Best Stocks to Invest in 2024 - 3 Undervalued Stocks + Breakout, Stocks for Long Term, Stocks to Buy

Shrija Saha

13 Jun 202409:15

Summary

TLDRThe video script discusses three potential best stocks to invest in for 2024, focusing on undervalued stocks. It outlines a step-by-step method to identify such stocks, emphasizing market capitalization over 5000 and price-to-earnings ratio analysis. The speaker selects top stocks from various sectors, including PSU banks and infrastructure companies, highlighting their growth potential and intrinsic value. The script also mentions a multibagger stock, Ganesha Housing, with strong financials and a promising outlook, encouraging viewers to do their research and consider these stocks for long-term portfolios.

Takeaways

📈 The video discusses three potential best stocks to invest in for 2024, focusing on undervalued stocks.
🔍 The presenter will guide viewers on how to find undervalued stocks using a screener, with a market capitalization filter over 5000 to exclude very small companies.
🏦 The first stock highlighted is Bank of Baroda, a PSU bank that can still rally in specific PSU stocks.
🏘️ The second stock is from the real estate sector, with a focus on a company that has shown consistent growth and has upcoming projects.
🏗️ The third stock is a potential multibagger stock that the presenter plans to add to their long-term portfolio for its intrinsic value and current price level.
📊 The presenter emphasizes the importance of comparing the P/E ratio of companies with the industry P/E to understand the valuation of a company.
📈 The video mentions that some sectors like PSU banks and real estate have already shown a good run-up after the election results, indicating potential for further growth.
💡 The presenter suggests that investors should have a demat account to explore the mentioned stock and understand the reliability of the platform with over 10 lakh users and a turnover of about 5.3 lakh crores.
📉 The video also discusses the potential short-term correction in the market after the election results and advises on the timing for investment.
🏢 The detailed analysis of the mentioned companies includes their financials, growth prospects, and technical analysis, suggesting a multi-year breakout for one of the stocks.
📚 The video concludes with a reminder about market risks and the need for individual research before investing.

Q & A

What is the main topic of the video script?
-The main topic of the video script is about discussing three potential best stocks to invest in for 2024, focusing on undervalued stocks.
What is the first step suggested in the script to find undervalued stocks?
-The first step suggested is to create a screen for finding undervalued stocks with market capitalization over 5000, filtering out very small companies.
What financial ratio is recommended to use for comparing companies to find undervalued stocks?
-The Price to Earnings (P/E) ratio is recommended for comparing companies with the industry P/E to find undervalued stocks.
What is the significance of comparing a company's P/E with its historical five-year median P/E?
-Comparing a company's P/E with its historical five-year median P/E helps to understand if the company is currently undervalued compared to its own past performance.
What is the script's approach to adding a multibagger stock to a long-term portfolio?
-The script suggests adding a multibagger stock to a long-term portfolio for potential growth, emphasizing watching the stock until it shows a good entry point.
Which stock is mentioned as the first stock to discuss in the script?
-The first stock mentioned to discuss is Bank of Baroda, as a PSU bank stock that can still rally in specific PSU stocks.
What is the potential impact of election results on the stocks mentioned in the script?
-The script suggests that if the NDA wins over 272 seats but below 320, there might be a short correction followed by stability in the market and the mentioned stocks could rise.
What is the special feature of the 'm stock' platform mentioned in the script?
-The 'm stock' platform is highlighted for its low brokerage charges, offering a flat fee per order, and for having a large user base with high turnover.
What is the script's view on the construction sector, particularly regarding KNR Construction?
-The script views the construction sector positively, especially KNR Construction, which is based on the Andhra theme and has shown a significant run-up post-election results.
What financial metrics are highlighted for KNR Construction to consider it an undervalued stock?
-The financial metrics highlighted for KNR Construction include its intrinsic value being higher than its current price, a five-year revenue growth, and a net profit margin of 24%.
What is the script's opinion about Ganesha Housing's stock and its potential?
-The script considers Ganesha Housing's stock as a potential multibagger, highlighting its strong presence in the residential sector, consistent growth in revenue, and good financials.
What is the significance of the technical analysis mentioned for Ganesha Housing's stock?
-The technical analysis signifies a multi-year breakout with high volume, indicating a strong upward movement and making the stock attractive for investors.
Why is the script not recommending the discussed stocks as a baseless recommendation?
-The script is not recommending the stocks as it advises viewers to do their own research and is not a financial advisor, emphasizing the importance of personal due diligence.

