The United States market has shown a positive trend, climbing by 6.8% over the past week and increasing by 5.9% over the last year, with earnings projected to grow by 14% annually in the coming years. In this environment, identifying stocks that may be trading below their estimated value can offer potential opportunities for investors looking to capitalize on these favorable conditions.

Top 10 Undervalued Stocks Based On Cash Flows In The United States

Click here to see the full list of 180 stocks from our Undervalued US Stocks Based On Cash Flows screener.

Let's take a closer look at a couple of our picks from the screened companies.

Autodesk

Overview: Autodesk, Inc. offers 3D design, engineering, and entertainment technology solutions globally and has a market cap of approximately $55.05 billion.

Operations: The company's revenue comes primarily from its CAD/CAM software segment, which generated $6.13 billion.

Estimated Discount To Fair Value: 23.6%

Autodesk is trading at US$260.71, below its estimated fair value of US$341.21, suggesting it may be undervalued based on cash flows. Earnings are forecast to grow 14.31% annually, outpacing the broader U.S. market's growth expectations of 13.5%. Despite recent board changes and investor activism from Starboard Value LP, Autodesk maintains strong financial performance with significant operating margin and free cash flow improvements, supporting its strategic initiatives for sustained growth and efficiency.

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

Howmet Aerospace

Overview: Howmet Aerospace Inc. offers advanced engineered solutions for the aerospace and transportation sectors across multiple countries, with a market cap of approximately $50.90 billion.

Operations: The company's revenue is primarily derived from its Engine Products segment at $3.74 billion, followed by Fastening Systems at $1.58 billion, Forged Wheels at $1.05 billion, and Engineered Structures at $1.08 billion.

Estimated Discount To Fair Value: 37.1%

Howmet Aerospace, trading at US$127.46, is significantly undervalued with an estimated fair value of US$202.64 based on cash flows. Earnings are projected to grow 15.58% annually, surpassing the U.S. market's growth rate of 13.5%. Despite high debt levels, recent earnings reports show strong performance with a net income increase to US$314 million for Q4 2024 and consistent dividend payouts, indicating robust operational health and shareholder returns.

• Our growth report here indicates Howmet Aerospace may be poised for an improving outlook.
• Unlock comprehensive insights into our analysis of Howmet Aerospace stock in this financial health report.

Spotify Technology

Overview: Spotify Technology S.A., along with its subsidiaries, offers audio streaming subscription services globally and has a market cap of approximately $111.29 billion.

Operations: Spotify generates revenue through its Premium segment, which accounts for €13.82 billion, and its Ad-Supported segment, contributing €1.85 billion.

Estimated Discount To Fair Value: 21.3%

Spotify Technology, currently trading at US$549.17, is undervalued with a fair value estimate of US$698.08 based on cash flows. Recent earnings reports highlight a turnaround with net income reaching €1.14 billion for 2024 from a previous loss, and earnings are expected to grow significantly at 23.68% annually over the next three years. A strategic alliance with Warner Music Group may enhance revenue streams and strengthen its market position further, supporting future cash flow growth.

• The analysis detailed in our Spotify Technology growth report hints at robust future financial performance.
• Click here to discover the nuances of Spotify Technology with our detailed financial health report.

Taking Advantage

• Navigate through the entire inventory of 180 Undervalued US Stocks Based On Cash Flows here.
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Searching for a Fresh Perspective?

• Explore high-performing small cap companies that haven't yet garnered significant analyst attention.
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• 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.

Companies discussed in this article include NasdaqGS:ADSK NYSE:HWM and NYSE:SPOT.

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