Investigate three undervalued British small caps with insider buying signals

Amid fluctuating global markets, with the FTSE 100 showing muted activity and broader economic indicators pointing to mixed sentiments, investors are keeping a close eye on shifts that could impact investment opportunities, especially in small-cap stocks. In such a landscape, identifying undervalued small caps with insider buying signals can provide potential opportunities for those looking to diversify their portfolios in line with current market dynamics.

Top 10 undervalued small caps with insider buying in the UK

Name P.E P.S Discount to fair value Value assessment
Kenmare Resources 3.1x 0.9x 48.99% ★★★★★☆
Fast rental AFTER 0.3x 35.24% ★★★★★☆
THG AFTER 0.5x 31.01% ★★★★★☆
Ultimate products 10.7x 0.8x 8.20% ★★★★☆☆
Bodycote 16.4x 1.8x 12.79% ★★★★☆☆
Morgan advanced materials 19.3x 0.8x 46.65% ★★★★☆☆
Eurocel 15.0x 0.4x 22.42% ★★★★☆☆
M&C Saatchi AFTER 0.6x 48.16% ★★★★☆☆
Luceco 16.7x 1.3x 16.93% ★★★☆☆☆
Robert Walters 20.5x 0.3x 47.56% ★★★☆☆☆

Click here to see the full list of 32 stocks from our screener for undervalued small caps with insider buying.

Here’s a preview of some of the choices from the screener.

Simply Wall St value rating: ★★★☆☆☆

Overview: Assura is a real estate investment trust (REIT) specializing in the ownership, management and development of primary care facilities in the United Kingdom, with a market capitalization of approximately £1.76 billion.

Activities: The core segment generated £157.8 million in revenue, with a gross profit margin of 90.81% and a net profit margin declining to -18.25%.

P.E.: -44.0x

Assura, a specialist in healthcare real estate investments, has recently partnered with Universities Superannuation Scheme in a £250m venture aimed at improving NHS infrastructure, reflecting robust strategic growth and diversification. Despite a challenging year with a net loss of GBP 28.8 million, the company’s turnover increased to GBP 157.8 million, compared to GBP 150.4 million previously. This financial resilience is underlined by their commitment to reinvest the proceeds from this deal in further acquisitions and developments within the healthcare sector, indicating strong future prospects amid an aging population and increasing demand for healthcare.

LSE:AGR share price versus value as of June 2024

Simply Wall St value rating: ★★★★☆☆

Overview: Aston Martin Lagonda Global Holdings is a luxury car manufacturer known for its high-quality vehicles, with a market capitalization of approximately £1.23 billion.

Activities: The Automotive segment generated £1.60 billion in revenue, with a gross profit margin of 39.70%.

P.E.: -4.2x

Amid the challenges, Aston Martin Lagonda’s recent management reshuffles and projected earnings growth of 83% per year signal a strategic turnaround. Despite a decline in first quarter sales to £268 million and an increased net loss of £139 million, the company’s leadership changes, including the appointment of Adrian Hallmark as CEO by October 2024, underline a revitalization effort. This new direction is further confirmed by insider confidence, with significant share purchases indicating optimism for the restructured future.

LSE:AML share price versus value as of June 2024

Simply Wall St value rating: ★★★★☆☆

Overview: Bodycote is a global provider of heat treatment and specialist thermal processing services, primarily serving the aerospace, defence, energy and automotive industries with a market capitalization of approximately £1.39 billion.

Activities: The company’s turnover has grown from £603m to £802.5m in the latest period, with the latest gross profit margin reported at 13.47%. Key revenue contributors include the aerospace, defense and energy sectors in North America and Western Europe, and the automotive and general industrial sectors in several regions.

P.E.: 16.4x

Bodycote, a lesser-known British entity, has recently boosted investor confidence through insider acquisitions and a robust share buyback program, setting aside up to £60 million for buybacks. With a solid performance in 2023, turnover of £802.5m and net profit up to £85.6m on last year’s figures, they show promising financial health. The appointment of Jim Fairbairn as the new CEO could signal strategic shifts or continuity in growth trajectories. Their commitment to shareholder returns is further demonstrated by an increased dividend payment for June 2024.

LSE:BOY share price versus value as of June 2024

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This article from Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts using only an unbiased methodology and our articles are not intended as financial advice. It is not a recommendation to buy or sell any stock and does not take into account your objectives or financial situation. We aim to provide you with targeted, long-term analysis based on fundamental data. Please note that our analysis may not take into account the latest price-sensitive company announcements or quality material. Simply Wall St has no positions in the stocks mentioned.

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