The United Kingdom’s market landscape has been experiencing some turbulence, with the FTSE 100 and FTSE 250 indices closing lower amid concerns over weak trade data from China, which is affecting global economic sentiment. As major economies grapple with these challenges, small-cap stocks in the UK may present unique opportunities for investors seeking potential growth at a time when larger companies are facing headwinds. In this context, identifying small-cap stocks that show signs of being undervalued can be particularly appealing, especially when there is evidence of insider buying indicating confidence from those closest to the business operations.
Name
PE
PS
Discount to Fair Value
Value Rating
Senior
17.7x
0.5x
38.38%
★★★★★★
Bytes Technology Group
22.4x
5.7x
10.74%
★★★★★☆
NWF Group
8.1x
0.1x
39.05%
★★★★★☆
John Wood Group
NA
0.2x
36.79%
★★★★★☆
Genus
167.5x
2.0x
10.09%
★★★★★☆
Essentra
728.4x
1.4x
26.33%
★★★★☆☆
Marlowe
NA
0.7x
42.25%
★★★★☆☆
Optima Health
NA
1.2x
39.64%
★★★★☆☆
Robert Walters
42.4x
0.2x
41.00%
★★★☆☆☆
Watkin Jones
NA
0.2x
-1404.25%
★★★☆☆☆
Let’s dive into some prime choices out of from the screener.
Simply Wall St Value Rating: ★★★☆☆☆
Overview: Vertu Motors operates as a retailer in the automotive sector, focusing on gasoline and auto dealerships, with a market capitalization of approximately £0.23 billion.
Operations: The company generates revenue primarily from its retail gasoline and auto dealership operations, with recent figures showing a revenue of £4.79 billion. Its gross profit margin has shown some variability, with the latest figure at 10.91%. Over time, cost of goods sold (COGS) has been a significant expense component, aligning closely with revenue growth trends. Operating expenses and non-operating expenses also contribute to the financial structure, impacting net income margins which have recently been around 0.40%.
PE: 11.2x
Vertu Motors, a small UK player, shows potential despite challenges. With a recent share buyback of 3.08 million shares for £2.23 million completed by August 2024, there’s some insider confidence in its future prospects. However, profit margins have narrowed to 0.4% from last year’s 0.6%, and net income dipped to £15.96 million for the half-year ending August 2024 compared to £22.42 million previously. Revenue is expected to grow by about 4% annually, though funding remains high-risk due to reliance on external borrowing rather than customer deposits or low-risk sources.
Story Continues
