3 Undervalued Small-Caps with Insider Buys: Navigating Volatility Through Strategic Picks

In a market increasingly defined by volatility, small-cap stocks with strong fundamentals and insider confidence stand out as resilient growth opportunities. Three companies—Concrete Pumping Holdings (CPOH), Donnelley Financial Solutions (NLS), and Thermon Group Holdings (THMN)—offer compelling valuations, strategic insider buying, and sector-specific catalysts. Here's why they merit attention.

1. Concrete Pumping Holdings (CPOH): Betting on Infrastructure Resilience

What's Working: CPOH, a leader in concrete pumping and waste management services, reported a 14% rise in revenue for Q1 2025 to $94 million, driven by its U.S. Concrete Waste Management segment, which grew 7% year-over-year. Gross margins expanded to 22%, reflecting operational efficiency.

Insider Activity: While there were no Q2 2025 insider purchases, the Q1 2025 quarter saw significant buying: CEO Bruce F. Young bought 256,941 shares at $5.19 (March 13) and received a stock grant, while Director Stephen A. Alarcon purchased 1,090 shares (March 14). These moves underscore confidence in the company's turnaround strategy.

Why Buy Now? CPOH's stock trades at just 7.5x forward EBITDA, well below peers, and it recently expanded its share repurchase program to $50 million. With infrastructure spending a bipartisan priority in the U.S., its services are critical to projects like highways and housing.

2. Donnelley Financial Solutions (NLS): Software Growth in a Shifting Capital Markets Landscape

What's Working: NLS, a provider of capital markets software and compliance solutions, saw net sales rise 4% to $201 million in Q1 2025. Its software segment, now contributing 65% of revenue, grew 12% as clients increasingly adopt its cloud-based platforms.

Insider Activity: In February 2025, Director Gary G. Greenfield bought 48,890 shares at $48.89—a $2.39 million purchase—marking rare insider buying amid a backdrop of executive selling. While other insiders sold, Greenfield's move signals optimism about NLS's shift toward recurring software revenue.

Why Buy Now? NLS trades at 8.2x EV/EBITDA, a discount to software peers, and its software margins (55%) are expanding. With legacy print services winding down, the focus on SaaS (software-as-a-service) makes it a play on digital transformation in finance.

3. Thermon Group Holdings (THMN): Thermal Solutions in a Green Transition World

What's Working: THMN, a supplier of thermal solutions for industrial and energy clients, reported 2024 revenue of $323 million, with its U.S. segment (60% of sales) growing 5% despite a slowdown in oil and gas. Its industrial division, serving renewable energy and chemical plants, is a key growth lever.

Insider Activity: In Q2 2025, SVP Thomas N. Cerosvki bought 500 shares at $27.72 (May 30), while directors received stock awards totaling 142,332 shares in Q1-Q2. Though much of this activity is compensation-linked, it aligns insiders' interests with shareholders.

Why Buy Now? THMN's stock trades at 8.8x forward EBITDA, near multiyear lows. Its $2.5 billion backlog includes projects for hydrogen production and offshore wind farms, which should drive growth as energy transitions accelerate.

Investment Thesis & Risks

These picks are not without risks. CPOH faces cyclical demand tied to construction spending, NLS must execute its software transition, and THMN's energy exposure could falter if oil prices slump. However, their valuations, insider confidence, and sector tailwinds (infrastructure, fintech, green energy) make them compelling long-term plays.

Action Items:
- CPOH: Buy on dips below $6, with a 12-month target of $8–$10.
- NLS: Accumulate near $45–$50, aiming for $60+ as software adoption accelerates.
- THMN: Consider entry at $30, targeting $40 with backlog execution.

In a volatile market, these small-caps offer a mix of undervalued metrics, strategic insider bets, and secular growth drivers. Investors seeking resilience and upside should look beyond headline noise and focus on fundamentals—these three fit the bill.