The Canadian market has experienced increased volatility recently, driven by concerns over a slowing economy and persistent inflation, yet broader indices remain near record highs. In this climate of fluctuating sentiment, identifying undervalued small-cap stocks with recent insider activity can offer unique opportunities for investors seeking value amidst the turbulence.
Top 10 Undervalued Small Caps With Insider Buying In Canada
Overview: Chemtrade Logistics Income Fund operates in the chemical industry, providing industrial chemicals and services with a market cap of approximately CA$0.86 billion.
Operations: Chemtrade Logistics Income Fund generates revenue primarily from its EC and SWC segments, totaling CA$1.78 billion as of the latest period. The company has experienced fluctuations in its net income margin, with recent figures showing a net income margin of 0.078%. Gross profit margins have varied, reaching 23.63% in the most recent quarter. Operating expenses and non-operating expenses also impact overall profitability significantly.
PE: 8.6x
Chemtrade Logistics Income Fund, a small-cap in Canada, recently reported Q2 2024 sales of C$448.1 million and net income of C$14.6 million, down from C$469.97 million and C$87.33 million respectively a year ago. Despite high debt levels and declining earnings forecasts, insider confidence is evident with recent share repurchases amounting to 546,700 shares for C$5.08 million between May and August 2024. The company also declared consistent monthly cash distributions of $0.055 per unit through September 2024.
Overview: NorthWest Healthcare Properties Real Estate Investment Trust operates in the healthcare real estate industry with a market cap of approximately CA$2.80 billion.
Operations: Revenue primarily comes from the healthcare real estate industry, with gross profit margins ranging between 69.89% and 94.83%. Operating expenses include general and administrative costs, which have varied from CA$2.88 million to CA$55.60 million over the periods analyzed. Net income margins have shown significant fluctuations, reaching as high as 108.33% and dropping to -75.29%.
PE: -3.4x
NorthWest Healthcare Properties Real Estate Investment Trust, a smaller Canadian stock, has seen significant insider confidence with Peter Aghar purchasing 100,000 shares worth approximately C$477,861. Despite reporting a net loss of C$122.34 million in Q2 2024 and lower sales compared to the previous year, the REIT continues to declare consistent monthly distributions of C$0.03 per unit. Earnings are forecasted to grow by 117.9% annually, suggesting potential for future value despite current financial challenges.
Overview: Vermilion Energy is a company engaged in the exploration and production of oil and gas, with operations generating CA$1.81 billion.
Operations: Vermilion Energy's primary revenue stream is from its oil and gas exploration and production segment, with recent quarterly revenue at CA$1.81 billion. The company's gross profit margin has varied, reaching 82.55% in Q3 2022 but declining to 65.72% by Q2 2024.
PE: -2.4x
Vermilion Energy, a Canadian small-cap stock, has shown promising signs of being undervalued. Despite reporting a net loss of C$82.43 million for Q2 2024, the company is making strategic moves to enhance its future prospects. Notably, it completed testing on its first deep gas exploration well in Germany with encouraging results and has commenced drilling a second well. Additionally, insider confidence is evident with recent share repurchases totaling 3.7 million shares between April and July 2024 for C$59.8 million.
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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:CHE.UN TSX:NWH.UN and TSX:VET.
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