7 cheap stocks in the 7th cheapest stock market.

The Swedish stock market is currently the seventhcheapest stock market based on P/E. When I investigated the companies that are trading under the long-term average P/E of 17.1, I often find a financial or performance-based reason to explain why. But here are seven companies I believe have been misunderstood by Wall Street and are worth taking a closer look at.

Nordea (XOME:NDA)

Nordea is the largest bank in Scandinavia, trading at a P/E at 12.5. It operates in8 home markets: Denmark, Finland, Norway and Sweden and the New European Markets of Estonia, Latvia, Lithuania and Russia. Nordea is a market leader in most of the Nordic markets in both retail and wholesale banking, and has the largest customer base of any financial services group in that region withapproximately 10 million household customers andaround 0.5 million corporate customers. Its loan loss ratio went down from 21 basis points to 15 basis points. Nordea is a bank in a category too big to fail and they seem to be getting stronger and stronger.

Svenska Handelsbanken (XOME:SHB)

Handelsbanken is a full-service bank with a nationwide branch network in Sweden, the UK, Denmark, Finland, Norway and the Netherlands.The bank regards these six countries as its home markets. Handelsbanken is currently trading at a P/E at 13.4. According to the Swedish quality index, Handelsbanken has the most satisfied costumers in the whole sector. Furthermore Handelsbanken has been acclaimed Bank of the Year for 2013 by the business magazine Privata Affrer. This is the third time in five years they have received the award. What is notable is the banks ability to keep investors invested even when the market is down.

Unibet (XOME:UNIB)

Unibet is one of the largest online gambling operators in theEuropean market with over9.5 millioncustomers worldwide, operating in 22 different languages in more than 100 countries. Currently trading at a P/E at 10.7. The company delivered 26 percent growth in gross winnings revenue in the third quarter. That growth was wholly organic, and demonstrates continued increases in market share. Unibets products are mainly sport betting and online casino and with the increasing interest in gambling, perhaps Unibet could be a strong bet.

Modern Times Group (XOME:MTG)

Modern Times Group (MTG) is an international entertainment-broadcasting group with operations that spansix continents and include free-TV, pay-TV, radio and content production businesses. MTG is currently trading at a P/E at 17. This may be the highest P/E of all these 7 companies, but it still looks like a bargain at these prices. Even with uncertainty in the Russian markets, third quarter net sales were up 12 % with operating income (EBIT) up 32 %. Especially its online services are increasing rapidly, which is a good sign for the future. MTG has recently signed a content distribution agreement with, a wholly owned subsidiary of The Walt Disney Company, and has extended its Formula One distribution contract for the Baltics and Scandinavia. Furthermore, it has prolonged its exclusive rights for Nickelodeon in the Nordic region until 2020. MTG expects an outlook of 12% growth trajectory.

Skanska (XOME:SKAb)

Skanska is one of the world's leading project development and construction groups, concentrated on selected home markets in the Nordic region, other European countries and in the Americas and is trading at a P/E at 16.4. Revenue increased by 4 % in the third quarter and earnings per share increased by 1 percent. Even though times in the construction business are not currently looking too bright, order bookings where still up 22 % compared to last quarter. Skanska has a lot of orders in the US, and it seems like thats where the growth is likely to come from.

Lindab group (XOME:LIAB)

Lindab is an international group thatdevelops, manufactures, markets and distributes products and system solutions for simplified construction and improved indoor climate. Lindab produces rainwater systems, ventilation systems, and buildings. Its revenue grew 9% this quarter and is trading at a P/E at 16.4. Even with a slowing market especially in Russia and Belarus, and with the building systems segment as a whole falling by 1 percent this quarter, the company showed an increase in sales of 11 %. Lindab is strengthening its roof systems by acquiring a leading European manufacturer of fastening systems for standing seam roofing for different types of roof construction.

Bilia (XOME:BILI_a)

Bilia is Scandinavias largest car chain with over 97 facilities in Sweden, Norway and Denmark. Bilia offers car sales, service and supplementary services. Bilia is trading at a P/E at 13.6. The revenue grew by 7% in the third quarter and especially the car sales grew by 10%. Bilia has acquired the Toyota dealership in the southern part of Sweden, which is about 5% of Bilias revenue for 2013. This is according to Bilia just their first step to migrate Toyota into the family. Volvo is making new cars for 2015 with a newer and smarter look as its competes with Audi, BMW and Mercedes, and as the official dealer of Volvo in Scandinavia, Bilia can benefit from this in the future.

Theres no doubt that Sweden offers some interesting investing opportunities, many Swedish companies are internationally exposed, with a few exceptions. These companies are chosen from a P/E screening, and after going through many low P/E ratio companies, Ive found that these companies are worth investigating some more. What these 7 companies have in common is that they look like they could be a part of the Foolish family, with qualities like great leadership, strong products and first movers in their industry. Maybe theres a future investment among these seven companies in the world's seventh cheapest stock market.

The article 7 cheap stocks in the 7th cheapest stock market. originally appeared on Fool.com.

Jesper Johnsson holds no position in any stocks mentioned in this article.Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.