In this article, we will take a detailed look at 10 Small–Cap Stocks Insiders Are Selling Recently. We previously covered 10 Small–Cap Stocks Insiders Are Buying Recently.
Why are some investors focusing on stocks with smaller market capitalizations? Among some of the reasons are diversification of their portfolios, because small-cap stocks usually operate in different industries than large-cap companies. Another reason is the share price, which is often lower than that of companies with larger market capitalization (above $10 billion), making them more affordable.
Some investors’ strategy is finding nascent companies with strong growth potential, which can bring high returns once the companies have grown. Even though small-cap stocks often carry higher risks and are more prone to market volatility, they also offer investors more room for growth.
What are some ways to assess small-cap stocks that are worth investing in? While there’s no single simple or complicated rule that investors can follow to achieve secure results, some strategies can help. One strategy is to keep track of insider trading activity. Insiders or, in other words, people in high positions within companies, such as CEOs, CFOs, directors and other executives have valuable 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.
Does this mean that it is a bad sign for the company when insiders sell their shares? Not necessarily; just like insider buying activity doesn’t always mean stock is heading for growth. When insiders are selling their shares, it can sometimes mean that the management is losing confidence. On the other hand, it also happens that large shareholders just want to trim their holdings to more appropriate position sizes based on the risk/reward. Insiders can also decide to sell their shares due to personal financial reasons that have nothing to do with the company.
While both insider selling and buying can be driven by various motives, it’s important to consider these moves within the broader context of the company’s fundamentals, industry trends, and overall market conditions.
To identify the 10 large-cap stocks insiders are selling recently, we considered only stocks with a market capitalization of between $250 million to $2 billion. We first used Insider Monkey’s insider trading stock screener and looked for stocks with at least two insiders selling over the last two months.
With each stock we note the number of recent insider sales 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 trader in a suit and tie intently studying real time stock market data in a modern trading room.
10. Enfusion, Inc. (NYSE:ENFN)
Number of insiders selling: 6
Market capitalization: $1.063B
Enfusion is a provider of software-as-a-service solution services with a focus on the investment management industry. It simplifies investment management operations by connecting front, middle and back-office functions under one cloud-native SaaD platform. The Chicago, Illinois-headquartered fintech company offers several professional tools such as Portfolio Management System and Order and Execution Management System.
Over the past two months, six insiders, among which are the company CEO, and CFO, sold around $372,671 worth of Enfusion shares at an average price of $10.26 per share. Since the beginning of the year, the stock gained 7.57% and is now trading at $11.08 per share.
As many as five of these insider sales happened on January 7, just six days before Enfusion announced it has signed an agreement to be acquired by Clearwater Analytics (NYSE:CWAN) in a deal worth approximately $1.5 billion. This could indicate that several insiders might have decided to sell their shares before the sale of the company. Why? There can be uncertainties about the acquisition deal and concerns about the future’s prospects. Or, some investors might have sold their shares out of fear the price might drop after the acquisition.
How do analysts feel about the deal? In January, Morgan Stanley (NYSE:MS) downgraded the rating on Enfusion stock from “Overweight: to “Equal-weight, and also raised the price target to $11.25 from $11.00. The downgrade came in response to the announced acquisition, writes Investing.
According to data from StockAnalysis, five analysts have an average “Hold” rating on Enfusion stock, and the 12-month price target is set to $10.38.
On the other hand, eight analysts have an average “Buy” rating on Clearwater stock and the 12-month price target is $31.75. Clearwater shares are currently trading at $27.51 per share.
9. PubMatic, Inc. (NASDAQ:PUBM)
Number of insiders selling: 7
Market capitalization: $756.625M
PubMatic, a digital advertising technology company is ninth among 10 small-cap stocks insiders are selling recently. The Redwood, California-headquartered company provides solutions to enable publishers to enhance the value of their digital advertising inventory.
Over the last two months, and also at the beginning of February, seven insiders sold a total of around $2.03 million at an average price of $15.09 per share. Among those seven insiders was the company CEO, K. Rajeev Goel, who sold 75,513 shares worth around $1.14 million, reducing his ownership to 5,896 shares.
As many as nine analysts have the average “Buy” rating on PubMatic stock, and the 12-month stock price target is $20, representing an increase of 28.87% from the latest price, according to data from MarketBeat.
Since the beginning of the year, PubMatic shares gained 5.58%, now trading at $15.52. Over the past 12 months, the stock went slightly up – 3.72%, while over the last five years, it has lost 38.06%.
