3 Top Undervalued Small Caps In Australia With Recent Insider Activity

The Australian market has climbed 1.4% in the last 7 days and 15% over the past year, with earnings forecast to grow by 12% annually. In this favorable environment, identifying undervalued small-cap stocks with recent insider activity can provide promising investment opportunities.

Top 10 Undervalued Small Caps With Insider Buying In Australia

Name	PE	PS	Discount to Fair Value	Value Rating
Magellan Financial Group	7.2x	4.5x	40.38%	★★★★★☆
Bigtincan Holdings	NA	1.2x	47.32%	★★★★★☆
Bapcor	NA	0.8x	46.56%	★★★★☆☆
Corporate Travel Management	20.4x	2.4x	3.65%	★★★★☆☆
GWA Group	16.4x	1.5x	41.69%	★★★★☆☆
Eagers Automotive	10.4x	0.3x	39.01%	★★★★☆☆
Coventry Group	212.7x	0.4x	-8.09%	★★★☆☆☆
Dicker Data	20.3x	0.7x	-67.25%	★★★☆☆☆
BSP Financial Group	7.9x	2.8x	0.96%	★★★☆☆☆
Credit Corp Group	20.6x	2.8x	40.67%	★★★☆☆☆

Click here to see the full list of 24 stocks from our Undervalued ASX Small Caps With Insider Buying screener.

Underneath we present a selection of stocks filtered out by our screen.

Centuria Capital Group (ASX:CNI)

Simply Wall St Value Rating: ★★★★☆☆

Overview: Centuria Capital Group is an investment manager specializing in property funds management, development, and finance with a market cap of A$1.50 billion.

Operations: Centuria Capital Group generates revenue primarily from Property Funds Management (A$167.03 million), Co-Investments (A$54.13 million), and Development activities (A$44.50 million). The company has experienced fluctuations in its gross profit margin, which peaked at 89.33% in Q2 2020 and was lowest at 41.37% in Q2 2017, indicating variability in cost management over time. Operating expenses have varied significantly, impacting net income margins that ranged from a high of 22.39% in Q2 2024 to a low of 3.12% in Q4 2023.

PE: 22.8x

Centuria Capital Group's recent earnings report for the year ending June 30, 2024, revealed sales of A$327.03 million and a net income jump to A$73.21 million from A$32.29 million last year. Basic earnings per share increased to A$0.09 from A$0.04 previously, reflecting significant growth despite a decline in sales. Insider confidence is evident with notable share purchases in the past months, suggesting potential undervaluation and future growth prospects for this small cap stock in Australia’s market.

• Click to explore a detailed breakdown of our findings in Centuria Capital Group's valuation report.

• Assess Centuria Capital Group's past performance with our detailed historical performance reports.

Corporate Travel Management (ASX:CTD)

Simply Wall St Value Rating: ★★★★☆☆

Overview: Corporate Travel Management provides travel services across Asia, Europe, North America, and Australia/New Zealand with a market cap of A$2.85 billion.

Operations: Corporate Travel Management generates revenue primarily from travel services across Asia, Europe, North America, and Australia/New Zealand. The company's gross profit margin has shown variability over time, reaching 40.18% as of September 2023. Operating expenses include significant general and administrative costs along with depreciation and amortization expenses.

PE: 20.4x

Corporate Travel Management, a small-cap company in Australia, has shown promising signs of being undervalued. For the fiscal year ending June 30, 2024, it reported sales of A$710.42 million and net income of A$84.45 million, reflecting growth from the previous year. The company repurchased 1,488,232 shares for A$23.14 million between January and June 2024 and extended its buyback plan to June 2025 with an additional authorization of A$26.1 million. Insider confidence is evident as Jamie Pherous purchased 87,500 shares worth approximately A$1.40 million recently.

• Take a closer look at Corporate Travel Management's potential here in our valuation report.

• Gain insights into Corporate Travel Management's historical performance by reviewing our past performance report.

Sims (ASX:SGM)

Simply Wall St Value Rating: ★★★★★☆

Overview: Sims operates in the recycling and waste management industry, focusing on metal recycling and electronic lifecycle services, with a market cap of A$3.84 billion.

Operations: The company generates revenue primarily from North America Metals (A$4.49 billion) and Australia/New Zealand Metals (A$1.60 billion). For the period ending 2023-09-30, it reported a gross profit margin of 9.91%, with operating expenses amounting to A$836.1 million and non-operating expenses at -A$184 million.

PE: 1297.1x

Sims recently reported a net loss of A$57.8 million for the year ending June 30, 2024, compared to a net income of A$181.1 million the previous year. Despite this, earnings are forecasted to grow by 41.25% annually. Profit margins have dropped from 3% to 0.02%. Insider confidence is evident with recent share purchases in August and September 2024, indicating potential growth prospects despite current challenges in profitability and dividend cuts to A$0.10 per share for the year ended June 30, 2024.

• Navigate through the intricacies of Sims with our comprehensive valuation report here.

• Gain insights into Sims' past trends and performance with our Past report.

Key Takeaways

• Embark on your investment journey to our 24 Undervalued ASX Small Caps With Insider Buying selection here.
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Seeking Other Investments?

• Explore high-performing small cap companies that haven't yet garnered significant analyst attention.
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• 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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