In this article, we will take a detailed look at 10 Small–Cap Stocks Insiders Are Buying Recently. We previously covered 10 Large-Cap Stocks Insiders Are Buying Recently.
Why should we be interested in stocks with smaller market capitalizations? Small-cap stocks usually operate in other industries than large-cap companies, meaning they will help investors diversify their portfolios. Also, the share price of small-cap stocks is often lower, which makes them more affordable. Some small-cap investors focus on finding young companies with strong growth potential, which can lead to high returns once they transition to large-cap stocks. While small-cap stocks often carry higher risks and are more prone to market volatility, they also offer investors more room for growth.
How to pick good small-cap stocks to invest in currently? While there’s no single simple or complicated rule that investors can follow to achieve secure results, there are some strategies that can help. One strategy is to keep track of insider trading activity. Insiders or, in other words, people at high positions within companies, such as CEOs, CFOs, directors and other executives have unparalleled insights into the company’s strategic moves, plans, and initiatives. A CEO’s investment in a company’s stock can sometimes signal strong confidence in the company’s future.
Insider trading activity should be assessed within the broader context of the company’s fundamentals, industry trends and overall market conditions, because behind insider moves can be various other motives. Heavy insider trading activity doesn’t necessarily mean the company is poised for growth. That’s why due diligence is of utmost importance before making any investment. Investors should also take into account and meticulously analyze underlying reasons for insider transactions. However, insider trading activity in combination with other relevant factors can offer valuable insights into a company’s capabilities, helping investors make more informed investment decisions.
To come up with the 10 small-cap stocks insiders are buying recently, we only considered stocks with a market capitalization of between $250 million to $2 billion. We first used Insider Monkey’s insider trading screener and searched for stocks with at least two insiders buying shares in the last three months.
With each stock we note the number of recent insider purchases and the company’s current market capitalization. But why is it important to follow insider activity? Our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds, focusing on insider trading and stock picks from hedge fund investor newsletters and conferences. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 275% since May 2014, beating its benchmark by 150 percentage points (see more details here)
A close up of a trader on a trading floor busily pushing buttons.
10. CION Investment Corporation (NYSE:CION)
Number of Insiders Buying: 5
Market Capitalization: $624.511 million
CION Investment Corp. is a business development company that primarily provides senior secured loans to U.S. middle-market companies. In November, five insiders, including the President and CEO, co-CEO, and CCO bought approximately $52,700 worth of CION Investment Corporation shares at a price of around $11.42 per share. The stock is currently trading at $11.56 having gone up 1.40% year-to-date.
On November 13, the company announced that its CION Grosvenor Infrastructure Fund has been declared effective by the Securities and Exchange Commission. This positive development might have been the reason behind insider stock purchases in November.
In December, the company declared a special distribution of $0.05 per share for the year ending December 31, 2024. In January the company announced the launch of the CION Grosvenor Infrastructure Fund with $240 million invested in infrastructure assets.
According to data from StockAnalysis, two analyst’s average rating on CION stock is “Hold,” and the 12-month price target is $12.25, representing an increase of 5.97% from the latest price.
9. Wolfspeed, Inc. (NYSE:WOLF)
Number of Insiders Buying: 5
Market Capitalization: $924.87 million
A manufacturer of silicon carbide (SiC) materials and devices, integral to the advancement of electric vehicles (EVs), renewable energy systems, and 5G telecommunications, Wolfspeed is one of 10 small-cap stocks insiders are buying recently. In November, as many as five insiders bought around $846,870 worth of Wolfspeed shares at a price of around $6.78 per share. The stock is currently trading at $5.92 per share, meaning it is even more affordable now than when insiders were buying.
According to data from StockAnalysis, the average rating for WOLF stock from 16 analysts is “Hold.” The 12-month stock price forecast is $14.86, signaling a solid upside.
For the second quarter of fiscal 2025, Wolfspeed reported net revenue of $181 million, compared to $208 million in the same period of fiscal 2024. The company is focused on expanding its manufacturing capabilities and enhancing operational efficiency.
Over the last five years, Wolfspeed shares lost 87.78%. However, recent insider purchases show the management’s confidence in the company’s strategic plan.
8. Granite Ridge Resources, Inc. (NYSE:GRNT)
Number of Insiders Buying: 6
Market Capitalization: $799.5 million
In November and December, six insiders, including President and CEO, CFO, and directors, acquired about $741,000 worth of Granite Ridge Resources shares at an average price of $6.35 per share. The stock is currently trading at $6.20 per share, having declined 4.02% year-to-date.
