Even near record highs, the FTSE 100 indexIt’s still home to many value stocks. One company in particular appears to be near the top of the buy list for many institutional investors.

In fact, if these predictions are correct, an investment of £1,000 today could amount to £1,629 by this time next year – an amount 63% return in just 12 months!

Huge discount?

The stock of value in question is Croda International (LSE:CRDA), with analysts at Barclays, UPS, JP MorganBerenberg Bank estimates that the stock is trading strongly below its intrinsic value.

The specialty chemicals group has had a rough ride recently, down more than 70% since the start of 2022.

Why? Because Croda went on to make huge profits from the specialized components needed for him Pfizer‘sand ModernaCOVID-19 vaccines are struggling through a sustained industry-wide cycle of attrition as the pandemic moves into the rearview mirror.

While the collapse in earnings from £649m in 2022 to £62m in 2025 is real, the consensus among institutional analysts today is that investors have been oversold.

Croda is already seeing a rebound in growth across its consumer care and life sciences sectors, with crop protection, in particular, seeing a 14% jump in revenue last year.

At the same time, management is targeting savings of £100m per annum by 2028, with £28m already delivered in 2025, paving the way for a small but notable increase in profit margins. But what is even more encouraging is that thanks to the continued decline in capital expenditures, free cash flow also rose in the second half.

With further improvement expected throughout 2026, core operating margins are on track to expand to 18.4% this year from 17.4% in 2025, before rising to 19.5% in 2027.

However, despite this upward trajectory in the business, the stock price continues to fall into value stock territory.

What are you watching?

Seeing stocks falter while operations improve is exactly the value investors are looking for. But Croda still has some challenges to overcome.

A big concern right now is supply chain disruption. Specialty chemicals typically have very complex supply chains, with production, processing and sale often occurring on different continents. As such, Croda is highly exposed to trade disruptions such as US tariffs.

Another thing to watch is the group’s consumer care segment. Competition has increased significantly in recent years, especially from China and India, undermining Croda’s products and hurting the progress it has made in profit margin recovery.

What is the ruling?

When you take a step back, Croda shares look like a classic recovery play. Compared to the long-term earnings strength of this business, shares are trading at an unusually cheap valuation. But this is only true if the company can continue to rebuild its profit margins and beat its competitors – which is not guaranteed.

However, at today’s valuation, the risk to reward ratio looks very attractive. That’s why I think this value stock is worth a deeper dive. And it’s not the only potential buying opportunity on my radar this week.