Undervalued Small Caps With Insider Activity To Consider In August 2024

As global markets show signs of recovery and hopes for a "soft landing" in the U.S. economy grow, small-cap stocks have also been on the rise, with indices like the Russell 2000 gaining momentum. Amid this optimistic backdrop, identifying undervalued small-cap stocks with notable insider activity can offer promising opportunities for investors looking to capitalize on market trends. In such a dynamic environment, a good stock often exhibits strong fundamentals and insider confidence, which can be particularly telling indicators of potential growth and resilience.

Top 10 Undervalued Small Caps With Insider Buying

Name	PE	PS	Discount to Fair Value	Value Rating
Ramaco Resources	11.8x	0.9x	36.82%	★★★★★★
Calfrac Well Services	2.6x	0.2x	35.13%	★★★★★★
Bytes Technology Group	24.8x	5.6x	12.05%	★★★★★☆
Thryv Holdings	NA	0.8x	23.62%	★★★★★☆
Norcros	7.4x	0.5x	4.45%	★★★★☆☆
Primaris Real Estate Investment Trust	11.0x	2.9x	45.05%	★★★★☆☆
NSI	NA	4.5x	44.56%	★★★☆☆☆
Sagicor Financial	1.3x	0.3x	-43.72%	★★★☆☆☆
Community West Bancshares	18.7x	2.9x	42.25%	★★★☆☆☆
Delek US Holdings	NA	0.1x	-91.86%	★★★☆☆☆

Click here to see the full list of 207 stocks from our Undervalued Small Caps With Insider Buying screener.

Here's a peek at a few of the choices from the screener.

Codan (ASX:CDA)

Simply Wall St Value Rating: ★★★☆☆☆

Overview: Codan specializes in the development and manufacturing of communication equipment and metal detection technologies, with a market cap of approximately A$1.25 billion.

Operations: Codan's primary revenue streams are from its Communications segment, generating A$291.50 million, and Metal Detection segment, contributing A$212.20 million. The company's gross profit margin has shown fluctuations, reaching 54.42% in the latest period ending December 31, 2023.

PE: 34.9x

Codan, a small-cap company, reported impressive earnings for the year ending June 30, 2024. Sales rose to A$550.5 million from A$456.5 million last year, with net income increasing to A$81.3 million from A$67.7 million. Insider confidence is evident with notable share purchases over the past six months. Despite relying solely on external borrowing for funding, Codan's forecasted annual earnings growth of 16.2% suggests potential for future value appreciation in its sector.

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

• Assess Codan's past performance with our detailed historical performance reports.

Distribution Solutions Group (NasdaqGS:DSGR)

Simply Wall St Value Rating: ★★★☆☆☆

Overview: Distribution Solutions Group operates in the industrial distribution sector, providing a wide range of products and services through its segments Lawson, TestEquity, and Gexpro Services with a market cap of approximately $1.42 billion.

Operations: Distribution Solutions Group generates revenue from multiple segments, including Lawson ($463.59M), Testequity ($782.97M), and Gexpro Services ($402.23M). The company has seen fluctuations in its net income margin, with a recent peak at 1.68% and a low of -1.25%. Gross profit margins have ranged from 25.08% to 36.03%, indicating variability in cost management efficiency over time.

PE: -79.9x

Distribution Solutions Group (DSG) has demonstrated insider confidence with recent share purchases, indicating strong belief in the company's future. From April to June 2024, DSG repurchased 55,844 shares for $1.68 million. Despite being dropped from multiple Russell indexes in July, DSG's earnings report showed significant growth in sales to $439.54 million for Q2 2024 compared to $377.98 million a year ago. The company is actively seeking acquisitions and recently increased its borrowing capacity to $1.06 billion, positioning itself for strategic expansion and potential long-term growth.

• Delve into the full analysis valuation report here for a deeper understanding of Distribution Solutions Group.

• Review our historical performance report to gain insights into Distribution Solutions Group's's past performance.

Calibre Mining (TSX:CXB)

Simply Wall St Value Rating: ★★★★☆☆

Overview: Calibre Mining is a gold mining and exploration company with operations primarily focused on producing refined gold, boasting a market cap of approximately $0.57 billion (CAD).

Operations: Calibre Mining's primary revenue stream is from refined gold, generating $564.69 million. The company's gross profit margin has shown variability, most recently at 42.07% for the period ending June 30, 2024. Operating expenses and non-operating expenses have also fluctuated, impacting net income margins which were recorded at 9.30% in the same period.

PE: 26.4x

Calibre Mining has shown insider confidence with notable share purchases in the past six months. Recent drill results from its Eastern Borosi Mine Complex revealed high-grade gold intercepts, such as 13.24 g/t Au over 5.8 metres, underscoring exploration success. Despite a dip in Q2 earnings to US$20.76 million from US$33.2 million last year, production guidance for 2024 remains strong at up to 300,000 ounces of gold, indicating potential growth ahead for this small cap stock.

• Take a closer look at Calibre Mining's potential here in our valuation report.

• Understand Calibre Mining's track record by examining our Past report.

Where To Now?

• Take a closer look at our Undervalued Small Caps With Insider Buying list of 207 companies by clicking here.
• Are any of these part of your asset mix? Tap into the analytical power of Simply Wall St's portfolio to get a 360-degree view on how they're shaping up.
• Simply Wall St is your key to unlocking global market trends, a free user-friendly app for forward-thinking investors.

Curious About Other Options?

• 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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