Over the last 7 days, the United States market has risen 3.1%, and in the past year, it has climbed 25%. With earnings forecast to grow by 15% annually, identifying undervalued small-cap stocks with insider action can present compelling opportunities for investors looking to capitalize on these favorable market conditions.

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

Click here to see the full list of 66 stocks from our Undervalued US Small Caps With Insider Buying screener.

Let's uncover some gems from our specialized screener.

Distribution Solutions Group

Simply Wall St Value Rating: ★★★☆☆☆

Overview: Distribution Solutions Group operates in the distribution sector, providing a range of products and services through its segments Lawson, Testequity, and Gexpro Services, with a market cap of approximately $1.5 billion.

Operations: Distribution Solutions Group generates revenue primarily from Lawson ($463.59 million), TestEquity ($782.97 million), and Gexpro Services ($402.23 million). The company experienced fluctuations in its net income margin, with a notable increase to 0.01682% in Q2 2023 before dropping to -0.01249% by Q2 2024, while gross profit margin varied between 25.08% and 36.03%.

PE: -79.9x

Distribution Solutions Group (DSG) has been actively seeking acquisitions, with a strategic focus on driving long-term value. Despite a challenging Q2 2024, where net income dropped to US$1.9 million from US$3.02 million the previous year, DSG increased its borrowing capacity to US$1.06 billion and repurchased shares worth US$1.68 million between April and June 2024, reflecting insider confidence in their growth strategy. Earnings are projected to grow at an impressive rate of 90.85% annually.

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

• Gain insights into Distribution Solutions Group's historical performance by reviewing our past performance report.

MaxLinear

Simply Wall St Value Rating: ★★★★☆☆

Overview: MaxLinear is a company that designs and supplies semiconductor solutions for broadband communications, data center, metro, and long-haul transport network applications with a market cap of approximately $2.56 billion.

Operations: MaxLinear generates revenue primarily from its semiconductor segment, with notable operating expenses in R&D and general & administrative areas. The company has experienced fluctuations in net income margin, reaching -42.38% as of June 30, 2024. Gross profit margin stood at 53.99% for the same period.

PE: -5.7x

MaxLinear, a small company in the semiconductor industry, has recently seen insider confidence with Kishore Seendripu purchasing 108,303 shares valued at approximately US$1.4 million. Despite a volatile share price and past shareholder dilution, the company forecasts an impressive 82.84% annual earnings growth. MaxLinear's Panther III storage accelerator demonstrates significant cost and performance advantages in data storage systems by reducing CPU core usage and enhancing effective storage capacity. Recent presentations at major conferences highlight its innovative edge in a rapidly expanding market driven by AI advancements.

• Take a closer look at MaxLinear's potential here in our valuation report.

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

Federal Agricultural Mortgage

Simply Wall St Value Rating: ★★★☆☆☆

Overview: Federal Agricultural Mortgage provides financing solutions for agricultural and rural infrastructure sectors, with a market cap of approximately $1.17 billion.

Operations: The company generates revenue through segments such as Treasury Funding ($130.52M), Farm & Ranch Agricultural Finance ($151.84M), and Corporate Agfinance ($31.17M). Net income margin has shown variability, with recent figures around 50.10% in Q1 2024 and 50.09% in Q2 2024, reflecting the proportion of net income to total revenue after operating expenses are accounted for.

PE: 11.5x

Federal Agricultural Mortgage (Farmer Mac) recently reported second-quarter net income of US$47.11 million, nearly matching last year's US$47.21 million, with basic earnings per share at US$3.71. Over six months, net income rose to US$100.85 million from US$94.25 million previously, indicating steady financial performance despite external borrowing risks. The board declared a third-quarter dividend of $1.40 per common share and announced preferred dividends payable in October 2024, reflecting consistent shareholder returns amidst a strong workplace culture shift with their new headquarters in Washington D.C.

• Navigate through the intricacies of Federal Agricultural Mortgage with our comprehensive valuation report here.

• Gain insights into Federal Agricultural Mortgage's past trends and performance with our Past report.

Summing It All Up

• Delve into our full catalog of 66 Undervalued US Small Caps With Insider Buying here.

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Curious About Other Options?

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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 NasdaqGS:DSGR NasdaqGS:MXL and NYSE:AGM.

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