With government bond markets, oil prices and manufacturing data all pulling in different directions across major regions, many investors are looking for simple ways to focus on what really matters: cash. The Undervalued Stocks Based On Cash Flows screener targets companies where projected cash generation is strong yet the share price sits below SWS DCF fair value estimates. That combination can appeal if you want potential value without betting on any single sector. This article highlights three stocks from the screener that currently stand out on cash flow potential and valuation signals.

DLocal (DLO)

Overview: DLocal is a Uruguay based payments company that helps global online merchants accept and send money across emerging markets using cards, bank transfers, cash and a wide range of local alternative payment methods. Its platform sits between international businesses and local payment systems so clients in areas like e commerce, streaming and ride hailing can reach customers and pay partners in more than 60 countries.

Operations: DLocal generates essentially all of its US$1.21b in revenue from payment processing, with income diversified across Brazil, Mexico, Argentina and a wider mix of Latin American and other international markets.

Market Cap: US$4.49b

DLocal stands out in this cash flow focused screener because it combines a capital light payments model with high profitability, including a 34.7% return on equity and what is described as high quality earnings. Investors do need to weigh risks such as take rate pressure, funding entirely from external borrowing and recent margin compression. Partnerships with groups like ACI Worldwide and index inclusions in 2026 are cited as indicators of its role for merchants that want access to emerging market payments.

DLocal’s high return on equity and capital light model can look like a powerful cash engine, yet the full picture is not obvious from headline numbers alone. Put the pieces together with the DCF valuation analysis for DLocal

Flex (FLEX)

Overview: Flex is a global manufacturing and supply chain company that designs, builds and manages complex hardware for clients across data centers, communications, automotive, healthcare, industrial and consumer markets, helping large customers turn product ideas into high volume, reliable production.

Operations: Flex generates US$29.3b in revenue, led by Integrated Technology Solutions at US$11.6b, Regulated Manufacturing Solutions at US$10.5b and Cloud and Power Infrastructure at US$7.2b, with sales spread across major manufacturing hubs including Mexico, the United States, China and Malaysia.

Market Cap: US$43.39b

Flex sits at the crossroads of AI hardware, data center build out and regionalized manufacturing, which is why many investors are watching it closely. The company is tied into AI infrastructure through its Cloud and Power Infrastructure segment and recent partnerships around high density compute, while management is preparing a spin off of that unit to sharpen focus and potentially surface value. At the same time, Flex carries high debt, thin margins around 3% and meaningful customer concentration, so execution and capital allocation really matter. Some observers see the stock trading below certain cash flow based fair value estimates, but the full risk reward trade off only becomes clear once you dig into segment level cash generation, margin trends and the SpinCo structure.

Flex’s thin margins and heavy AI exposure could be masking a very different story about cash flow resilience and concentration risk. Get the full picture with the analysis report for Flex

Palantir Technologies (PLTR)

Overview: Palantir Technologies builds software platforms that help governments and large companies turn huge amounts of data into decisions, from counterterrorism and defense operations to insurance claims, industrial systems and AI assisted workflows. Its Gotham, Foundry, Apollo and Artificial Intelligence Platform products are used to integrate data, run analytics and deploy AI models across sensitive, regulated and mission critical environments.

Operations: Palantir generates about US$2.77b from government clients and US$2.45b from commercial customers, with most revenue coming from the United States alongside contributions from the United Kingdom and the rest of the world.

Market Cap: US$301.22b

Palantir Technologies sits in this cash flow focused screen because it combines high margins and strong net profit, with a balance sheet that carries cash and no debt, while still trading below one estimate of fair value despite a rich P/E multiple. Q2 2026 results showed very large growth in revenue, especially in US commercial and government contracts. This supports the view that its AI and defense platforms are gaining traction across core accounts. The flip side is funding risk given reliance on external sources, premium valuation and debate about how long rapid growth can continue. If you are weighing whether this premium software stock is priced fairly for its contract pipeline, AI partnerships and government ties, the valuation and cash flow detail behind this screener pick matters a lot.

Palantir Technologies is being priced like a premium AI and defense platform, yet its cash rich balance sheet and contract mix hint at a different story. See how the analyst forecasts for Palantir Technologies lines up with one critical pressure point that could change everything.

The three stocks covered here are only a small sample, and the full Undervalued Stocks Based On Cash Flows screen currently flags 779 more companies where cash generation and discounted pricing combine into equally interesting stories. Identify and analyze the highest conviction ideas for your own watchlist by using filters for cash flow strength, balance sheet quality and valuation signals across the full Undervalued Stocks Based On Cash Flows screener.

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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.