Best ASX undervalued stocks to buy now

At current valuations, AGL Energy, Reckon and Resimac are proving that undervalued doesn’t necessarily mean underperforming as they are delivering steady cash flows and are backed by growth catalysts.

Best ASX undervalued stocks

Resimac Group Limited (ASX: RMC) 

Reckon Limited (ASX: RKN) 

AGL Energy Limited (ASX: AGL) 

Resimac Group Limited (ASX: RMC) 

looks quite undervalued right now considering its solid earnings, growing loan book and good shareholder returns.
For FY25, the company posted a statutory NPAT of about A$34.6 million which is almost same as last year even after facing higher impairment cost and Normalised operating profit went up by 13% to A$78.6 million.

The company paid a fully franked 19 cps dividend which comes out to an impressive current annual yield of 16.17%.

key valuation metrics also show that it’s trading cheap that is P/E ratio of 13.37 and price to free cash flow ratio of 12.15. With A$13.4 billion home loan AUM, steady margins and focus on digital lending, Resimac stands as a strong undervalued stock offering passive income and future growth in Australia’s finance sector.

Reckon Limited (ASX: RKN) 

is showing good progress in its financials and looks cheap with respect to its intrinsic value.
For the half year ended June 2025, it made revenue of about A$33 million, EBITDA of A$14 million and NPAT around A$4 million. Thats about 35% jump in profit and 16% rise in revenue from last year. 

The new buyout of Cashflow Manager added nearly 20,000 SME clients. Reckon One revenue went up by 26% and the Legal Group saw 18% growth in subscriptions backed by a fully subscribed US$4.5 million funding round at a pre money valuation of US$20 million. 
Company also gave out 2.5 cps fully franked dividend for FY25 which comes to 4.27% annual yield. Valuation metrics support this thesis as It has a P/E ratio of 13.02 and price to free cash flow ratio of only 3.31.

 With a solid balance sheet and scalable, low capex SaaS business model, Reckon looks like a profitable undervalued stock that still has good upside ahead.

AGL Energy Limited (ASX: AGL) 

is still one of the big names in Australia’s clean energy shift. The company keeps making stable cash flows and is slowly building up its renewable energy projects.
Even though it showed a loss on paper because of restructuring and investment write downs, its underlying EBITDA came around A$2.01 billion and NPAT was A$640 million.
The company gave out a fully franked final dividend of 25 cents a share that comes out to an annual yield of about 5.43% and current free cash flow yield stands at 11.77%. 
AGL spent nearly A$900 million in FY25 on large battery projects like the 500 MW Liddell Battery and the 500 MW Tomago Battery, helping strengthen its energy capacity. Its clean energy plan targets 12 GW of new renewable and firming capacity by 2035 while slowly closing coal plants.
With strong cash flow, rising battery assets and focus on customer growth, AGL looks undervalued at the current price.

(Source: Company Announcement)