The United Kingdom’s stock market has been under pressure recently, with the FTSE 100 and FTSE 250 indices both closing lower amid weak trade data from China, highlighting ongoing global economic uncertainties. Despite these challenges, discerning investors often look for opportunities in undervalued small-cap stocks that show potential for growth, especially those with insider buying as a positive indicator of confidence.

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

Click here to see the full list of 27 stocks from our Undervalued UK Small Caps With Insider Buying screener.

Let’s take a closer look at a couple of our picks from the screened companies.

Simply Wall St Value Rating: ★★★☆☆☆

Overview: Assura is a UK-based real estate investment trust specializing in the development and management of primary care properties, with a market cap of approximately £2.37 billion.

Operations: Assura’s primary revenue stream is from its core segment, generating £157.8 million. The company’s gross profit margin has shown a trend around 90.81% to 96.32%. Recent financials indicate net income margins have fluctuated significantly, with the latest being -18.25%. Operating expenses and non-operating expenses also play a crucial role in impacting overall profitability.

PE: -46.1x

Assura, a UK-based healthcare property developer, has demonstrated insider confidence with recent share purchases. They have forecasted earnings growth of 41.82% per year and announced a quarterly dividend of £0.0084 per share to be paid on 9 October 2024. Despite relying entirely on external borrowing for funding, Assura’s acquisition of a private hospital portfolio indicates strategic expansion in the healthcare sector. The company’s debt is not well covered by operating cash flow, highlighting potential financial risks.

Simply Wall St Value Rating: ★★★★★☆

Overview: Domino’s Pizza Group operates as a leading pizza delivery and carryout company, managing franchisee sales, corporate stores, advertising and ecommerce income, rental income from properties, and various franchise fees with a market cap of approximately £1.50 billion.

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Operations: Domino’s Pizza Group generates revenue primarily from sales to franchisees, corporate store income, national advertising and ecommerce income, rental income on properties, and various franchise fees. The company’s gross profit margin has shown an upward trend over the periods provided, reaching 47.48% as of June 2024.

PE: 15.5x

Domino’s Pizza Group, a UK-based company, has shown insider confidence with significant share repurchases in 2024. They bought back 1.77 million shares for £6.2 million between January and May and completed the repurchase of 25.3 million shares for £90.1 million under a previous buyback program. Despite a drop in net income to £42.3 million from £80.2 million year-over-year, the company remains optimistic about growth in order count and sales for fiscal year 2024 while maintaining strategic initiatives amidst market uncertainties.

Simply Wall St Value Rating: ★★★☆☆☆

Overview: Norcros is a company that specializes in building products, with operations generating £392.10 million in revenue.

Operations: Norcros generates revenue primarily from its Building Products segment, which reported £392.1 million. The company has experienced varying net income margins, with the most recent being 6.83% as of March 31, 2024. Operating expenses have shown fluctuations but were £349.40 million in the latest period ending September 3, 2024.

PE: 7.8x

Norcros, a UK-based company, has seen insider confidence with recent share purchases by executives in the last quarter. Despite reporting a 5.9% drop in revenue for the 13-week period ending June 2024 due to strategic exits, their net income rose to £26.8 million from £16.8 million year-over-year. The company declared a final dividend of 6.8 pence per share for FY2024, maintaining its total annual dividend at 10.2 pence per share, reflecting stable shareholder returns amidst market challenges.

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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.

Companies discussed in this article include LSE:AGR LSE:DOM and LSE:NXR.

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