Outlines

00:00

📈 Stock Investment Strategies for 2024

The script discusses three potential best stocks to invest in for the year 2024, focusing on undervalued stocks. It outlines a step-by-step method to identify these stocks using market capitalization filters, price-to-earnings ratios, and industry comparisons. The speaker plans to add a multibagger stock to their portfolio for long-term gains and advises viewers to watch until the end to understand the selection process. The first stock mentioned is Bank of Baroda, a PSU bank with potential for growth in specific sectors. The video also refers to previous recommendations that have performed well post-election results, suggesting a pattern in the market response to political events.

05:02

🏗️ Infrastructure and Housing Development Stocks

This paragraph delves into the infrastructure theme, particularly focusing on construction and housing development stocks. It highlights the potential of the sector due to high conviction on infrastructural growth, especially with the BJP in power. The speaker mentions a specific stock, KEC International, an infrastructure company based in Andhra Pradesh, which has shown significant growth and has a strong order book. The company's financials are robust, with increasing revenue, profits, and reserves. The stock has also shown a multi-year breakout pattern on technical analysis, indicating a potential for further growth. The speaker adds this stock to their long-term portfolio and advises viewers to conduct their own research before investing.

Mindmap

Keywords

💡Undervalued Stocks

Undervalued stocks refer to shares that are trading at a price that is considered to be lower than their intrinsic value. In the video's context, the speaker is discussing a method to identify such stocks using a screener and focusing on companies with a market capitalization over 5000, which filters out very small companies. The script mentions looking for stocks with a price-to-earnings (P/E) ratio less than the industry average, indicating undervalued stocks as potential investments.

💡Market Capitalization

Market capitalization, often referred to as 'market cap,' is the total market value of a company's outstanding shares of stock. In the script, the speaker sets a threshold of over 5000 for market capitalization to filter out undervalued stocks, implying that larger, more established companies are being considered for investment.

💡Price-to-Earnings Ratio (P/E Ratio)

The price-to-earnings ratio is a valuation ratio calculated by dividing the market value per share by the earnings per share (EPS). It is used to determine if a stock is overvalued or undervalued. The script mentions using the P/E ratio to compare companies with their industry average, with a lower P/E suggesting the stock is undervalued.

💡Intrinsic Value

Intrinsic value is an estimate of the true value of a company based on its fundamentals, such as assets, earnings, and growth prospects. The video discusses finding undervalued stocks by comparing their market price to their intrinsic value, with the goal of identifying stocks that the market may have undervalued.

💡Screener

A screener is a tool used to filter stocks based on specific criteria to find potential investments. The script describes using a screener to find undervalued stocks by setting parameters such as market capitalization and P/E ratio.

💡Long-Term Portfolio

A long-term portfolio refers to a collection of investments intended to be held for an extended period, often years, to achieve long-term financial goals. The speaker mentions adding a multibagger stock to a long-term portfolio, indicating a belief in the stock's potential for significant growth over time.

💡Multibagger Stock

A multibagger stock is a term used in investing to describe a stock that has the potential to increase in value many times over its initial purchase price. The video script discusses adding such a stock to a long-term portfolio for potential high returns.

💡P/E Less than Industry P/E

This concept refers to a stock's P/E ratio being lower than the average P/E ratio of its industry. The script uses this as a criterion for identifying undervalued stocks, suggesting that a stock with a P/E less than the industry average may be undervalued.

💡Growth Prospects

Growth prospects refer to the potential for a company's future expansion and profitability. The script mentions looking at the growth prospects of a stock, such as the potential for increased revenue and net profit, as part of the evaluation process for identifying undervalued stocks.

💡Technical Analysis

Technical analysis is a method used in the stock market to forecast the direction of prices through the study of past market data, primarily price and volume. The script refers to technicals, such as a multi-year breakout on the monthly chart, as a sign of a stock's potential to rise in price.

💡Breakout

A breakout in stock trading occurs when the price of a stock moves above a defined support or resistance level, often signaling a strong upward trend. The script mentions a 'multi-year breakout' as a positive technical signal for a stock's performance.

