Key Points
- Insiders are buying small-cap stocks in May, but not the insiders you think: activist investors stand tall.
- The stocks in focus have deep values that are underappreciated by the market.
- Their stock prices are at low levels in Q2, but they have a robust turnaround outlook.Â
This is a look at five hot small-cap stocks insiders bought in April and early May. This is significant because April and early May were the peak of tariff fears, and small caps are among the hardest hit by higher prices. The takeaway is these stocks have limited exposure to tariffs (now delayed), and are well-positioned for increased domestic activity. The caveat is that insider buying doesn’t mean company execs, but significant shareholders, including activist investors. The question is how high it is and whether insider buying is a sign investors should buy too.Â
Clear Channel Outdoors, Clearly an Opportunity for Investors
Clear Channel Outdoors (NYSE: CCO) is not in good shape, carrying significant debt and showing no revenue growth. However, its insider buying is a signal of opportunity because it involves a potential takeover from an activist investor.
Arturo Moreno, owner of the Los Angeles Angels, has been purchasing this stock regularly and recently took his holdings to over 10%, giving him significant influence over the company’s future. That future may be unknown, but it likely includes reinvigorating the mass-market advertising business and technology platform.
Four analysts tracked by InsiderTrades.com rate this stock as a Hold with potential for 35% upside at the low-end range and 75% at the consensus.Â
Transcontinental Realty Investors, Making Money for Investors
Transcontinental Realty (NYSE: TCI) Investors is a small real estate investment trust with a portfolio of holdings across the continental United States.Â
The latest quarterly filing shows less than $15 million in revenues offset by significant YOY profitability improvement and a 40% net income margin. Insiders buying this company include itself, which is aggressively buying back shares and owns about 40% of the stock.
Institutions, including BlackRock, Vanguard, and JPMorgan Chase, also own significant amounts of the stock and are buying on balance in 2025.Â
Cracker Barrel: Rebounding from the Barrel’s Bottom
Cracker Barrel’s (NASDAQ: CBRL) stock price has been in correction for years as the COVID-19 business impact and post-pandemic normalization played out. In spring 2025, the stock price is in rebound mode and rising from rock bottom pricing.
The move coincides with purchases made by GMT Capital Corp, manager of Bay Resources Partners Funds and a major shareholder. Tom Claugus founded the fund, focusing on value plays with a long-term time horizon. It owns about 10% of CBRL stock, and the position may continue to grow.
Cracker Barrel is in a business rebound driven by store rationalization, remodels, menu updates, and rapidly improving comp store numbers. Analysts rate it as a Hold in May and see it advancing about 5% from the $53.50 level.Â
1-800-FLOWERS, Dialing up Deals for Activist Investors
1-800-FLOWERS (NASDAQ: FLWS) stock price is bobbing at long-term lows in 2025 due to business contraction and irregular profitability.
However, it is being bought by activist investor Fund 1 Investments, LLC. Fund 1 Investments is a Puerto Rico-based hedge fund focused on consumer values.
It owns more than 10% of the stock and may continue adding. An ongoing CEO change is a step in the right direction for this company, which may be able to reinvigorate business quickly. Three analysts rate it as a Hold and view it as deeply undervalued, trading at $5, about 45% below the consensus.
MasterCraft Boat Holdings, Institutional Holdings GrowÂ
MasterCraft (NASDAQ: MCFT) is yet another deep-value small cap getting bought up by institutional holders.
Its recent buyer is Forager Fund, LP, an Australian-based fund focused on undervalued, out-of-favor small caps. It is a 10% owner of MasterCraft, a manufacturer of fine watercraft, but it is not the only major shareholder—the top three, including Forager and Colliseum Capital, own about 40% of the business. The business is amid contraction in 2025 but nearing an inflection point, expected to return to growth by the year’s end.
Companies in This Article:
| Company | Current Price | Price Change | Dividend Yield | P/E Ratio | Consensus Rating | Consensus Price Target |
|---|---|---|---|---|---|---|
| MasterCraft Boat (MCFT) | $17.47 | -0.4% | N/A | -43.75 | Hold | $20.00 |
| Cracker Barrel Old Country Store (CBRL) | $54.32 | +0.2% | 1.84% | 30.03 | Hold | $57.13 |
| Transcontinental Realty Investors (TCI) | $33.80 | -3.0% | N/A | 91.35 | N/A | N/A |
| 1-800-FLOWERS.COM (FLWS) | $5.15 | -1.7% | N/A | -46.95 | Hold | $7.50 |
| Clear Channel Outdoor (CCO) | $1.16 | -1.3% | N/A | -3.95 | Hold | $2.04 |
Experience
Thomas Hughes has been a contributing writer for InsiderTrades.com since 2019.
Areas of Expertise
Technical analysis, the S&P 500; retail, consumer, consumer staples, dividends, high-yield, small caps, technology, economic data, oil, cryptocurrencies
Education
Associate of Arts in Culinary Technology
Past Experience
Market watcher, trader and investor for numerous websites. Founded Passive Market Intelligence LLC to provide market research insights.
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