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Exploring Three Undervalued Small Caps With Insider Action In The United Kingdom

Amidst a backdrop where the FTSE 100 is poised to break a three-month winning streak and broader market indices show mixed signals, investors are navigating through an environment filled with both caution and opportunity. In such a landscape, identifying undervalued small-cap stocks with insider buying can be particularly compelling, as these actions may signal unrecognized value or upcoming positive developments within these companies.

Top 10 Undervalued Small Caps With Insider Buying In The United Kingdom

Name

PE

PS

Discount to Fair Value

Value Rating

Norcros

7.5x

0.5x

43.15%

★★★★★☆

John Wood Group

NA

0.3x

49.07%

★★★★★☆

THG

NA

0.4x

33.18%

★★★★★☆

Bytes Technology Group

28.7x

6.5x

12.37%

★★★★☆☆

CVS Group

20.5x

1.1x

41.88%

★★★★☆☆

M&C Saatchi

NA

0.5x

49.15%

★★★★☆☆

Savills

36.4x

0.7x

25.21%

★★★☆☆☆

Robert Walters

20.6x

0.3x

35.50%

★★★☆☆☆

J D Wetherspoon

21.4x

0.4x

-63.93%

★★★☆☆☆

Hochschild Mining

NA

1.6x

38.95%

★★★☆☆☆

Click here to see the full list of 36 stocks from our Undervalued Small Caps With Insider Buying screener.

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Here's a peek at a few of the choices from the screener.

M&C Saatchi

Simply Wall St Value Rating: ★★★★☆☆

Overview: M&C Saatchi is a global advertising and marketing services company with a market capitalization of approximately £76 million.

Operations: The company has experienced fluctuations in gross profit margin over the observed periods, ranging from a high of 73.22% to a low of -30.69%. In recent entries, the gross profit margin was recorded at 15.87%, reflecting variability in its cost management and revenue generation efficiency.

PE: -70.0x

With a strategic shift in executive roles and a recent dividend increase, M&C Saatchi demonstrates operational dynamism amid challenging financials, reporting a net loss despite robust sales of £453.91 million last year. Insider confidence is evident as they recently purchased shares, signaling belief in the company's recovery and growth prospects. This activity, coupled with forecasted earnings growth of 43.75% annually, positions M&C Saatchi as an intriguing entity within the undervalued UK market sector.

AIM:SAA Share price vs Value as at Jun 2024
AIM:SAA Share price vs Value as at Jun 2024

Assura

Simply Wall St Value Rating: ★★★★☆☆

Overview: Assura is a UK-based healthcare real estate investment trust (REIT) specializing in the development, investment, and management of primary care facilities across the United Kingdom.

Operations: The entity generates revenue primarily through its core operations, with a recent figure reported at £157.8 million. It has demonstrated a consistent gross profit margin averaging approximately 92% over the last few reporting periods, reflecting efficient cost management relative to its revenue generation.

PE: -41.5x

Assura, a UK-based healthcare property investor, reported a significant reduction in net loss to GBP 28.8 million for the year ended March 2024, down from GBP 119.2 million previously. This improvement accompanies their strategic GBP 250 million joint venture aimed at enhancing NHS infrastructure, signaling robust growth prospects and financial health. Recently, insiders demonstrated confidence in Assura's trajectory through share purchases, underscoring their belief in the company’s potential despite its reliance on higher-risk funding sources like external borrowing.

LSE:AGR Share price vs Value as at Jun 2024
LSE:AGR Share price vs Value as at Jun 2024

SSP Group

Simply Wall St Value Rating: ★★★★★☆

Overview: SSP Group operates primarily in the food and beverage sector, focusing on travel locations such as airports and railway stations, with a market capitalization of approximately £2.10 billion.

Operations: The entity generates a significant portion of its revenue from the food and beverage sector, primarily located in travel environments such as airports and railway stations, with recent figures showing £3.21 billion. Over time, the gross profit margin has shown an upward trend, increasing from 19.57% to approximately 28.84%, indicating an improvement in cost management relative to sales.

PE: 158.6x

Despite a challenging financial landscape with a slight net loss increase, SSP Group recently declared an interim dividend, signaling potential stability. Sales have notably risen to £1,517.2 million from £1,318.4 million year-over-year. Insider confidence is evident as they recently purchased shares, underscoring their belief in the company's prospects amidst forecasts of a significant 50.77% annual earnings growth and concerns over interest coverage by earnings. This blend of insider activity and dividend adjustments paints a complex yet intriguing picture for SSP Group in the undervalued sector.

LSE:SSPG Share price vs Value as at Jun 2024
LSE:SSPG Share price vs Value as at Jun 2024

Where To Now?

Searching for a Fresh Perspective?

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.

Companies discussed in this article include AIM:SAA LSE:AGR and LSE:SSPG.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com