In December, the company announced an expansion of its collaboration with Western Union to include its commerce media business. The same month, PubMatic also expanded its global partnership with GroupM Premium Marketplace.
For the third quarter of 2024, PubMatic disclosed revenue of $71.8 million, up 13% year-over-year. Its gross profit grew year-over-year by 23% to $46.3 million, but the company also reported GAAP net loss of $900,000, which compares to GAAP net income of $1.8 million in the same quarter of the prior year.
8. Two Harbors Investment Corp. (NYSE:TWO)
Number of insiders selling: 7
Market capitalization: $1.337B
The eighth small-cap stock that insiders have been ditching recently is a real estate investment trust (REIT) focusing on residential mortgage-backed securities (RMBS) and other real estate-related assets. With its operational platform, RoundPoint Morgage Servicing LLC, it is considered among the biggest servicers of conventional loans in the country. Two Harbors’ investment strategy is designed with the goal of bringing returns across various market environments. More than 60% of its capital is allocated to hedged MSR, and the rest of its capital is allocated to hedged RMBS, with the idea of minimizing portfolio exposure to fluctuations in mortgage spreads.
In January seven insiders among which are the company’s CEO, and CIO sold a total of around $911,753 worth of Two Harbors shares, at an average price of $11.21. The stock has gained 19.4% since then and it is now trading at $13.39 per share.
As many as eight Wall Street analysts have an average “Buy” rating on Two Harbors stocks, with a 12-month price target of $13.63, as per data from TipRanks.
For the fourth quarter ended December 31, 2024, Two Harbors incurred a comprehensive loss of $1.6 million, or $0.03 per weighted average basic common share. The company also declared a quarterly dividend of $0.45 per share.
While seven investors have sold some of their holdings in Two Harbors stocks, some institutional investors like Vanguard Group Inc. and Allspring Global Investments Holdings increased their ownership in the fourth quarter.
7. Getty Images Holdings, Inc. (NYSE:GETY)
Number of insiders selling: 7
Market capitalization: $1.175B
Getty Images, a leading global provider of premium visual content and services, operates under three popular brands – Getty Images, iStock, and Unsplash+. It provides a wide collection of high-quality images and videos to media businesses and various creative experts across the globe. Getty Images collaborates with over 576,000 content creators and more than 340 content partners to deliver this comprehensive content.
In December, seven insiders, including CEO, and CFO, sold a total of around $211,220 worth of the company’s shares at an average price of $2.29 per share. The stock is currently trading at $2.72 per share. Since the beginning of the year, Getty shares have gained 25.23%. On December 30, the stock reached its lowest price of $2.10, so it is possible that insiders were expecting this drop and wanted to sell some of their holdings beforehand.
Earlier in December, the company announced a strategic engagement with Clarifai, a global provider of AI orchestration and development and pioneer of the full‑stack computer vision platform. Then, in January, Getty confirmed it will merge with another visual content gian – Shutterstock (NYSE:SSTK). The combined company, which would have an enterprise value of approximately $3.7 billion, will be named Getty Images Holdings, Inc and will continue to trade on the New York Stock Exchange under the ticker symbol “GETY.” The news caused Getty Images share to jump to $3.19 per share that day.
How do analysts feel about Getty Images? SeekingAlpha’s analyst Andriy Blokhin writes that even though the merger aims to achieve $150-$200 million in cost savings and potentially improve margins there are some areas of concern such as stagnating content sales amid AI competition.
On the other hand, as per data from StockAnalysis, five analysts have an average “Buy” rating on the stock, with a 12-month price target of $5.61, representing an increase of 106.25% from the latest price.
In the third quarter of 2024, the company had revenue of $240.5 million, an increase of 4.9% year-over-year. Net loss amounted to $2.5 million, compared to net loss of $18.4 million in the same quarter of 2023. Furthermore, the company has experienced nine consecutive quarters of strong double-digit growth in its annual subscriber base. This growth has been fueled by the success of its e-commerce platforms, particularly iStock and Unsplash+, which have attracted new customers from target growth markets across EMEA, APAC, and the Americas and supported the company’s geographic expansion strategy. The company’s subscription business contributed to more than 50% of its total revenue in the quarter.
Getty is also one of the 10 Best Affordable Stocks Under $5 to Buy Now.
6. Jack in the Box Inc. (NASDAQ:JACK)
Number of insiders selling: 7
Market capitalization: $802.871M
Jack in the Box is a popular quick-service restaurant chain in the US, known for its diverse menu and strong national presence. The San Diego, California-headquartered company operates franchises Jack in the Box and Del Taco quick-service restaurants. It was founded back in 1951.
