Exploring December 2024's Undervalued Small Caps With Insider Action

As global markets navigate a challenging landscape marked by the Federal Reserve's cautious stance on interest rate cuts and political uncertainties, small-cap stocks have faced heightened volatility, with indices like the S&P 600 reflecting broader declines. Despite these headwinds, certain small-cap companies may present intriguing opportunities for investors as they exhibit resilience through strong fundamentals and strategic insider actions.

Top 10 Undervalued Small Caps With Insider Buying

Name	PE	PS	Discount to Fair Value	Value Rating
Paradeep Phosphates	24.4x	0.8x	28.81%	★★★★★☆
Maharashtra Seamless	10.8x	1.9x	31.84%	★★★★★☆
Avia Avian	13.8x	3.2x	25.80%	★★★★★☆
East West Banking	3.1x	0.7x	35.07%	★★★★★☆
ABG Sundal Collier Holding	12.8x	2.1x	39.37%	★★★★☆☆
Logistri Fastighets	12.6x	8.9x	42.03%	★★★★☆☆
Optima Health	NA	1.2x	49.69%	★★★★☆☆
Mark Dynamics Indonesia	14.0x	4.6x	0.75%	★★★☆☆☆
Community West Bancshares	18.7x	2.9x	42.25%	★★★☆☆☆
Digital Mediatama Maxima	NA	1.3x	14.65%	★★★☆☆☆

Click here to see the full list of 195 stocks from our Undervalued Small Caps With Insider Buying screener.

Below we spotlight a couple of our favorites from our exclusive screener.

UIE (CPSE:UIE)

Simply Wall St Value Rating: ★★★★☆☆

Overview: UIE is an investment holding company primarily involved in the palm oil industry through its significant ownership in United Plantations Berhad, with a market capitalization of approximately $1.32 billion.

Operations: UP generates revenue primarily through its operations, with a recent revenue figure of $462.25 million. The company's gross profit margin has shown variability, reaching as high as 78.82% in the third quarter of 2023 and standing at 70.52% by the end of September 2024. Operating expenses include significant allocations for general and administrative costs, which were $53.70 million in recent quarters.

PE: 8.1x

UIE, a smaller firm in the market, has shown insider confidence with recent share purchases. In the third quarter of 2024, UIE's sales rose to US$128.52 million from US$115.36 million year-over-year, turning a net loss into a net income of US$32.2 million. Earnings per share improved significantly to US$1.01 from a loss per share of US$0.57 last year, reflecting high-quality earnings despite reliance on external borrowing for funding and large one-off items affecting results.

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

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

Norva24 Group (OM:NORVA)

Simply Wall St Value Rating: ★★★☆☆☆

Overview: Norva24 Group operates in the waste management sector, focusing on providing essential infrastructure maintenance services, with a market capitalization of NOK 3.75 billion.

Operations: Norva24 Group's revenue is primarily derived from waste management services, with recent figures showing a gross profit margin of 46.76%. The company's cost structure includes significant expenses in operating and general & administrative areas, impacting its net income.

PE: 25.9x

Norva24 Group, a small company in the service sector, has seen substantial insider confidence with Henrik Norrbom purchasing 18,000 shares for NOK 561,600 between October and November 2024. Despite a decrease in net income to NOK 49 million from NOK 70.4 million year-on-year for Q3, sales rose to NOK 963.2 million from NOK 785.1 million. The company's earnings are projected to grow by over 21% annually, although its reliance on external borrowing poses higher risk concerns.

• Get an in-depth perspective on Norva24 Group's performance by reading our valuation report here.

• Learn about Norva24 Group's historical performance.

NOTE (OM:NOTE)

Simply Wall St Value Rating: ★★★☆☆☆

Overview: NOTE is an electronics manufacturing services company that operates globally, with significant market presence in Western Europe and a market capitalization of SEK 7.63 billion.

Operations: The company's revenue primarily comes from Western Europe and the Rest of World, with recent total revenues reaching SEK 4.20 billion. Over time, the gross profit margin showed fluctuations, peaking at 13.48% before declining to 12.03%. Operating expenses are a significant cost component, consistently exceeding SEK 100 million in recent periods.

PE: 16.3x

NOTE, a smaller company in the market, is drawing attention with insider confidence as CEO & President Johannes Lind-Widestam purchased 4,000 shares worth SEK 505,200. Despite a dip in third-quarter sales to SEK 809 million from SEK 1,034 million last year and earnings per share dropping to SEK 1.52 from SEK 2.24, the company projects growth with an estimated turnover of up to SEK 4.3 billion for next year. With earnings forecasted to grow annually by over 15%, NOTE's reliance on external borrowing for funding presents both opportunities and risks moving forward.

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

• Review our historical performance report to gain insights into NOTE's's past performance.

Taking Advantage

• Access the full spectrum of 195 Undervalued Small Caps With Insider Buying by clicking on this link.
• Are these companies part of your investment strategy? Use Simply Wall St to consolidate your holdings into a portfolio and gain insights with our comprehensive analysis tools.
• Simply Wall St is your key to unlocking global market trends, a free user-friendly app for forward-thinking investors.

Interested In Other Possibilities?

• 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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