Discover 3 Undervalued Small Caps With Insider Action To Enhance Your Portfolio

In a week marked by volatility and mixed economic signals, the S&P 600 Index for small-cap stocks has mirrored broader market fluctuations, reflecting concerns over growth and consumer demand. Amidst this backdrop, identifying undervalued small-cap stocks with insider action can present unique opportunities for investors seeking to enhance their portfolios. A good stock in these conditions often exhibits strong fundamentals and insider buying activity, which can signal confidence from those closest to the company.

Top 10 Undervalued Small Caps With Insider Buying

Name	PE	PS	Discount to Fair Value	Value Rating
Bytes Technology Group	24.9x	5.6x	11.43%	★★★★★☆
Nexus Industrial REIT	2.7x	3.3x	22.31%	★★★★★☆
AtriCure	NA	2.7x	40.03%	★★★★★☆
Lindblad Expeditions Holdings	NA	0.7x	47.41%	★★★★★☆
Citizens & Northern	12.7x	2.8x	44.41%	★★★★☆☆
PCB Bancorp	11.1x	2.8x	42.01%	★★★★☆☆
CVS Group	22.5x	1.2x	40.63%	★★★★☆☆
MYR Group	34.3x	0.5x	41.93%	★★★☆☆☆
Community West Bancshares	18.7x	2.9x	42.25%	★★★☆☆☆
Delek US Holdings	NA	0.1x	-107.44%	★★★☆☆☆

Click here to see the full list of 199 stocks from our Undervalued Small Caps With Insider Buying screener.

We're going to check out a few of the best picks from our screener tool.

NRW Holdings (ASX:NWH)

Simply Wall St Value Rating: ★★★★☆☆

Overview: NRW Holdings is an Australian-based company providing civil construction, mining services, and urban infrastructure solutions with a market cap of approximately A$1.20 billion.

Operations: NRW Holdings generates revenue primarily through its core operations, with the cost of goods sold (COGS) and operating expenses being significant components of its financial structure. The company has seen fluctuations in its net income margin, which was -0.29% for the quarter ending 2015-09-30 and improved to 3.57% by 2024-06-30. Over recent periods, NRW's gross profit margin has ranged from a low of 41.30% to a high of 48.43%.

PE: 15.4x

NRW Holdings, a small player in the construction and mining services sector, recently reaffirmed its revenue guidance for fiscal year 2024 at A$2.9 billion. On August 15, they reported earnings aligning with expectations. Notably, insider confidence is evident with recent share purchases by executives over the past three months. Despite reliance on external borrowing for funding, projected annual earnings growth of 9.45% indicates potential for future value appreciation.

• Take a closer look at NRW Holdings' potential here in our valuation report.

• Explore historical data to track NRW Holdings' performance over time in our Past section.

AtriCure (NasdaqGM:ATRC)

Simply Wall St Value Rating: ★★★★★☆

Overview: AtriCure specializes in developing and selling surgical and medical equipment, with a market cap of approximately $2.20 billion.

Operations: AtriCure generates revenue primarily from the sale of surgical and medical equipment, with recent quarterly revenue reaching $429.95 million. The company's gross profit margin has shown a consistent trend around 74.84%, while net income margins have varied, most recently at -9.33%.

PE: -29.0x

AtriCure, a small-cap medical device company, recently reported Q2 sales of US$116.27 million, up from US$100.92 million last year, though net losses widened to US$8.01 million. They forecast 2024 revenue between US$456 million and US$461 million, reflecting 15% growth at the midpoint. Despite being unprofitable and reliant on external borrowing for funding, insider confidence is evident with recent share purchases in July 2024. Regulatory approval in China for their AtriClip device could boost future prospects significantly.

• Delve into the full analysis valuation report here for a deeper understanding of AtriCure.

• Gain insights into AtriCure's historical performance by reviewing our past performance report.

MDA Space (TSX:MDA)

Simply Wall St Value Rating: ★★★☆☆☆

Overview: MDA Space is a Canadian company specializing in geointelligence, robotics and space operations, and satellite systems with a market cap of approximately CA$0.93 billion.

Operations: MDA Space generates revenue from Geointelligence, Robotics & Space Operations, and Satellite Systems. For the period ending June 30, 2024, the company reported a revenue of CA$860.80 million with a net income of CA$47.60 million and a gross profit margin of 32.41%.

PE: 37.6x

MDA Space recently reported second-quarter sales of C$242 million, up from C$196 million the previous year, with net income rising to C$11 million. They raised their full-year 2024 revenue guidance to between $1.02 billion and $1.06 billion, indicating solid growth prospects. The company secured a significant $1 billion contract from the Canadian Space Agency for the Canadarm3 program and appointed Janet McEachern as interim CFO in July 2024. Insider confidence is evident with Independent Chairman Brendan Paddick purchasing 85,000 shares valued at over C$1 million in recent months.

• Click here and access our complete valuation analysis report to understand the dynamics of MDA Space.

• Understand MDA Space's track record by examining our Past report.

Key Takeaways

• Dive into all 199 of the Undervalued Small Caps With Insider Buying we have identified here.
• Have you diversified into these companies? Leverage the power of Simply Wall St's portfolio to keep a close eye on market movements affecting your investments.
• Simply Wall St is your key to unlocking global market trends, a free user-friendly app for forward-thinking investors.

Searching for a Fresh Perspective?

• Explore high-performing small cap companies that haven't yet garnered significant analyst attention.
• Fuel your portfolio with companies showing strong growth potential, backed by optimistic outlooks both from analysts and management.
• Find companies with promising cash flow potential yet trading below their fair value.

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.

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