undervalued


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Undervalued

A stock price perceived to be too low or cheap, as indicated by a particular valuation model. For instance, some might consider a particular company's stock price cheap if the company's price-earnings ratio is much lower than the industry average. To refer to undervaluation or overvaluation implicitly assumes some model of valuation. It is always possible that the security is valued correctly and that model applied is wrong.

Undervaluation

The state in which a security's price is lower than it ought to be. A stock may be undervalued, for example, when its earnings and financial outlook are both strong, but its share price is still comparatively low. A number of factors may cause undervaluation, including lack of investor knowledge about the company, which, in turn, leads to low demand for its securities. Value investors seek out undervalued companies because they tend to provide solid returns for lower prices.

undervalued

Of, relating to, or being a security that trades at a price lower than it logically should trade. Determining whether a security is undervalued is a subjective judgment. Compare overvalued.
References in periodicals archive ?
During these early years, the renminbi was not undervalued, and its peg certainly did not give the Chinese an unfair trade advantage.
"The largest percentage of managers for any region (63 percent) views emerging market equities as undervalued," the report states.
Occidental has the most attractive production growth and reserve replacement metrics in Big Oil Halliburton, an oil services firm exposed to Gulf of Mexico drilling, is also undervalued at 26-28.
The bill also establishes a four-part test to determine if a currency is substantially undervalued, including determinations of whether there are large-scale government interventions in the markets, undervaluation of at least 5 percent, a significant and persistent global current account surplus, and excessive foreign asset reserves.
I can sympathise with the writer as she feels undervalued, something which is endemic in the nursing profession, nationally and internationally.
In Chapter 7, Wright moves easily through various methods to determine undervalued and overvalued stocks.
According to the data the average price of Sofia property is 1,759EUR per square meter, compared to Monaco at 35,658EUR per sqm, and London, Paris and Moscow at between 10,000 and 14,000 EUR per sqm, but even comparing it to Vilnius in Lithuania at 2,406EUR per sqm, and Bucharest, Romania at 3,404EUR per sqm you can see that Bulgaria property is undervalued.
Several directors agreed that the exchange rate is undervalued, without naming names.
Stocks on the Dubai Financial Market and the Abu Dhabi Stock Exchange are seen as undervalued, reports Emirates Business.
International Resource News-15 October 2009-CCG plans to acquire undervalued and underdeveloped projects(C)2009 ENPublishing - http://www.enpublishing.co.uk
The report said there was ample evidence that the yuan was "substantially undervalued".
MARTIN O'NEILL insists Liverpool have undervalued Aston Villa skipper Gareth Barry at pounds 10m as he reiterated his determination to try to keep the England midfielder.