Over the last 7 days, the market has dropped 5.7%. In the last year, the market is up 14%, and earnings are expected to grow by 15% per annum over the next few years. In this fluctuating environment, identifying stocks that are undervalued yet show promising insider activity can be a strategic approach for investors seeking potential growth opportunities.

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

Click here to see the full list of 65 stocks from our Undervalued US Small Caps With Insider Buying screener.

Underneath we present a selection of stocks filtered out by our screen.

Amarin

Simply Wall St Value Rating: ★★★☆☆☆

Overview: Amarin focuses on the development and commercialization of its primary product, Vascepa, with a market cap of approximately $0.85 billion.

Operations: The primary revenue stream is derived from the development and commercialization of Vascepa, with recent quarterly revenue at $264.78 million. The company's gross profit margin was 61.29%, reflecting a gross profit of $162.29 million against COGS of $102.49 million for the same period. Operating expenses were significant at $189.07 million, contributing to a net income loss of -$33.52 million and a net income margin of -12.66%.

PE: -8.0x

Amarin's recent Q2 2024 earnings showed a revenue drop to US$67.49 million from US$80.17 million the previous year, but it swung to a net income of US$1.52 million from a loss of US$17.56 million, indicating potential operational improvements despite declining sales. Insider confidence is evident with significant share purchases in the past six months, reflecting optimism about future prospects. The approval for VAZKEPA® reimbursement in Portugal and Greece could bolster European revenues amidst ongoing Nasdaq listing challenges due to low share prices.

• Dive into the specifics of Amarin here with our thorough valuation report.

• Review our historical performance report to gain insights into Amarin's's past performance.

AMERISAFE

Simply Wall St Value Rating: ★★★☆☆☆

Overview: AMERISAFE specializes in providing workers' compensation insurance, with a market cap of approximately $1.03 billion.

Operations: The company generates revenue primarily from Workers’ Compensation Insurance, with recent quarterly revenue of $309.13 million. For the latest quarter ending June 30, 2024, the gross profit margin was 32.46%, and net income margin stood at 18.46%. Operating expenses for this period were $29.58 million while non-operating expenses were $13.70 million.

PE: 15.7x

AMERISAFE, Inc., a smaller U.S. company, reported Q2 2024 revenue of US$75.83 million, slightly up from US$75.66 million the previous year, but net income dropped to US$10.99 million from US$15.63 million. Basic earnings per share fell to US$0.58 from US$0.82 a year ago due to higher risk funding and expected future earnings declines averaging 22% annually over three years. Insider confidence is evident with recent share repurchases totaling 91,825 shares for $4.1 million between April and June 2024.

• Click to explore a detailed breakdown of our findings in AMERISAFE's valuation report.

• Understand AMERISAFE's track record by examining our Past report.

Chimera Investment

Simply Wall St Value Rating: ★★★☆☆☆

Overview: Chimera Investment is a company that invests in a diversified portfolio of mortgage assets on a leveraged basis, with a market cap of approximately $1.51 billion.

Operations: Chimera Investment generates revenue primarily from its leveraged investments in a diversified portfolio of mortgage assets. The company's net income margin has shown significant fluctuations, with recent periods reflecting both positive and negative margins. Operating expenses have generally ranged between $33 million and $73 million, impacting the overall profitability.

PE: 9.4x

Chimera Investment recently declared multiple preferred dividends, including $0.50 per share for Series A and $0.7111 for Series B, payable on September 30, 2024. Despite a reverse stock split in May and a fixed-income offering of US$65 million at 9% interest due in 2029, the company faces forecasted earnings decline of 3.9% annually over the next three years. Insider confidence is evident with significant insider buying activity throughout Q2 2024, reflecting potential optimism about future prospects despite challenges like debt coverage concerns and past shareholder dilution.

• Click here to discover the nuances of Chimera Investment with our detailed analytical valuation report.

• Explore historical data to track Chimera Investment's performance over time in our Past section.

Summing It All Up

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• Find companies with promising cash flow potential yet trading below their fair value.

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 NasdaqGM:AMRN NasdaqGS:AMSF and NYSE:CIM.

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