See all posts by Jonathan Smith FREE REPORT: Why this £5 stock could be set to surge Image source: Getty Images. Renowned stock-picker Mark Rogers and his analyst team at The Motley Fool UK have named 6 shares that they believe UK investors should consider buying NOW.So if you’re looking for more stock ideas to try and best position your portfolio today, then it might be a good day for you. Because we’re offering a full 33% off your first year of membership to our flagship share-tipping service, backed by our ‘no quibbles’ 30-day subscription fee refund guarantee. 3 UK shares that I think are undervalued right now Enter Your Email Address Jonathan Smith | Thursday, 4th February, 2021 Get the full details on this £5 stock now – while your report is free. Our 6 ‘Best Buys Now’ Shares I would like to receive emails from you about product information and offers from The Fool and its business partners. Each of these emails will provide a link to unsubscribe from future emails. More information about how The Fool collects, stores, and handles personal data is available in its Privacy Statement. Simply click below to discover how you can take advantage of this. jonathansmith1 has no position in any of the shares mentioned. The Motley Fool UK has recommended Lloyds Banking Group. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors. Are you on the lookout for UK growth stocks?If so, get this FREE no-strings report now.While it’s available: you’ll discover what we think is a top growth stock for the decade ahead.And the performance of this company really is stunning.In 2019, it returned £150million to shareholders through buybacks and dividends.We believe its financial position is about as solid as anything we’ve seen.Since 2016, annual revenues increased 31%In March 2020, one of its senior directors LOADED UP on 25,000 shares – a position worth £90,259Operating cash flow is up 47%. (Even its operating margins are rising every year!)Quite simply, we believe it’s a fantastic Foolish growth pick.What’s more, it deserves your attention today.So please don’t wait another moment. There are many different types of investing strategies. Recently, the surge in retail traders pumping up stock prices has shone the spotlight on momentum investing. This is when investors jump on the back of an existing move higher in a share price. Another strategy is income investing, buying stocks for the dividend payouts. A strategy I particularly like is value investing. This involves me picking UK shares that are undervalued and buying them when I think they’re cheap. How can I tell if a UK share is undervalued?But what does cheap mean? There isn’t one particular metric used to tell if a UK share is undervalued. If there was, then everyone would have the golden formula, and a stock would likely always trade at that price! 5G is here – and shares of this ‘sleeping giant’ could be a great way for you to potentially profit!According to one leading industry firm, the 5G boom could create a global industry worth US$12.3 TRILLION out of thin air…And if you click here we’ll show you something that could be key to unlocking 5G’s full potential…One metric is the price-to-earnings ratio. This measures what premium I’m paying for buying a stock. Is it 10 times earnings, 20 times, 100 times? Obviously buying a stock that trades at 100 times earnings could be viewed as overvalued. To get a comparative figure, the FTSE 100 average is around 17.5. Another valuation technique is the enterprise value. This is a measure of the net-worth of a business, taking into account debt levels along with cash and tangible assets. I can compare this to the market capitalisation of the company. The market capitalisation is the stock price multiplied by the number of shares available. Although the enterprise value stays fairly constant, the market capitalisation fluctuates all the time, depending on the stock price.Even these two measures aren’t 100% reliable. A P/E ratio may be low as profits are falling, so it might not be a good undervalued stock to buy. The enterprise value might only be calculated a couple of times a year when the latest financial results come out. So it’s not always easy to get an up-to-date view on the value.Some stocks that I think are undervaluedBoth Barratt Developments and Legal & General have P/E ratios below 9. This is substantially below the FTSE 100 average and so make the UK shares look undervalued to me. Barratt is a UK housebuilder showing good signs of recovering from Covid-19. Home completions for H2 2020 were up 9.2% on the previous year, with forward sales for 2021 up 14.3%.Legal & General is a financial services company that has ridden out the pandemic well. The business is also one of the few within the FTSE 100 to keep paying out dividends. The dividend yield has been above 6% for the past year, which is another reason (aside from the valuation) that makes it look attractive in my eyes.As I wrote last week, Lloyds Banking Group shares have seen a steep fall over the past year. This means the market capitalisation is £24.6bn versus an enterprise value of £34.8bn. If we assumed the UK share rose to a point where it equalled the enterprise value, it would price the stock around 49p. This is in comparison to a share price of 34p currently.All of the above stocks could be seen as risky. My figures of valuation are subjective. Therefore they could all move lower in the short-term, and not return to a fairer value for a significant period. This is a risk, but I think my long-term timeline increases my chances of a positive return.