Over the last 7 days, the market has dropped 2.7%, yet it remains up 21% over the past year, with earnings expected to grow by 15% per annum over the next few years. In this dynamic environment, identifying undervalued small-cap stocks with insider buying can offer potential opportunities for investors looking to capitalize on market inefficiencies and insider confidence.
Top 10 Undervalued Small Caps With Insider Buying In The United States
Overview: Advantage Solutions provides sales and marketing services to consumer goods manufacturers and retailers, with a market cap of approximately $1.37 billion.
Operations: Advantage Solutions generates revenue primarily through sales, with significant costs attributed to COGS and operating expenses. Over recent periods, the company has seen fluctuations in its gross profit margin, with a notable decrease to 12.78% as of June 30, 2023. Net income margins have varied widely, reflecting both positive and negative values across different quarters.
PE: -7.1x
Advantage Solutions, a U.S. provider of sales and omnichannel marketing solutions, recently unveiled a new brand identity to reflect its unified retail focus. Despite reporting a net loss of US$100.84 million for Q2 2024, the company repurchased 6 million shares from April to July 2024, showing insider confidence in its future potential. Additionally, Advantage's strategic alliances and restructured operations aim to enhance efficiency and growth prospects in the consumer goods sector.
Overview: Capital Southwest is a business development company that provides capital to middle-market companies, with a market cap of approximately $0.57 billion.
Operations: Capital Southwest generates revenue primarily from investments, reaching $189.13 million recently. The company incurs operating expenses totaling $26.04 million and non-operating expenses of $89.47 million, resulting in a net income margin of 38.92%.
PE: 16.1x
Capital Southwest, a small cap in the U.S., recently presented at the Midwest IDEAS Investor Conference on August 29, 2024. Despite a drop in net income to US$14.04 million from US$23.81 million year-over-year for Q1 2024, revenue increased to US$51.35 million from US$40.36 million. The company declared both regular and supplemental dividends totaling $0.64 per share payable on September 30, 2024. Insider confidence is evident with insider purchases over the past six months bolstering investor sentiment further.
Overview: Industrial Logistics Properties Trust focuses on owning and leasing industrial and logistics properties, with a market cap of approximately $0.63 billion.
Operations: ILPT's primary revenue stream is from the ownership and leasing of properties, generating $441.89 million in revenue. The gross profit margin has ranged between 78.49% to 88.76%, with a recent value of 86.47%. Operating expenses and non-operating expenses significantly impact net income, resulting in a net income margin that has fluctuated widely, reaching as low as -58.44% recently.
PE: -3.1x
Industrial Logistics Properties Trust, a small-cap stock, reported Q2 2024 sales of US$110.62 million with a net loss of US$23.18 million, showing slight improvement from the previous year. Despite reliance on external borrowing for funding and interest payments not fully covered by earnings, insider confidence is evident with significant share purchases in the past six months. Additionally, ILPT was recently added to multiple Russell indexes on July 1st, indicating potential recognition in broader investment circles.
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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.