💡Ganesh Housing

Ganesh Housing is a company mentioned in the script that specializes in the residential sector, primarily catering to the mid and higher-income segments of the market. The video discusses the company's growth, financials, and projects, indicating it as a potential undervalued stock for a long-term portfolio.

💡Revenue Growth

Revenue growth refers to an increase in the income generated from the sale of goods or services. The script highlights Ganesh Housing's revenue growth over the last five years, which is a positive indicator of the company's financial health and potential for future growth.

💡Net Profit

Net profit is the amount of earnings remaining after all expenses have been deducted from revenues. The video script mentions the net profit of Ganesh Housing, which has multiplied over the last five years, showcasing the company's profitability.

💡Operating Cash Flow

Operating cash flow is the cash a company generates through its regular business activities. The script mentions increasing operating cash flow for Ganesh Housing, indicating the company's ability to generate cash from operations, which is a positive sign for investors.

💡Debt-to-Equity Ratio (D/E Ratio)

The debt-to-equity ratio is a financial metric that measures the proportion of a company's financing that comes in the form of debt versus equity. The script indicates a D/E ratio of almost zero for Ganesh Housing, suggesting that the company has very little debt compared to its equity, which is favorable for investors.

💡Book Value

Book value is the value of a company's assets that would remain if all debts were paid off. The script mentions that the stock's intrinsic value is higher than its current market price, with the book value being significantly lower, indicating undervaluation.

💡EPS Growth

EPS growth refers to the increase in earnings per share over time. The script discusses the growth in EPS for Ganesh Housing, which has been impressive over the last five years, indicating the company's profitability and potential for future growth.

💡PE Ratio

The PE ratio, or price-to-earnings ratio, is a measure of the price paid for a share relative to the income or profit earned by the company per share. The script mentions that Ganesh Housing's PE ratio is lower than the industry average, suggesting that the stock may be undervalued.

💡Conservation of Reserves

Conservation of reserves refers to the practice of retaining a portion of profits within a company rather than distributing them as dividends. The script mentions that Ganesh Housing has been increasing its reserves, which can be used for future growth and investment opportunities.

💡Order Book Position

Order book position refers to the total value of orders that a company has on its books but has not yet delivered or completed. The script mentions Ganesh Housing's order book position as being substantial, indicating a strong pipeline of future revenue.

💡Revenue and Net Profit Growth

The script discusses the growth in both revenue and net profit for Ganesh Housing, which has been consistent over the last five years. This consistent growth is a positive sign for investors, as it indicates the company's ability to generate profits and increase its income.

💡Operating Profit Margin

Operating profit margin is a measure of the profit a company makes from its core business operations, calculated by dividing operating profit by revenue. The script mentions an operating profit margin of 24% for Ganesh Housing, which is a healthy indicator of the company's profitability.

Highlights

The focus is on undervalued stocks and how to find them using a step-by-step screener method.

Three best stocks are picked among them, with one being a multibagger stock added to the presenter's portfolio for long-term.

The importance of watching and waiting for the right entry point in the stock market is emphasized.

The first stock discussed is Bank of Baroda, a PSU bank with potential for growth in specific sectors.

The second stock is related to the Modi 3.0 stocks for long-term portfolio after the budget in July.

The presenter shares a list of potential stocks that have already given good returns after the election results.

The discussion includes an analysis of the financials, including P/E ratios, and comparing them with industry standards.

The presenter adds intrinsic value and current price levels to the filters for finding undervalued stocks.

The third stock discussed is a potential multibagger stock in the presenter's opinion, not a recommendation.

Ganesh Housing, a company specializing in the residential sector, is highlighted for its strong presence in the city of Ahmedabad.

The presenter mentions the growth in the residential sector and the potential boost to the outlook of Ganesh Housing stock.

The financials of Ganesh Housing are discussed, including revenue growth, net profit, and operating cash flow.

The presenter talks about the technicals of the stock, including a multi-year breakout and high trading volume.

The potential for a short-term pullback to the 20 EMA is mentioned as a possible entry point for the stock.

The presenter adds positions of the discussed stocks to their portfolio, disclosing it is not a buy or sell recommendation.

The mStock platform is introduced, offering reduced brokerage fees and various investment facilities.

The presenter reminds viewers to do their own research and not to consider the discussion as financial advice.