In December, seven insiders sold a total of approximately $932,125 worth of Jack in the Box shares, at an average price of $40.73 per share. Out of the total amount, the company’s CEO, S Darin Harris, sold 14,671 shares worth around $594,468 reducing his ownership to 138,803 shares.
As per 17 analysts’ average rating, Jack in the Box is “Buy.” The data from StockAnalysis also revealed that analysts have an average 12-month price target of $54.5, representing an increase of 36.59% from the latest price.
Since the beginning of the year, Jack in the Box shares declined 4.18%, with the stock currently trading at $39.90 per share. Over the past five years, the shares also declined 54.82%.
A bull-case theory for Jack in the Box suggests that despite a challenging 2024, analysts believe the company will have steady earnings per share growth of around 9% annually through 2029, even when taking near-term challenges into account. The company’s stock has historically traded at an average price-to-earnings (P/E) multiple of around 17x, and applying this multiple to revised earnings estimates suggests a target price of $123 by 2029, a significant upside from the current stock price of $39.90.
5. Bicycle Therapeutics plc (NASDAQ:BCYC)
Number of insiders selling: 8
Market capitalization: $870.67M
In the middle of this list of 10 small-cap stocks insiders are selling recently is Bicycle Therapeutics, a clinical-stage biopharmaceutical company, focused on the development of a class of medicine for undeserved diseases in the US and the UK.
The company’s proprietary Bicycle platform technology develops novel peptide-based therapeutics for oncology treatment. The company’s goal is to become the leader in solid tumor medicine by the number of patients able to treat. Bicycle Therapeutics develops a class of medicines called Bicycles, which are chemically synthesized peptides constrained to form two loops. These structures demonstrate high stability and affinity for targets, translating into therapies having favorable efficacy and safety profiles.
The company’s leading candidate zelenectide pevedotin (formerly BT8009), has been positioned as a potential alternative to existing treatments like Padcev for patients with metastatic urothelial carcinoma (mUC). While the company is primarily focused on oncology treatments, its Bicycle platform shows huge potential for expansion into other therapeutic areas.
In its latest update on the leading candidate, the company revealed that new data continue to position zelenectide pevedotin as a potentially promising best-in-class therapy for mUC.
In January, eight insiders, among which is the company’s CEO, sold a total of around $548,178 worth of shares, at an average price of $14.41. The stock is currently trading $12.49 having lost 10.79% since the beginning of the year. Over the last five years, its shares declined 16.34%.
As many as nine analysts have an average “Buy” rating on the stock, and the 12-month price target is $33.25. This represents an increase of 166.21% from the latest price, as per data from StockAnalysis.
Bicycle Therapeutics is also one of the 10 Top Performing European Stocks Heading into 2025.
4. Intellia Therapeutics, Inc. (NASDAQ:NTLA)
Number of insiders selling: 8
Market capitalization: $1.032B
Intellia Therapeutics is a clinical-stage biotechnology company focused on developing novel, potentially curative therapeutics leveraging CRISPR-based technologies. The company is focused on developing new treatments for both in vivo and ex vivo applications. Its flagship program, NTLA-2011 is focused on treating transthyretin amyloidosis, which is currently an incurable disease. Intellia also has various other programs in its pipeline that are in different trial stages.
In January, eight insiders, including President and CEO, sold a total of approximately $833,916 worth of Intellia shares, at an average price of $11.92. The stock is currently trading at $9.64, having declined 17.32% year-to-date.
As many as 20 Wall Street analysts have an average “Strong Buy,” rating on Intellia stock, and the price target is $43.44, with the highest forecast of $91.00 and the lowest at $11.00, according to data from TipRanks. The average price forecast represents a 350.62% change from the last price of $9.64.
On January 27, Morgan Stanley downgraded Intellia Therapeutics stock from “Overweight” to “Equal Weight”, and also considerably lowered its price target – from $56 to $11. Morgan Stanley noted huge competition from alternative therapies that do not involve gene editing.
For the third quarter of 2024, Intellia reported collaboration revenue was $9.1 million compared to $12.0 during the third quarter of 2023. The $2.9 million decrease was mainly driven by a reduction in revenue related to the AvenCell license and collaboration agreement. Net loss for the quarter was $135.7 million, compared to $122.2 million during the third quarter of 2023.
Intellia Therapeutics is also one of Cathie Wood’s Stock Portfolio: 2025 Stock Picks.
