The Canadian market has experienced a recent dip, with the TSX down about 3% amid broader economic uncertainties and interest rate adjustments. In this environment, identifying undervalued small-cap stocks with insider buying can offer intriguing opportunities for investors looking to capitalize on potential market rebounds.
Top 10 Undervalued Small Caps With Insider Buying In Canada
Overview: Flagship Communities Real Estate Investment Trust operates in the residential REIT sector with a focus on manufactured housing communities, and has a market cap of approximately C$0.38 billion.
Operations: Flagship Communities Real Estate Investment Trust generates revenue primarily from its residential real estate investments, with recent quarterly revenue reaching $78.07 million. The company's gross profit margin has shown a range between 63.89% and 66.82%, indicating the efficiency of its core operations relative to cost of goods sold (COGS).
PE: 3.6x
Flagship Communities Real Estate Investment Trust, a smaller Canadian stock, has shown promising insider confidence with recent share purchases. Despite earnings forecasted to decline by 46.1% annually over the next three years, revenue is expected to grow by 8.9% per year. For Q2 2024, Flagship reported USD 21.23 million in sales and USD 43.46 million in net income, doubling from last year’s figures. The company consistently offers a monthly cash distribution of USD 0.0492 per REIT unit.
Overview: Nexus Industrial REIT is a Canadian real estate investment trust that focuses on owning and managing industrial properties, with a market cap of approximately CA$1.02 billion.
Operations: Nexus Industrial REIT generates revenue primarily from investment properties, with a recent quarterly revenue of CA$167.21 million and a gross profit margin of 71.56%. The company incurs costs of goods sold (COGS) amounting to CA$47.55 million and operating expenses totaling CA$8.65 million, resulting in a net income margin of 99.45%.
PE: 3.6x
Nexus Industrial REIT, a smaller player in the Canadian market, recently declared distributions of C$0.05333 per unit for September and October 2024. Despite reporting increased sales of C$43.91 million for Q2 2024 compared to C$38.42 million last year, net income fell to C$43.53 million from C$77.22 million due to one-off items impacting results. Insider confidence is evident as key individuals have been purchasing shares throughout the past year, signaling potential future growth despite forecasts predicting a decline in earnings over the next three years by an average of 46.2%.
Overview: Rogers Sugar operates in the production and distribution of sugar and maple products, with a market cap of approximately CA$0.54 billion.
Operations: Rogers Sugar generates revenue primarily from its Sugar and Maple Products segments, with recent revenues of CA$1.21 billion. The company's gross profit margin has varied, reaching 21.42% in July 2016 and recently recorded at 13.87% in June 2024.
PE: 15.3x
Rogers Sugar, a key player in Canada's sugar industry, reported CAD 309.09 million in Q3 sales for 2024, up from CAD 262.29 million the previous year, though net income dropped to CAD 7.38 million from CAD 14.18 million. Despite external borrowing risks and shareholder dilution over the past year, insider confidence is evident with recent share purchases by executives in July and August 2024. The company declared a quarterly dividend of $0.09 per share on August 8, signaling steady returns for investors amidst fluctuating earnings.
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:MHC.UN TSX:NXR.UN and TSX:RSI.
Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email [email protected]