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The United Kingdom's stock market has faced recent turbulence, with the FTSE 100 closing lower due to weak trade data from China and broader global economic concerns. Despite these challenges, opportunities still exist within the small-cap sector for discerning investors. In this article, we will explore three undervalued small-cap stocks in the UK that have shown insider buying activity, suggesting potential confidence from those closest to the companies.
Top 10 Undervalued Small Caps With Insider Buying In The United Kingdom
| Name | PE | PS | Discount to Fair Value | Value Rating |
|---|---|---|---|---|
| Bytes Technology Group | 24.0x | 5.4x | 14.54% | ★★★★★☆ |
| Domino's Pizza Group | 15.1x | 1.7x | 29.10% | ★★★★★☆ |
| C&C Group | NA | 0.4x | 47.89% | ★★★★★☆ |
| GB Group | NA | 3.0x | 33.33% | ★★★★★☆ |
| Norcros | 7.6x | 0.5x | 1.99% | ★★★★☆☆ |
| Harworth Group | 14.2x | 7.4x | -516.55% | ★★★★☆☆ |
| CVS Group | 21.6x | 1.2x | 42.88% | ★★★★☆☆ |
| Hochschild Mining | NA | 1.6x | 45.52% | ★★★★☆☆ |
| H&T Group | 8.1x | 0.8x | -3.04% | ★★★☆☆☆ |
| Foxtons Group | 27.2x | 1.3x | 43.89% | ★★★☆☆☆ |
Let's dive into some prime choices out of from the screener.
GB Group
Simply Wall St Value Rating: ★★★★★☆
Overview: GB Group specializes in identity data intelligence solutions, with a market capitalization of approximately £1.10 billion.
Operations: The company generates revenue primarily from Fraud (£40.20 million), Identity (£156.06 million), and Location (£81.07 million) segments, with a gross profit margin of 70.14%. Operating expenses are significant, driven largely by General & Administrative costs and R&D expenses, impacting net income margins which have shown negative trends in recent periods, reaching -17.52% as of March 31, 2024.
PE: -17.3x
GB Group, a smaller UK-listed company, has shown promising growth potential with earnings forecasted to grow 92.89% annually. At the AGM on July 23, 2024, they declared a final dividend of £0.042 per share. Despite reporting a net loss of £48.58 million for FY24, this was an improvement from the previous year's loss of £119.79 million. The company expects mid-single-digit revenue growth and high single-digit profit growth in FY25 due to operational efficiencies achieved in FY24.
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Click to explore a detailed breakdown of our findings in GB Group's valuation report.
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Understand GB Group's track record by examining our Past report.
Just Group
Simply Wall St Value Rating: ★★★★☆☆
Overview: Just Group is a financial services company specializing in retirement products and services, with a market cap of approximately £1.67 billion.
Operations: Just Group generates revenue primarily from its core business operations, with significant cost components including cost of goods sold (COGS) and operating expenses. Over recent periods, the company has experienced fluctuations in its net income margin, reaching a high of 11.62% in Q2 2020 and a low of -25.37% in Q4 2022. The gross profit margin showed notable improvement from -14.75% in Q1 2023 to 54.28% by the end of that year.