Insider Confidence as a Leading Indicator: Why These 5 Small Caps Deserve Immediate Investor Attention

In the ever-evolving landscape of small-cap investing, insider buying activity has long served as a critical leading indicator of corporate health and future performance. By July 2025, a select group of small-cap stocks has emerged with robust insider confidence, signaling undervaluation and potential growth. These companies, spanning diverse sectors, warrant immediate attention from investors seeking to capitalize on market inefficiencies. Below, we analyze five standout names, each backed by compelling insider activity and financial metrics.

1. On the Beach Group (OTB.L) – Travel Sector Resilience

Market Cap: £0.26 billion
Insider Activity: £6.90 million in insider purchases (Dec 2024–Jun 2025)
Key Metrics:
- Revenue: £64.2 million (H1 2025)
- Net Income: £3 million (H1 2025)
- Earnings Growth Forecast: >24% annually

On the Beach Group, a UK-based online travel platform, has demonstrated remarkable insider confidence through aggressive share repurchases. Executives, including CEO Simon Cooper, spent £6.84 million to acquire shares at prices between GBX 209 and 266. This aligns with the company's strong gross profit margin (116.15%) and projected earnings growth. Despite operating in a volatile sector, OTB's reliance on external borrowing is offset by its strategic focus on high-margin beach holiday packages.

2. Argosy Property (ARG.NZ) – Real Estate Turnaround

Market Cap: NZ$1.27 billion
Insider Activity: NZ$199,550 in insider purchases (Jun 2025)
Key Metrics:
- Net Income: NZ$125.86 million (FY 2024/25)
- Gross Profit Margin: 75.06% (Mar 2025)
- Earnings Decline Forecast: 3.7% annually (next 3 years)

New Zealand's Argosy Property, a real estate investment trust, transitioned from a net loss to a NZ$125.86 million profit in FY 2024/25. Insider purchases by Peter Mence suggest optimism despite forecasts of earnings contraction. The company's 75.06% gross profit margin underscores its operational efficiency, while its focus on industrial and retail properties positions it to benefit from e-commerce-driven demand.

3. Richards Packaging Income Fund (RPI.UN) – Defensive Packaging Play

Market Cap: C$0.67 billion
Insider Activity: CAD $6.98 million in insider purchases (Aug 2024)
Key Metrics:
- Revenue: C$100.71 million (Q1 2025)
- Dividend Yield: 4.3% (C$0.11/month)
- Insider Ownership: 25.78% (as of July 2025)

Richards Packaging Income Fund, a Canadian packaging company, has seen significant insider buying, including a C$6.98 million transaction by CEO John Glynn and major shareholder Gerard Glynn. With a 7% revenue growth forecast and a consistent dividend policy, RPI.UN offers a defensive play in the packaging sector. Insiders hold 25.78% of shares, reflecting deep alignment with shareholders.

4. Aris Mining (ARIS.TSX) – Gold Sector Expansion

Market Cap: $1.2 billion
Insider Activity: Strong insider share purchases (2024–2025)
Key Metrics:
- Revenue: US$157.53 million (Q1 2025)
- Gross Profit Margin: 41.86% (Mar 2025)
- Earnings Growth Forecast: 64.73% annually

Aris Mining, a Canadian gold miner, is expanding its Segovia operations with a second processing mill, boosting capacity by 50%. Insiders have been net buyers, signaling confidence in the company's ability to capitalize on rising gold prices. Despite reliance on external borrowing, Aris's 64.73% earnings growth forecast and strong gross margin make it a compelling play in the cyclical gold sector.

5. MCAN Mortgage (MKP.TSX) – Mortgage Lending Stability

Market Cap: C$0.51 billion
Insider Activity: Increased insider holdings (2024–2025)
Key Metrics:
- Revenue: C$126.46 million (Q1 2025)
- Gross Profit Margin: 88.81%
- Earnings Growth Forecast: 13.95% annually

MCAN Mortgage, a Canadian mortgage lender, maintains a robust 88.81% gross profit margin and consistent quarterly dividends (C$0.41/share). Despite a Q1 2025 net income dip to C$16.59 million, insiders have increased holdings, reflecting confidence in the company's ability to navigate interest rate volatility. Its 13.95% earnings growth forecast further strengthens its appeal as a stable income play.

Why These Stocks Deserve Attention

The five companies above share a common thread: insiders are actively buying shares at current prices, indicating they believe the market has not yet recognized intrinsic value. For example, Richards Packaging's insiders purchased shares at CAD $22.83–23.68, near the current price of CAD $23.00, suggesting potential for revaluation. Similarly, Aris Mining's expansion plans and gold price trends could unlock significant upside.

Investors should consider these stocks as part of a diversified small-cap portfolio, balancing sector exposure and risk tolerance. Entry points near insider purchase prices (e.g., CAD $22.50–23.00 for RPI.UN) and stop-loss levels below key support areas (e.g., CAD $20.00 for RPI.UN) can help manage risk while capturing growth.

Final Thoughts

Small-cap stocks inherently carry higher volatility, but insider buying activity provides a valuable filter for identifying opportunities with strong management conviction. The five companies highlighted here—On the Beach Group, Argosy Property, Richards Packaging Income Fund, Aris Mining, and MCAN Mortgage—offer a mix of growth, income, and defensive characteristics. By aligning with insider optimism and fundamental strength, investors can position themselves to benefit from potential market revaluations in the coming months.