Amidst a backdrop of disappointing trade deals and declining major stock indexes, the European market has been navigating through economic challenges with resilient data on GDP, inflation, and economic sentiment. As the pan-European STOXX Europe 600 Index dipped 2.57%, investors are increasingly looking towards small-cap stocks that may offer potential opportunities amidst broader market volatility. Identifying promising investments often involves assessing factors such as insider buying trends and valuation metrics, which can provide insights into a company's potential for growth in uncertain times.
Top 10 Undervalued Small Caps With Insider Buying In Europe
| Name | PE | PS | Discount to Fair Value | Value Rating |
|---|---|---|---|---|
| Oxford Instruments | 39.3x | 2.0x | 20.14% | ★★★★☆☆ |
| Renold | 10.6x | 0.7x | 2.55% | ★★★★☆☆ |
| NCC Group | NA | 1.4x | 11.78% | ★★★★☆☆ |
| Lords Group Trading | NA | 0.2x | 3.34% | ★★★★☆☆ |
| CVS Group | 44.7x | 1.3x | 38.68% | ★★★★☆☆ |
| A.G. BARR | 19.6x | 1.8x | 45.86% | ★★★☆☆☆ |
| SmartCraft | 43.0x | 7.7x | 36.06% | ★★★☆☆☆ |
| Karnov Group | 225.0x | 4.8x | 31.51% | ★★★☆☆☆ |
| Seeing Machines | NA | 2.7x | 49.22% | ★★★☆☆☆ |
| Nyab | 25.7x | 1.1x | 25.95% | ★★☆☆☆☆ |
Let's take a closer look at a couple of our picks from the screened companies.
NCC Group (LSE:NCC)
Simply Wall St Value Rating: ★★★★☆☆
Overview: NCC Group is a global cybersecurity and risk mitigation company that provides services in cyber security and software escrow, with a market capitalization of approximately £0.54 billion.
Operations: The company's revenue primarily comes from the Cyber Security segment, contributing significantly more than Escode. Operating expenses, including general and administrative expenses, have been substantial, impacting net income margins negatively in recent periods. The gross profit margin has shown variability over time, with a recent figure of 41.69%.
PE: -30.4x
NCC Group, a smaller European company, has caught attention due to its potential for growth amidst current challenges. Their recent earnings report showed a net income increase to £16 million from £6.2 million the previous year, despite sales dipping to £156.8 million from £166.8 million. Insider confidence is evident with share purchases in 2025's first half, suggesting faith in future prospects. The company's focus on strategic client relationships hints at long-term stability and potential revenue growth despite short-term declines in Cyber Security revenues and reliance on external funding sources.
- Unlock comprehensive insights into our analysis of NCC Group stock in this valuation report.
Evaluate NCC Group's historical performance by accessing our past performance report.
Inwido (OM:INWI)
Simply Wall St Value Rating: ★★★★★★
Overview: Inwido is a leading European provider of windows and doors, operating across various segments including e-commerce and regional markets in Scandinavia, Eastern Europe, and Western Europe with a market capitalization of SEK 5.01 billion.
Operations: The company generates significant revenue from its key regions, with Scandinavia contributing the largest portion at SEK 4.31 billion, followed by Western Europe and Eastern Europe. E-Commerce also plays a notable role in its revenue model. The gross profit margin shows fluctuations, reaching a high of 28.32% in early 2017 before settling around 25-26% in recent periods. Operating expenses are primarily driven by sales and marketing efforts, which consistently account for a substantial part of the expenditure.
PE: 18.5x
Inwido, a player in Europe's small-cap landscape, showcases promising growth with earnings projected to rise 14.25% annually. Despite relying solely on external borrowing for funding, which carries higher risk, the company reported increased sales of SEK 2.3 billion and net income of SEK 155.9 million for Q2 2025 compared to the previous year. Insider confidence is evident with recent share purchases between January and July 2025, suggesting potential optimism about future performance despite a dividend decrease in May.
- Click to explore a detailed breakdown of our findings in Inwido's valuation report.
Understand Inwido's track record by examining our Past report.
Karnov Group (OM:KAR)
Simply Wall St Value Rating: ★★★☆☆☆
Overview: Karnov Group is a provider of legal and tax information services, operating primarily in the Nordic region with a market capitalization of SEK 4.5 billion.
Operations: The company generates revenue primarily from Region North and Region South, with recent figures showing SEK 1.25 billion and SEK 1.38 billion respectively. Its cost structure includes significant expenses in Cost of Goods Sold (COGS) and Operating Expenses, impacting its profitability metrics. Notably, the gross profit margin has shown variability, most recently recorded at 41.95% as of December 31, 2024.
PE: 225.0x
Karnov Group, a European small-cap company, showcases potential for growth despite some financial challenges. Their recent Q1 2025 earnings report reveals sales of SEK 672.5 million, up from SEK 631.7 million the previous year, with net income swinging to SEK 77.4 million from a loss of SEK 11.7 million. Earnings per share improved significantly to SEK 0.72 from a loss of SEK 0.11 last year, indicating strong operational performance and insider confidence through share purchases in early 2025 suggests optimism about future prospects amidst reliance on external borrowing for funding.
- Take a closer look at Karnov Group's potential here in our valuation report.
Explore historical data to track Karnov Group's performance over time in our Past section.
Turning Ideas Into Actions
- Take a closer look at our Undervalued European Small Caps With Insider Buying list of 49 companies by clicking here.
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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.
Valuation is complex, but we're here to simplify it.
Discover if Karnov Group might be undervalued or overvalued with our detailed analysis, featuring fair value estimates, potential risks, dividends, insider trades, and its financial condition.
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