous bottom-up research aimed at selecting under-valued securities that are believed to be mispriced, misperceived or underfollowed and that have the prospects of strong or improving business fundamentals.
Furthermore, management believes this move will provide the portfolio managers with more flexibility to take advantage of severely under-valued securities and attractive market opportunities that may enhance the Fund's total return profile over the long-term.
Due to structural anomalies in the way spin-offs are priced, marketed, traded and followed, they provide a consistent universe of under-valued securities that have exceeded the S&P 500 in five out of the last six years," Stahl explained.