Undervalued Small-Caps with Insider Backing: Why SolarEdge and Camping World Could Be Contrarian Winners

The U.S. small-cap sector has been a battleground of volatility and uncertainty in recent years, with many companies struggling to stabilize margins amid supply chain disruptions, inflation, and shifting consumer preferences. Yet within this chaos, a handful of overlooked firms are showing resilience through strong revenue growth, strategic innovation, and—critically—insider buying activity that suggests long-term confidence. Two such companies, SolarEdge Technologies (SEDG) and Camping World Holdings (CWH), exemplify this dynamic. Both are small-cap stocks trading at depressed valuations despite clear growth catalysts, and their recent insider purchases serve as a contrarian signal for patient investors.

SolarEdge Technologies: Betting on Renewable Resilience

SolarEdge's stock has been a rollercoaster ride. Its market cap plummeted 62% in the year to June 2025, dipping to $1.05 billion—a stark contrast to its 2023 peak of $5.3 billion. Yet beneath the volatility lies a company with 12% sequential revenue growth in Q1 2025 ($219.5 million) and a clear path to profitability. Despite a non-GAAP net loss of $66.1 million, SolarEdge is reducing cash burn, with free cash flow improving to $19.8 million, and its balance sheet shows net cash of $113 million—a cushion in uncertain times.

What makes SolarEdge compelling is its strategic pivot to EV charging infrastructure, a sector projected to grow at 20% annually through 2030. This diversification, paired with its dominance in solar inverters (a $16 billion market), positions it to capitalize on the global energy transition. The contrarian edge here is insider buying: Chairman Avery More purchased 411,000 shares in March 2025 at $13.70—a bold bet at a time when the stock was near multiyear lows. This signals confidence in SolarEdge's ability to turn margins around as economies of scale kick in.

Camping World: Niche Retail's Quiet Comeback

Camping World's valuation has also been battered. Its market cap of $1.82 billion as of June 2025 reflects a sector in flux, but the RV retailer has quietly improved its fundamentals. Despite a Q1 net loss of $12.28 million, its adjusted EBITDA surged 278% year-over-year to $31.1 million, and it's on track for 115% annual earnings growth. The company's dividend stability ($0.125 per share) and focus on service revenue (via its Good Sam membership) provide recurring income in a cyclical industry.

The insider angle here is CEO Matthew Wagner's $1.01 million purchase of 100,802 shares in March 2025, at a time when the stock was near its lowest since 2021. This contrasts with former CEO Marcus Lemonis's prior selling—a shift in leadership that may reflect Wagner's belief in Camping World's asset-light model and its ability to capitalize on rising demand for outdoor recreation. While the RV market faces headwinds (e.g., inventory constraints), Camping World's 30% gross margins and control of 25% of the U.S. RV service market give it a durable moat.

The Contrarian Play: Mean Reversion and Insider Signals

Both stocks are trading at negative P/E multiples (SolarEdge -0.6x, Camping World -38.3x), a sign that Wall Street is pricing in sustained losses. Yet history shows that small caps often rebound sharply when their core businesses stabilize. For SolarEdge, a mean reversion in gross margins (currently pressured by tariffs) could unlock valuation upside. For Camping World, a sustainable return to profitability (aided by its dividend and operational focus) could attract broader investor interest.

Insider buying is a critical contrarian indicator here. When executives buy shares at depressed prices—especially in volatile sectors—it suggests they see a disconnect between short-term pain and long-term potential. SolarEdge's innovation pipeline and Camping World's service-driven moat are assets that could power recovery once macro conditions normalize.

Risks and Considerations

• SolarEdge: Tariffs on solar components remain a near-term headwind, and EV infrastructure adoption could lag expectations.
• Camping World: The RV market is cyclical, and rising interest rates could dampen consumer spending on discretionary travel.
• Both: Small-cap stocks are inherently riskier, with higher volatility and liquidity risks.

Investment Thesis

For investors willing to look beyond the noise, SolarEdge and Camping World offer asymmetric upside. Both are underfollowed, technically undervalued, and have insider validation at support levels. A strategic allocation—say, 3-5% of a portfolio—could pay off as their growth drivers materialize.

SolarEdge's EV charging pivot and Camping World's EBITDA rebound are catalysts worth monitoring. Meanwhile, the historical context of small-cap resilience—small-caps outperformed large caps by 10% annually from 2010-2020—supports the case for selective exposure now.

In a market starved for genuine growth stories, these two small-caps could be the hidden gems that outperform when sentiment turns. The question is: Will you buy now, or wait for the crowd?