3 Undervalued European Small Caps Poised for Upside: Insider Buys Signal Contrarian Opportunity

In a market rattled by geopolitical tensions and economic uncertainty, contrarian investors are turning to small-cap European firms where insider buying and undervalued metrics align. Three companies—Corbion (AMS:CRBN), MedCap (MCAP.ST), and New Wave Group (NEWA-B.ST)—stand out as compelling opportunities. Their fundamentals, strategic insider activity, and growth catalysts suggest they're primed to outperform as institutional recognition catches up. Here's why investors should act now.

1. Corbion (AMS:CRBN): Biodegradable Innovations with Insider Optimism

Corbion, a leader in sustainable ingredients for food and bioplastics, trades at a P/E of 24.96 but has a forward P/E of just 13.57, signaling a valuation reset. Its EV/EBITDA of 9.22 is well below peers, and a 2-stage DCF model pegs fair value at €19.04, while shares trade at €22.82—near fair value but with a 37% upside to analyst targets.

Why Insiders Are Buying:
- Over the past three months, insiders have purchased more shares than sold, reflecting confidence in its plant-based materials growth.
- Key Catalyst: Rising demand for biodegradable products in packaging and food additives, driven by EU sustainability mandates.

2. MedCap (MCAP.ST): Private Equity Exposure at a Discount

MedCap, a Nordic private equity firm, offers a P/E of 42.9x—high, but misleading. Its EV/EBITDA of 16.75 (declining to 9.96x by 2027) and P/B of 6.95x suggest it's pricing in short-term volatility. Despite a fair price estimate of SEK 286, shares trade at SEK 426, but analysts project 13.6% revenue growth this year.

Why Insiders Are Buying:
- Executives like Anders Dahlberg and Anders Larnholt bought shares in early 2025, signaling belief in its portfolio of undervalued assets.
- Key Catalyst: A rebound in private equity exits as post-tariff global trade stabilizes, unlocking hidden value in its holdings.

3. New Wave Group (NEWA-B.ST): Luxury Brands with Strong Cash Flow

New Wave, owner of brands like Sagaform and Cutter & Buck, trades at a P/E of 17.1x—half its peers' average of 35.6x. Its EV/EBITDA of 12.2x and DCF-derived fair value of SEK 212 imply 45% upside from its current price of SEK 116.

Why Insiders Are Buying:
- Jens Petersson, a key insider, boosted his stake by 54% in March 2025, purchasing SEK 25 million worth of shares.
- Key Catalyst: Expansion into Asia-Pacific markets and warehouse automation to cut costs, supporting its 18% earnings growth forecast.

Why Now? Contrarian Timing and Institutional Lag

These companies are undervalued relative to their growth trajectories, yet insiders are acting—a contrarian signal in a market still digesting post-tariff volatility.

• Corbion's biodegradable materials play into a €1.2 trillion sustainability market.
• MedCap's private equity portfolio could benefit from rising exit activity as trade tensions ease.
• New Wave's luxury brands are underpenetrated in Asia, with operating profit up 14% YoY.

Final Call to Action

Investors seeking asymmetric upside should consider these three European small caps. Their insider buying, undervalued multiples, and sector tailwinds suggest they're primed to outperform once institutions recognize their potential. Act now—before the valuation gaps narrow.

Risk Disclaimer: Past performance ≠ future results. Conduct thorough due diligence before investing.