Exploring 3 Undervalued Small Caps With Insider Action In Global Markets

Amidst a backdrop of rising inflation and volatile treasury yields, global markets have shown mixed performance, with small-cap stocks underperforming compared to their larger counterparts. As investors navigate these uncertain times, identifying opportunities in undervalued small-cap stocks can be appealing, especially when insider activity suggests potential confidence in the company's prospects.

Top 10 Undervalued Small Caps With Insider Buying

Name	PE	PS	Discount to Fair Value	Value Rating
4imprint Group	17.8x	1.5x	28.99%	★★★★★☆
Maharashtra Seamless	10.2x	1.6x	47.72%	★★★★★☆
Speedy Hire	NA	0.2x	24.81%	★★★★★☆
Gamma Communications	22.9x	2.4x	33.35%	★★★★☆☆
ABG Sundal Collier Holding	11.6x	1.8x	22.46%	★★★★☆☆
Logistri Fastighets	12.6x	8.9x	36.22%	★★★★☆☆
Franchise Brands	40.6x	2.1x	22.04%	★★★★☆☆
Optima Health	NA	1.5x	47.04%	★★★★☆☆
Fourlis Holdings	8.3x	0.4x	-195.34%	★★★☆☆☆
Mukand	14.7x	0.3x	5.61%	★★★☆☆☆

Click here to see the full list of 182 stocks from our Undervalued Small Caps With Insider Buying screener.

Let's uncover some gems from our specialized screener.

Proact IT Group (OM:PACT)

Simply Wall St Value Rating: ★★★★☆☆

Overview: Proact IT Group is a leading independent integrator in data center and cloud services, operating across regions including the Nordics & Baltics, UK, West (Belgium and Netherlands), and Central (Czech Republic and Germany), with a market capitalization of SEK 3.21 billion.

Operations: The company generates revenue primarily from its operations in the Nordics & Baltics, UK, West (Belgium and Netherlands), and Central (Czech Republic and Germany) regions. The gross profit margin has shown a notable trend, reaching 24.84% by the end of 2024. Operating expenses include significant allocations to sales & marketing and general & administrative functions.

PE: 15.8x

Proact IT Group, a smaller company in the tech sector, recently reported Q4 2024 earnings with revenue at SEK 1,268.5 million and net income of SEK 50.3 million, both down from last year. Despite this dip, insider confidence is evident through share purchases over the past year. The board proposed a dividend increase to SEK 2.40 per share for May 2025. CEO Jonas Hasselberg announced his resignation after significantly growing Proact's revenue and profits during his tenure.

• Navigate through the intricacies of Proact IT Group with our comprehensive valuation report here.

• Gain insights into Proact IT Group's past trends and performance with our Past report.

Puregold Price Club (PSE:PGOLD)

Simply Wall St Value Rating: ★★★★★☆

Overview: Puregold Price Club operates a retailing business, focusing on supermarket and hypermarket formats, with a market capitalization of ₱92.86 billion.

Operations: The company's primary revenue stream is its retailing business, generating ₱211.71 billion. Cost of goods sold (COGS) significantly impacts profitability, with gross profit margins fluctuating between 16.23% and 18.42% over recent periods. Operating expenses are a substantial component of costs, including general and administrative expenses that have reached ₱17.61 billion in the latest period analyzed.

PE: 8.5x

Puregold Price Club, a prominent player in the retail sector, attracts attention due to its potential for growth with earnings forecasted to rise by 10.8% annually. Despite relying entirely on external borrowing for funding, which poses higher risk compared to customer deposits, insider confidence is evident through recent share purchases. This reflects optimism about future prospects. The company recently appointed a new Vice President for Operations and approved its 2025 management plans and budget during board meetings in early 2025.

• Get an in-depth perspective on Puregold Price Club's performance by reading our valuation report here.

• Learn about Puregold Price Club's historical performance.

Xingda International Holdings (SEHK:1899)

Simply Wall St Value Rating: ★★★★☆☆

Overview: Xingda International Holdings is a company that specializes in the production of radial tire cords, bead wires, and other wires, with a market cap of CN¥3.45 billion.

Operations: The company's revenue primarily comes from the sale of radial tire cords, bead wires, and other wires, totaling CN¥12.24 billion. Over recent periods, the gross profit margin has shown fluctuations, with a notable decrease to 19.46% in the latest period from a higher percentage in previous years. Operating expenses have been significant but relatively stable around CN¥1.64 billion recently, impacting net income margins which have also varied over time but currently stand at 3.67%.

PE: 5.3x

Xingda International Holdings, a company with recent insider confidence, saw significant share purchases by insiders over the past six months. The firm approved a special dividend of HK$0.15 per share to be paid on February 21, 2025, reflecting strong retained earnings management. However, its debt is not well covered by operating cash flow and relies entirely on external borrowing for funding. Recent M&A activity includes Liu Jinlan acquiring an additional 26.41% stake for approximately HK$660 million in November 2024.

• Delve into the full analysis valuation report here for a deeper understanding of Xingda International Holdings.

• Evaluate Xingda International Holdings' historical performance by accessing our past performance report.

Make It Happen

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Contemplating Other Strategies?

• 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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