10 Undervalued Smallcap Stocks Billionaires Are Quietly Loading Up On

In this article, we will be taking a look at the 10 Undervalued Smallcap Stocks Billionaires Are Quietly Loading Up On.

The US stock market is still under pressure from geopolitical unrest and mounting worries about disruptions caused by artificial intelligence. Investors’ worries that the Middle East crisis could cause inflation by driving up oil prices and disrupting international trade have caused the S&P 500 Index, Nasdaq 100, and Dow Jones Industrial Average to all turn red. As a result, rather than concentrating on credit-sensitive market segments, analysts at Bank of America, Goldman Sachs, and Barclays are advising investors to concentrate on high-quality, high-cash-flow companies with robust balance sheets that can survive uncertainty.

Despite the volatility, several Wall Street firms remain optimistic. Christian Raute, head of markets trading strategy at Citigroup, said, “With the US economy still robust, we expect pullbacks to present attractive entry points.” He added that while these pressures may be inflationary for Europe and parts of Asia, any stabilization could create compelling opportunities. Similarly, strategists at Morgan Stanley and Piper Sandler view any pullback tied to the Iran war as a dip-buying opportunity, especially since many stocks were already trading above historical norms after two years of blockbuster gains.

The argument for cheap growth stocks has been bolstered by this context, especially for businesses with solid balance sheets, scalable operations, and the capacity to profit from long-term megatrends. At the same time, insider buying has emerged as a significant indication, particularly in small companies where volatility and knowledge gaps are frequently greater. Insider purchases are seen by companies like Franklin Templeton and J.P. Morgan Asset Management as a helpful indicator when markets may be mispricing fundamentally sound enterprises.

Adding to this theme, Simeon Hyman, Global Investment Strategist at ProShares, said in a February 5 interview on Schwab Network that market rotation is creating new opportunities in small caps. He noted that small caps were outperforming the S&P 500 year-to-date, with earnings up 25% year-over-year after nearly one-third of companies had reported.

With that said, let’s now take a look at the cheap stocks to buy.

Our Methodology 

For our methodology, we screened for stocks with a forward P/E ratio below 15 and a small market capitalization between $300 million and $2 billion. From this list, we selected stocks with recent news and developments, then ranked them in ascending order based on the total number of billionaire holders out of 107, as tracked by the Insider Monkey database.

Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 498.7% since May 2014, beating its benchmark by 303 percentage points (see more details here).

Here is our list of the 10 undervalued smallcap stocks billionaires are quietly loading up on.

10. BitFuFu Inc. (NASDAQ:FUFU)

Number of Billionaire Holdings: 2

Forward PE Ratio: 13.19

BitFuFu Inc. (NASDAQ:FUFU) is one of the cheap stocks to buy on our list.

TheFly reported on March 23 that H.C. Wainwright reduced its price target for FUFU to $4 from $7 while maintaining a Buy rating on the stock. The adjustment reflects the company’s recent share price movements as well as a significantly weaker environment for bitcoin mining.

Earlier on March 20, BitFuFu Inc. (NASDAQ:FUFU) released its unaudited financial results for the year ended December 31, 2025. The company reported total revenue of $475.8 million, up 2.7% from $463.3 million in 2024, supported by stronger contributions from cloud mining, mining equipment sales, and hosting-related business, while self-mining revenue declined.

FUFU posted a net loss of $57.4 million for 2025, compared with net income of $54.0 million a year earlier, largely due to unfavorable fair value adjustments tied to digital assets and receivables, along with equipment impairment charges. Adjusted EBITDA fell sharply to $8.3 million from $117.9 million in 2024, reflecting the impact of a $32.8 million non-cash fair value loss linked to weaker Bitcoin prices.

As of December 31, 2025, combined cash, cash equivalents, and digital assets stood at $177.1 million, nearly unchanged from $175.1 million at the end of 2024.

BitFuFu Inc. (NASDAQ:FUFU) is a Bitcoin mining and mining services company that provides cloud mining, self-mining, and hosting solutions, helping users and institutions access Bitcoin mining infrastructure more efficiently.

