3 Undervalued ASX Small Caps With Notable Insider Action

The Australian Securities Exchange (ASX) is home to a diverse range of companies, with small caps often presenting intriguing investment opportunities. Among these, three undervalued ASX small caps have caught our attention due to their notable insider action and potential for future growth. Let's delve into the specifics of these companies and explore why they might be worth considering.

1. Amotiv (ASX:AOV)
Amotiv specializes in manufacturing and supplying automotive components, with a market cap of A$1.75 billion. The company recently appointed Ms. Raelene Murphy as an independent Non-Executive Director and Chair of the Audit Committee, effective March 2025. This strategic move aims to bolster corporate governance and risk management, which could enhance shareholder confidence and potential future growth. Despite a drop in net income to A$33 million for H1 2024, sales increased slightly to A$503.7 million. The company announced a fully franked interim dividend of A$0.185 per share for 2025, reflecting shareholder commitment amidst insider confidence through share purchases earlier this year. Amotiv's gross profit margin has shown variability, reaching up to 57.13% but more recently around 44.92%. Operating expenses are driven by sales and marketing, R&D, and general administrative costs. With earnings projected to rise by 14.64% annually, Amotiv presents an attractive investment opportunity.



2. nib holdings (ASX:NHF)
Nib holdings is a health and medical insurance provider operating primarily in Australia and New Zealand, with a market capitalization of A$3.33 billion. The company is attracting attention due to its perceived undervaluation, with insider confidence demonstrated by recent share purchases by executives. Nib Holdings forecasts annual earnings growth of 6.25%, suggesting potential for future expansion. However, reliance on external borrowing introduces higher risk compared to firms with customer deposits. The company's gross profit margin has shown variability, reaching 22.73% in December 2023 before decreasing to 13.57% by June 2024. Nib Holdings' strategic initiatives, such as the appointment of Edward Close as director in December 2024, could bring fresh strategic insights and further boost insider confidence and potential future growth.



3. Corporate Travel Management (ASX:CTD)
Corporate Travel Management is a global travel services company operating across Asia, Europe, North America, and Australia/New Zealand with a market capitalization of A$3.15 billion. Insider confidence is evident through Jamie Pherous' purchase of 87,500 shares valued at approximately A$1.4 million. This move suggests potential growth prospects as earnings are forecasted to increase by 12% annually. Recent changes include Deloitte replacing PwC as auditors post-AGM on October 31, 2024, which could enhance operational efficiency and shareholder confidence. Corporate Travel Management's gross profit margin has shown an upward trend from 40.45% in December 2013 to 41.60% by December 2024. Operating expenses have increased over time, with general and administrative expenses being a significant component of these costs. With a PE ratio of 23.4x and a PS ratio of 2.8x, Corporate Travel Management appears undervalued compared to its peers and the broader market.



In conclusion, these three undervalued ASX small caps with notable insider action present intriguing investment opportunities for those willing to take on the higher risk associated with small-cap stocks. By carefully evaluating their strategic initiatives, financial performance, and insider activity, investors can make informed decisions and potentially reap significant rewards. As always, it is essential to conduct thorough research and consider seeking professional advice before making any investment decisions.