10 Undervalued International Stocks You Can Buy Now!
As S&P 500 is at its all time highs, it's become really hard to find bargains in the US market. Here are the 10 undervalued stocks I am watching in the US, Europe and China.
🙏Thanks first!
What do the most valuable brands in the world have in common?
It’s the community. Brands and products feed on the community.
We have a great community here!
I want to start with sending my thanks to
for giving me the idea of writing initiating a regular coverage on undervalued stocks in my watchlist.Also I want to thank
for alerting me that ASML’s revenue growth could be much faster as Apple will transition to the 2nm process for its iPhone 18 series. Here is the article he sent me, enjoy it: https://www.techtimes.com/articles/307863/20241015/apples-iphone-18-use-2nm-chips-tsmc-2026-what-will-it-bring.htmLast but not least, I want to thank
for prompting me to write on ASML last week as I wasn’t planning it because I knew too many people would cover it post earnings. However, it turned out to be a great piece that I enjoyed writing!If you haven’t already done so, please take this as an opportunity to contact me directly through DMs if you have any ideas, questions or simply free time to chat!
Thank you so much!
Problem of Capital Allocation
It’s very interesting that we never run out of problems in investing.
When your position goes down it’s hard to buy because it could go lower.
When they go up, it’s harder to buy because they are more expensive now.
In bad times it's hard to buy because it feels like an ever deepening market crash.
It’s a constant emotional struggle.
In good times, we have another problem: Everything looks expensive so we struggle to deploy fresh capital. That’s a fine problem to have, but it’s still a problem.
If there is one thing harder than buying a stock you like at lower prices, it’s buying it at higher prices.
Good investing requires a deliberate strategy to deploy fresh capital.
Here is how I approach it:
Look at your portfolio first.
There may be some stocks in your portfolio that haven’t caught up with others yet. If you still like them, don’t look any further. Just add on them.
Some stocks in your portfolio may look extended, however their earnings might also have caught up with the price so there is really no or very little multiple expansion. It naturally makes sense to add on them.
If you can’t find any of these in your portfolio, it makes sense to look beyond it.
Look at stocks you previously owned.
The stocks you previously owned make up your natural watchlist. They are naturally included in your investable universe.
Just don’t look at the ones you sold because you decided they have lousy business economics. Look at the stocks you still liked but sold for different reasons.
You might have sold them because you thought there were better opportunities available, or they remained flat for long so you didn’t want to carry the opportunity cost or simply they went too far too fast.
Just look at them, you may find some gems there.
Sail in the blue oceans.
If you haven’t found anything in the first two groups, then it’s time to sail in the blue oceans and find new potentially undervalued situations to add in your portfolio.
I am normally allergic to doing that. I only do that as a last resort.
The reason is simple: If you already have a sufficiently diverse portfolio or a concentrated portfolio of very strong companies you really know, adding another stock increases uncertainty.
That being said, I also currently struggle to deploy fresh capital as stocks in my portfolio appreciated significantly and most of them are ahead of their fundamentals.
This is why I am also looking for new potentially undervalued situations and compiled a list of 10 companies that I intend to expand and keep updated through regular coverage.
Keep in mind that my multibagger picks such as Sofi, Hims, TSMC and Palantir were once in this list of mine. There are at least a few stocks in this list that I believe will become multibaggers in the next few years.
And also, there is one which I think will become a 10x stock.