The average rating for GRNT stock from three analysts is “Buy,” with a 12-month stock price target of $7.6, according to data from StockAnalysis. One Wall Street analyst forecasts a higher price of $8.80.
Granite Ridge Resources has a diverse portfolio of wells and top-tier acreage across the Permian basin and four other prolific unconventional basins across the United States. This is a hybrid oil and gas company and private equity firm, touting the benefits of both organization types. A non-operated oil and gas company means that it does not drill or operate its own wells. Instead, it focuses on increasing asset diversity to reduce risk.
Over the last 12 months, its shares gained 16.32%.
In its latest financial report for the third quarter of 2024, the company reported consolidated oil and gas sales of $94.08 million, compared to $108.40 million in the comparable quarter of 2023. This is a dividend-paying stock, and in the third quarter it declared a regular quarterly dividend of $0.11 per share.
7. Horizon Kinetics Holding Corporation (OTCPK:HKHC)
Number of Insiders Buying: 6
Market Capitalization: $735.869 million
Horizon Kinetics Holding Corporation is a diversified investment management firm specializing in equity and alternative investments, and the seventh among 10 small-cap stocks with heavy insider trading activity recently.
In November and December, six insiders including CEO and CIO, CCO, and COO purchased approximately $38,952 worth of the company’s shares at a price of around $38.3 per share. Horizon Kinetics shares are now trading at $39.50 having gained 9.72% year-to-date.
For the third quarter ended September 31, 2024, the company disclosed revenue of $15.37 million, which compares to $12.75 million in the same quarter of 2023. Net loss for the quarter amounted to $38.17 million, which compares to net income of $25.48 million in the comparable period of the prior year.
Currently, there is limited analyst coverage on this stock, however, recent insider trading activity signals the management’s belief in the company’s potential.
Over the past 12 months, the company’s shares gained 120.67%.
6. Community West Bancshares (NASDAQ:CWBC)
Number of Insiders Buying: 7
Market Capitalization: $369.815 million
Seven insiders, including the President, acquired a total of $19,780 worth of Community West Bancshares shares at an average price of $19.67. The stock is currently trading at $19.44 per share, as it went up 0.36% since the beginning of the year. Over the last five years, shares of this financial institution which offers a range of banking services such as commercial and residential estate loans and consumer loans, lost merely 0.31%.
The average analyst rating for Community West Bancshares stock from 2 stock analysts is “Buy”. This means that analysts believe this stock is likely to outperform the market over the next twelve months. Their average projected price target is $23 for an upside of 18.31%.
For the three months ended December 31, 2024, Community West Bank reported unaudited consolidated net income of $6.9 million and diluted earnings per share of $0.36, which compares to $5.89 million and $0.50 per diluted common share for the same period year ago. The company also declared a $0.12 per common share cash dividend.
Even though the stock’s price hasn’t changed much from when insiders acquired shares in November, their moves reveal the management’s conviction that the stock will perform well.
5. Myers Industries, Inc. (NYSE:MYE)
Number of Insiders Buying: 7
Market Capitalization: $438.548 million
Myers Industries is a manufacturer of sustainable plastic and metal products for various markets, including agricultural, automotive, commercial, marine, and consumer. The company is also among the largest distributors of tools, equipment and supplies for the tire, wheel, and under-vehicle service industry in the United States.
In November and December seven insiders, including Interim President & CEO, acquired around $325,920 worth of Myers shares at an average price of around $11.84 per share. The stock is now trading at $12.27 per share, having gained 11.14% since the beginning of the year. Over the last 12 months, Myers stock lost 33.78%. In August and September, the stock was trading a bit higher, at $14 and $15 per share, so November’s drop in price could be one of the reasons the management decided to buy more shares.
According to the data from MarketBeat, one analyst has a “Hold” rating on the stock, with an average price target of $22.00, for an upside of 79.37%.
4. The York Water Company (NASDAQ:YORW)
Number of Insiders Buying: 7
Market Capitalization: $444.407 million
Over the past three months, seven insiders, including the President and CEO, and CFO purchased around $15,300 worth of the York Water Company shares at an average price of $32.35 per share. The York Water Company’s shares are now trading at $31.72 having lost 3.07% year-to-date. Over the last 12 months, the shares declined 10.54% hitting the lowest price of $30.03 in January.
