Over the last 7 days, the Canadian market has dropped 2.8%, though it is up 8.1% over the past year, with earnings forecasted to grow by 15% annually. In this context, identifying undervalued small-cap stocks with insider buying can be a strategic move for investors looking to capitalize on potential growth opportunities amidst fluctuating market conditions.

Top 10 Undervalued Small Caps With Insider Buying In Canada

Click here to see the full list of 30 stocks from our Undervalued TSX Small Caps With Insider Buying screener.

Below we spotlight a couple of our favorites from our exclusive screener.

Black Diamond Group

Simply Wall St Value Rating: ★★★★☆☆

Overview: Black Diamond Group provides workforce and modular space solutions, with a market cap of approximately CA$0.27 billion.

Operations: The company generates revenue from two primary segments: Workforce Solutions and Modular Space Solutions, with the latter bringing in CA$201.58 million. Over recent periods, the gross profit margin has shown an upward trend, reaching 46.04% as of June 30, 2024. Operating expenses and non-operating expenses have also been notable cost components impacting net income margins.

PE: 19.3x

Black Diamond Group, a small-cap Canadian company, reported Q2 2024 earnings with sales rising to C$95.47 million from C$91.14 million year-over-year and net income increasing to C$7.5 million from C$4.57 million. They declared a third-quarter dividend of C$0.03 per share payable in October 2024 and recently acquired 329 space rental units for $20.45 million, enhancing their Western Canadian Modular Space Solutions market presence amid strong demand. Insider confidence is evident with recent share purchases by executives in the past six months.

• Click here and access our complete valuation analysis report to understand the dynamics of Black Diamond Group.

• Explore historical data to track Black Diamond Group's performance over time in our Past section.

Dundee Precious Metals

Simply Wall St Value Rating: ★★★★★★

Overview: Dundee Precious Metals is a mining company focused on gold and copper production with operations primarily at its Ada Tepe and Chelopech mines, and it has a market cap of approximately $1.50 billion CAD.

Operations: Dundee Precious Metals generates revenue primarily from its Ada Tepe and Chelopech segments, with recent quarterly revenues reaching up to $541.83 million. The company's cost of goods sold (COGS) has ranged between $176.67 million and $364.62 million over the past periods, contributing to a gross profit margin that peaked at 56.96%.

PE: 7.9x

Dundee Precious Metals, a Canadian small-cap, has seen insider confidence with notable share purchases in the past six months. Despite earnings forecasted to decline by 7.2% annually over the next three years, Q2 2024 results showed sales of US$156.84 million and net income of US$62.42 million, both up from last year. The company declared a third-quarter dividend of US$0.04 per share and provided solid production guidance for gold and copper through 2024.

• Delve into the full analysis valuation report here for a deeper understanding of Dundee Precious Metals.

• Review our historical performance report to gain insights into Dundee Precious Metals''s past performance.

NFI Group

Simply Wall St Value Rating: ★★★★★☆

Overview: NFI Group is a leading manufacturer of buses and motor coaches, with significant operations in both aftermarket services and manufacturing, and has a market cap of approximately C$1.20 billion.

Operations: The company generates revenue primarily from Aftermarket Operations ($599.83 million) and Manufacturing Operations ($2.47 billion). Gross profit margin has varied, reaching a peak of 18.98% in late 2017 but declining to around 9.99% by mid-2024.

PE: -33.9x

NFI Group has recently shown a significant turnaround, reporting Q2 2024 sales of US$851.23 million, up from US$660.29 million a year ago, and achieving a net income of US$2.55 million compared to last year's net loss of US$48.1 million. This growth is complemented by insider confidence as Non-Executive Vice Chairman Colin Robertson purchased 50,000 shares for approximately A$582,375 in June 2024, indicating strong belief in the company's future prospects. Additionally, NFI secured new orders for zero-emission buses and was added to multiple S&P/TSX indices this summer, signaling broader market recognition and potential for further growth in sustainable mass mobility solutions.

• Click here to discover the nuances of NFI Group with our detailed analytical valuation report.

• Assess NFI Group's past performance with our detailed historical performance reports.

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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 TSX:BDI TSX:DPM and TSX:NFI.

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