In This Article:
In the past year, the Australian market has demonstrated resilience with a 6.5% increase, despite a recent 1.4% dip over the last seven days. In such an environment, undervalued small-cap stocks like Codan that exhibit insider buying activity can present intriguing opportunities for investors looking to capitalize on potential growth prospects forecasted at 13% annually.
Top 10 Undervalued Small Caps With Insider Buying In Australia
| Name | PE | PS | Discount to Fair Value | Value Rating |
|---|---|---|---|---|
| Corporate Travel Management | 17.6x | 2.7x | 47.32% | ★★★★★★ |
| Nick Scali | 13.7x | 2.5x | 45.68% | ★★★★★★ |
| RAM Essential Services Property Fund | NA | 5.6x | 41.70% | ★★★★★☆ |
| Healius | NA | 0.6x | 43.68% | ★★★★★☆ |
| Dicker Data | 20.7x | 0.8x | 3.94% | ★★★★☆☆ |
| Eagers Automotive | 9.5x | 0.3x | 34.15% | ★★★★☆☆ |
| Codan | 28.7x | 4.2x | 27.05% | ★★★★☆☆ |
| Elders | 20.3x | 0.4x | 49.88% | ★★★★☆☆ |
| Tabcorp Holdings | NA | 0.6x | 21.65% | ★★★★☆☆ |
| Coventry Group | 283.1x | 0.4x | -17.24% | ★★★☆☆☆ |
Let's take a closer look at a couple of our picks from the screened companies.
Codan
Simply Wall St Value Rating: ★★★★☆☆
Overview: Codan is a diversified technology company specializing in communications equipment and metal detection, with a market capitalization of approximately A$1.02 billion.
Operations: Communications and Metal Detection are the primary revenue contributors, generating A$291.50 million and A$212.20 million respectively. The company has experienced a gross profit margin of approximately 54.42% as of the latest reporting period in 2024.
PE: 28.7x
Recently, insiders at Codan have shown their belief in the company's potential through share purchases, signaling insider confidence. This action aligns with projections that forecast a 16% annual growth in earnings. Despite relying solely on external borrowing—a higher risk funding method—Codan remains a compelling prospect within the undervalued Australian market sector, suggesting both challenges and opportunities ahead. This blend of financial health and insider activity makes it an interesting consideration for those eyeing hidden gems in the market.
Lifestyle Communities
Simply Wall St Value Rating: ★★★☆☆☆
Overview: Lifestyle Communities is a company engaged in property development and management, with a market capitalization of approximately A$1.20 billion.
Operations: The company generates revenue primarily through property development and management, evidenced by a recent figure of A$239.11 million. Over the years, it has demonstrated a fluctuating gross profit margin, with the most recent being 21.02%.