Analyzing and picking the undervalued stocks is not a big deal if you know the following parameters.

• Price to Earnings Ration (P/E) – How much earnings per share
• Debt to Equity Ratio
• Free cash flow
• Company’s Return on Equity
• Dividend Ratio
• Low Price or Earnings Ratio
• Current Ratio of the Stock
• Sharp Growth in Earnings
• Check whether the ROE growing above the industry average

The above are the basic parameters to be considered to check whether the stock is undervalued or not.

If you are good at fundamental analysis, it is very easy to estimate the company.