3. Travere Therapeutics, Inc. (NASDAQ:TVTX)
Number of insiders selling: 8
Market capitalization: $1.899B
Travere Therapeutics is another biopharmaceutical company developing therapeutics for rare diseases among 10 small-cap stocks that insiders have been selling recently. Its main focus is treatments for rare kidney and metabolic diseases. The company’s lead drug candidate, sparsentan, has obtained U.S. Food and Drug Administration (FDA) approval for slowing kidney function decline.
Earlier this month, Travere Therapeutics announced it has completed its Type C meeting with the FDA and plans to submit a supplemental New Drug Application (sNDA) seeking traditional approval of filspari for focal segmental glomerulosclerosis (FSGS). The sNDA will be based on existing data from the Phase 3 DUPLEX and Phase 2 DUET studies of filspari and is expected to be submitted around the end of the first quarter of 2025.
For the third quarter of 2024, Travere Therapeutics reported net product sales of $61 million, compared to $33.9 million for the same period in 2023. The increase is attributable to sales from the ongoing commercial launch of filspari.
In January and the beginning of February, eight insiders, among which are CEO, CFO, and CMO sold around $2.97 million worth of Travere Therapeutics shares at an average price of $19.61 per share. The stock is currently trading at $23.72 per share, having gained 36.17% since the beginning of the year.
According to data from MarketBeat, 14 Wall Street analysts have a consensus rating of “Moderate Buy” on Travere Therapeutics stock. The average price target is $27.77, indicating a forecasted upside of 17.07% from the current price.
2. Skyward Specialty Insurance Group, Inc. (NASDAQ:SKWD)
Number of insiders selling: 9
Market capitalization: $1.969B
Skyward Specialty is an insurance company providing commercial property and casualty insurance products in the US. The offering includes general liability, excess liability, professional liability, commercial auto, group accident and health, property, surety, and workers’ compensation insurance products.
Insider Monkey recently shared a Bull Case Theory for Skyward Specialty Insurance Group. In summary, the thesis argues that while natural disasters bring short-term risks, the company’s disciplined pricing and risk management should protect its capital in the long term. In 2023, many property and casualty insurers posted underwriting losses with a combined ratio of 101.5%, Skyward delivered a 90.7% ratio, showcasing its capability to drive consistent profits.
The company’s ability to navigate these challenges reinforces its long-term investment appeal. Valuation-wise, insurance companies are often assessed based on price-to-book ratios, with the industry averaging around 1x book value. Given Skyward’s profitability and book value per share growth of 23% annually over the past three years, a 2.5x price-to-book multiple is justified. Assuming book value continues to grow at a conservative 16% per year, Skyward’s stock could reach $107.23 by 2029, representing a 19% CAGR from current levels. With a strong management team, industry tailwinds, and disciplined execution, Skyward Specialty Insurance presents a compelling investment case with significant upside potential.
In January, nine insiders, among which is the company’s CEO sold around $2.34 million worth of Skyward Specialty shares at an average price of $47.57. The stock is now trading at $50.82 per share, having gone up 0.55% since the beginning of the year. Over the last 12 months, Skyward Specialty shares gained 56.32%.
The average rating on the stock from 10 analysts is “Buy,” while the 12-month stock price target is $53.0.
1. BlackSky Technology Inc. (NYSE:BKSY)
Number of insiders selling: 10
Market capitalization: $512.161M
BlackSky Technology is a technology company that offers geospatial intelligence, imagery and related data analytic products and services. It is also one of the Top 10 AI Stocks to Watch Amid US-China AI War. The company’s Spectra software platform processes various observations from its satellite constellation and other external data sources, such as imaging, radar and radio frequency satellites.
In February, BlackSky Technology announced it had signed a multi-year contract with geospatial intelligence fusion specialist Emerging Dynamics. Under this deal, the company will be able to provide satellite imagery services for defense clients worldwide.
The company also recently confirmed it has secured multi-year contracts with a combined value of eight figures to provide India with advanced Earth observation capabilities.
In December, 10 insiders sold approximately $274,269 worth of BlackSky shares at a price of $10.65 per share. Out of the total amount, the company’s President and CEO, Brian E. O’Toole, sold 7,020 shares, reducing his ownership to 691,909 shares.
Five Wall Street analysts have a “Buy” rating on BlackSky Technology stock, while the 12-month stock price target is $19.20. The stock is currently trading at $17.76 per share, having gained 64.60% since the beginning of the year.
Overall, BKSY is first among the 10 small-cap stocks insiders are buying recently. While we acknowledge the potential of BKSY, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns, and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than BKSY 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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