Top 3 Undervalued Small Caps With Insider Buying

As global markets continue to recover, with key indices like the S&P 600 for small-cap stocks showing promising gains, investors are increasingly optimistic about a potential "soft landing" for the U.S. economy. Amid this positive sentiment, retail sales have surged and inflation data has been reassuring, creating a fertile ground for identifying undervalued small-cap stocks that show strong insider buying activity. In such an environment, a good stock often combines solid fundamentals with strategic insider investments. These elements can signal confidence from those closest to the company's operations and prospects.

Top 10 Undervalued Small Caps With Insider Buying

Name	PE	PS	Discount to Fair Value	Value Rating
Nexus Industrial REIT	3.4x	3.4x	26.75%	★★★★★☆
PCB Bancorp	11.2x	2.8x	41.84%	★★★★★☆
Thryv Holdings	NA	0.7x	24.59%	★★★★★☆
Information Services	23.7x	2.1x	-64.82%	★★★★☆☆
Citizens & Northern	12.7x	2.8x	44.43%	★★★★☆☆
NSI	NA	4.5x	44.26%	★★★☆☆☆
Franchise Brands	115.2x	2.9x	49.53%	★★★☆☆☆
Community West Bancshares	18.7x	2.9x	42.25%	★★★☆☆☆
Alta Equipment Group	NA	0.1x	-67.21%	★★★☆☆☆
Titan Machinery	3.3x	0.1x	-23.29%	★★★☆☆☆

Click here to see the full list of 212 stocks from our Undervalued Small Caps With Insider Buying screener.

Let's uncover some gems from our specialized screener.

Codan (ASX:CDA)

Simply Wall St Value Rating: ★★★☆☆☆

Overview: Codan is a company specializing in communications and metal detection technologies, with a market cap of approximately A$1.40 billion.

Operations: Codan generates revenue primarily from its Communications and Metal Detection segments, with recent quarterly revenues reaching A$510.57 million. The company's gross profit margin has shown variability, peaking at 78.07% in March 2024. Operating expenses have been significant, with the latest figures at A$174.85 million for December 2023, impacting net income margins which were last recorded at 14.67%.

PE: 33.2x

Codan, a smaller firm, recently reported full-year earnings ending June 30, 2024. Sales increased to A$550.46 million from A$456.5 million the previous year, while net income rose to A$81.39 million from A$67.7 million. Basic earnings per share climbed to A$0.45 from A$0.375 a year ago, reflecting solid growth prospects with forecasted annual earnings growth of 15%. Insider confidence is evident with recent share purchases in August 2024, indicating belief in future performance despite reliance on external borrowing for funding.

• Dive into the specifics of Codan here with our thorough valuation report.

• Explore historical data to track Codan's performance over time in our Past section.

Hochschild Mining (LSE:HOC)

Simply Wall St Value Rating: ★★★★☆☆

Overview: Hochschild Mining is a precious metals company engaged in the exploration, mining, processing, and sale of gold and silver with key operations at its Inmaculada, San Jose, and Pallancata mines; it has a market cap of approximately £0.58 billion.

Operations: Hochschild Mining generates revenue primarily from its Inmaculada, San Jose, and Pallancata segments. The company's gross profit margin has fluctuated, reaching a high of 42.85% and a low of 8.08% over the observed periods.

PE: -23.0x

Hochschild Mining, a small-cap stock, has shown insider confidence with Eduardo Navarro purchasing 148,000 shares worth £235,320 in July 2024. The company reiterated its production guidance for 2024 at 343,000-360,000 gold equivalent ounces. In Q2 2024, silver production was down to 2.59 million ounces from last year’s 2.96 million ounces; however, gold output increased to 66.37 thousand ounces from the previous year's 54.12 thousand ounces. This mix of insider buying and steady production targets suggests potential value in Hochschild's stock amidst current market conditions.

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

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

Calibre Mining (TSX:CXB)

Simply Wall St Value Rating: ★★★★☆☆

Overview: Calibre Mining is a gold mining company engaged in the exploration, development, and production of gold assets with a market cap of approximately C$0.55 billion.

Operations: Calibre Mining generates revenue primarily from refined gold, with recent quarterly revenue reaching $564.69 million. The company's gross profit margin was 42.07%, and net income margin stood at 9.30%. Operating expenses included significant allocations to general and administrative costs, which amounted to $25.25 million in the latest period.

PE: 25.5x

Calibre Mining, a small-cap gold producer, recently announced promising drill results from its Eastern Borosi Mine Complex in Nicaragua, highlighting significant gold intercepts such as 13.24 g/t over 5.8 meters and 9.24 g/t over 6.2 meters. The company provided consolidated production guidance for 2024 at 275,000-300,000 ounces of gold and reported Q2 earnings with sales of US$137 million and net income of US$20 million. Insider confidence is evident with recent share purchases by executives this year, indicating potential growth prospects despite lower profit margins compared to last year.

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

• Learn about Calibre Mining's historical performance.

Key Takeaways

• Access the full spectrum of 212 Undervalued Small Caps With Insider Buying by clicking on this link.
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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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