Five insiders used this January drop to acquire shares at a price of $31.25, while the two that bought the shares in November and December had to pay $35.66 and $34.60, respectively. This could suggest that the management is confident in the company’s future results, and that it just used the drop in the price to acquire more shares.
York Water Company, which provides high-quality water and wastewater services to customers in Pennsylvania, has a history spanning over 200 years. It was founded in 1816 by a group of local businessmen wanting to do something about fire protection. Over the last 15 years, York Water Company shares gained 139.83%.
In December, The York Water Company closed on the acquisition of two water systems, one in York and the other in Adams County, and it also bought the water distribution system at the Brookhaven Mobile Home Community in Hallam Township, York County.
In January, the company’s management declared a quarterly dividend of $0.2192 per share. This was the company’s 617th consecutive dividend to be paid. The company touted it has never missed a dividend in over 209 years, and that this is believed to be the longest record of consecutive dividends in America.
3. Mid Penn Bancorp, Inc. (NASDAQ:MPB)
Number of Insiders Buying: 8
Market Capitalization: $567.125 million
Mid Penn Bancorp is a regional bank holding company headquartered in Harrisburg, Pennsylvania, offering a range of financial services through its subsidiary, Mid Penn Bank. It is one of the 10 small-cap stocks insiders are buying recently.
In December and January, eight insiders, including the President and CEO acquired around $117,400 worth of Mid Penn Bancorp shares at an average price of $29.65 per share. The stock is now trading at $29.82 per share, having gone up 3.40% since the beginning of the year. Over the past 12 months, its shares gained 42.07%.
According to StockAnalysis, two analysts have a consensus “Buy” rating on the stock, with a price target of $36.00 for an upside of 20.72%.
For the fourth quarter of 2024, Mid Penn Bank reported net income available to common shareholders of $13.2 million, or $0.72 per diluted common share, compared to net income of $12.1 million, or $0.73 per diluted common share, for the fourth quarter of 2023. At the same time, its board of directors declared a cash dividend of $0.20 per common share, making this a 57th consecutive quarterly dividend.
Investors who decided to invest in Mid Penn Bank five years ago would have gained 21.62% on their investment.
2. Flushing Financial Corporation (NASDAQ:FFIC)
Number of Insiders Buying: 9
Market Capitalization: $469.544 million
On December 12, as many as nine insiders, including the President and CEO, bought around $248,460 worth of Flushing Financial Corporation shares at a price of $15.25 per share. The company priced common stock offering, and the management took part in raising the capital. This could signal management’s confidence in the company’s future. During the fourth quarter, the company took several actions to improve profitability and strengthen the balance sheet, including raising $70 million of common capital.
The stock is currently trading at $14.15, having lost 0.91% year-to-date. Over the last 12 months, the shares dropped 6.17%.
Flushing Financial Corporations is a New York-based bank holding company, operating through its subsidiary, Flushing Bank. It provides various financial services, such as commercial and residential real estate loans, construction loans, and consumer loans.
As per the data from StockAnalysis, the consensus rating on the stock is “Hold” from four analysts. Their price target is $15.50 for an upside of 9.54%.
1. Financial Institutions, Inc. (NASDAQ:FISI)
Number of Insiders Buying: 15
Market Capitalization: $529.43 million
Financial Institutions is a financial holding company with approximately $6.1 billion in assets as of December 31, 2024, offering banking and wealth management products and services. Its subsidiary Five Star Bank provides consumer and commercial banking and lending services.
On December 11th, the company announced the pricing of its previously announced underwritten public offering of 4,000,000 shares of its common stock at a public offering price of $25.00 per share. Two days after as many as 15 insiders, including the President and CEO, and CFO, acquired around $835,000 worth of Financial Institutions’ shares at a price of $25 per share. The stock is now trading at $27.88 per share, having gained 2.16% year-to-date.
When management of a company takes part in the priced share offering, it can suggest that it has valuable insights into the company’s strategic plans and that it believes in its potential.
According to StockAnalysis, four analysts have a consensus “Buy” rating on Financial Institutions’ stock, with a price target of $29.75 for an upside of 6.71%. Over the past 12 months, the company’s shares gained 42.90%.
Overall, FISI is first among the 10 small-cap stocks insiders are buying recently. While we acknowledge the potential of FISI, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns, and doing so within a shorter timeframe. If you are looking for an AI stock that is more promising than FISI but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
READ NEXT: 20 Best AI Stocks To Buy Now and Complete List of 59 AI Companies Under $2 Billion in Market Cap
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