The South Korean stock market has recently been on a downturn, with the KOSPI index falling for consecutive sessions amid global economic uncertainties and mixed forecasts. This trend highlights potential opportunities for investors to consider undervalued stocks that may be poised for recovery or growth as market conditions evolve. In this context, it becomes crucial to understand what constitutes a good investment in undervalued stocks, especially when broader market movements suggest a cautious approach. Investors can look for companies with strong fundamentals, including robust earnings potential and solid balance sheets, which may be well-positioned to capitalize when market sentiment improves.

Top 10 Undervalued Stocks by Cash Flow in South Korea

Name	Current price	Fair value (estimate)	Discount (estimated)
Pharmaceutical research (KOSDAQ:A214450)	₩133000.00	₩243203.42	45.3%
Cosmax (KOSE:A192820)	₩148700.00	₩284431.69	47.7%
NEXT (KOSDAQ:A348210)	₩57000.00	₩110042.78	48.2%
HANMI Semiconductor (KOSE:A042700)	₩137500.00	₩259547.75	47%
Caregen (KOSDAQ:A214370)	₩24100.00	₩44549.16	45.9%
KidariStudio (KOSE:A020120)	₩3765.00	₩7191.03	47.6%
ISU Petasys (KOSE:A007660)	₩43950.00	₩83315.25	47.2%
Medy-Tox (KOSDAQ:A086900)	₩177400.00	₩320066.86	44.6%
Genomictree (KOSDAQ:A228760)	₩20900.00	₩38929.19	46.3%
Beam (KOSDAQ:A228670)	₩11020.00	₩21214.01	48.1%

Click here to see the full list of 42 stocks from our undervalued KRX stocks based on cash flow screener.

Discover some gems from our specialized screener.

Overview: Intellian Technologies, Inc., based in South Korea, specializes in the production of satellite antennas and terminals for the global market, with a market capitalization of approximately ₩577.60 billion.

Activities: The company generates ₩287.35 million from the sale of telecommunications equipment.

Estimated discount to fair value: 43.3%

Intellian Technologies, currently trading at ₩55,200, is significantly undervalued by 43.3%, with a fair value estimate of ₩97,337.47. The company’s revenue growth is robust at 29.3% per year, which is higher than the South Korean market average of 10.3%. Despite this strong growth potential and the recent completion of a KRW 2.77 billion share buyback, analysts are only forecasting modest share price gains and note a low expected return on equity of 13.7% over three years.

Overview: Hd Hyundai Mipo Co., Ltd. is a South Korean company specialized in ship manufacturing, repairing and conversion, with a market capitalization of approximately ₩4.51 billion.

Activities: The company’s main revenue, ₩4.97 billion, is generated from shipbuilding activities.

Estimated discount to fair value: 14.6%

Hd Hyundai Mipo Co., Ltd., currently priced at ₩113,200, is slightly undervalued with our fair value estimate at ₩132,613.16. The company’s revenue growth forecast of 10.7% per year slightly beats the 10.3% forecast for the South Korean market. Despite this, Hd Hyundai Mipo is expected to become profitable within the next three years, although its expected return on equity remains low at 11.2%. This mixed financial outlook reflects both potential and caution in the current valuation.

Overview: Amorepacific Corporation is a global cosmetics and beauty products company engaged in research, development, manufacturing and marketing, with a market capitalization of approximately ₩10.49 billion.

Activities: The company’s revenue is divided into two main segments: the Cosmetics division, accounting for ₩3.27 billion, and the DB (Daily Beauty) division, accounting for ₩0.40 billion.

Estimated discount to fair value: 11.8%

Amorepacific, priced at ₩170,900, is trading below our fair value estimate of ₩193,826.30. Earnings are expected to grow 38.81% annually and revenue 13.8% annually, both rates outperforming South Korean market averages, and showing robust growth potential. However, forecast return on equity is low at 8.6%, suggesting some efficiency challenges ahead, despite strong earnings and revenue growth forecasts and a recent leadership change aimed at expanding North American operations.

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This article from Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts, using only an unbiased methodology. Our articles are not intended as financial advice. They do not constitute a recommendation to buy or sell stocks and do not take into account your objectives or financial situation. We aim to provide you with long-term focused analysis driven by fundamental data. Please note that our analysis may not take into account the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in the stocks mentioned.

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