9. Lands’ End, Inc. (NASDAQ:LE)

Number of Billionaire Holdings: 8

Forward PE Ratio: 13.12

Lands’ End, Inc. (NASDAQ:LE) is one of the cheap stocks to buy on our list.

TheFly reported on March 20 that Telsey Advisory lowered its price target on LE to $20 from $25 after the company’s fourth-quarter results came in slightly below expectations. The firm noted that revenue growth was weaker than anticipated, and SG&A expenses showed greater deleveraging than expected. It also said longer-term initiatives, including brand enhancement efforts, increased focus on licensing and marketplace strategies, and the planned joint venture with WHP Global, could improve capital efficiency, lower debt, and support steadier growth.

On March 19, Lands’ End, Inc. (NASDAQ:LE) released its fiscal 2025 fourth-quarter and full-year results. Fourth-quarter net revenue rose to $462.4 million, up 4.7% from $441.7 million, led by U.S. Digital at $402.3 million and eCommerce at $312.0 million.

The company reported that its Outfitters revenue grew to $53.7 million, Third Party to $36.6 million, and Europe eCommerce to $32.9 million, while Licensing and Retail declined to $27.2 million. Gross profit reached $209.6 million with a 45.3% margin. Adjusted net income was $23.6 million, and adjusted EBITDA was $47.4 million.

Moreover, the business’s full-year net revenue totaled $1.34 billion, adjusted net income $26.8 million, and adjusted EBITDA $102.3 million, with cash at $18.3 million and term loan debt at $234.0 million.

Lands’ End, Inc. (NASDAQ:LE) is a U.S.-based retailer offering casual clothing, footwear, and home products through direct-to-consumer channels, emphasizing quality, durability, and classic American style for a broad customer base.

8. Arcos Dorados Holdings Inc. (NYSE:ARCO)

Number of Billionaire Holdings: 8

Forward PE Ratio: 11.81

Arcos Dorados Holdings Inc. (NYSE:ARCO) is one of the cheap stocks to buy on our list.

The Fly reported on March 19 that ARCO reported fourth-quarter results with EBITDA and net income falling short of expectations. After adjusting for nonrecurring tax credits, the company recorded an unexpected net loss of $1 million. Morgan Stanley highlighted that the earnings miss is likely to hurt the stock’s performance. Despite this, the firm maintains an Overweight rating on the shares with a price target of $11.50. Following the announcement, the stock was down approximately 1%, trading near $7.64 during Thursday morning sessions, reflecting investor caution in response to the weaker-than-anticipated financial results.

In a separate development aimed at returning value to shareholders, on March 19, the board of directors of Arcos Dorados Holdings Inc. (NYSE:ARCO) authorized a cash dividend for 2026, distributing a total of $0.28 per share to holders of both Class A and Class B shares. This dividend will be delivered in four equal payments of $0.07 per share, scheduled for April 2, June 26, September 25, and December 29. Eligible shareholders will be those recorded on the company’s books as of March 30, June 22, September 21, and December 23, respectively. The structured installments ensure consistent returns to investors throughout the year, reflecting the company’s commitment to providing shareholder value while maintaining transparency regarding the dividend schedule.

Arcos Dorados Holdings Inc. (NYSE:ARCO) is the largest independent McDonald’s franchisee, operating and licensing McDonald’s restaurants across Latin America and the Caribbean, providing food service, franchise management, and brand operations to millions of customers.

7. Worthington Steel, Inc. (NYSE:WS)

Number of Billionaire Holdings: 9

Forward PE Ratio: 13.07

Worthington Steel, Inc. (NYSE:WS) is one of the cheap stocks to buy on our list.

TheFly reported on March 27 that KeyBanc adjusted its price target for WS downward to $38 from $46 while maintaining an Overweight rating on the stock. The revision follows weaker-than-expected third-quarter results and an approximate 15% decline in the share price. The firm also lowered its fiscal 2026 earnings-per-share forecast due to continued pressure from tight galvanized spreads and reduced its fiscal 2027 EPS estimate, anticipating slower spread recovery and slightly lower production volumes after 2026.

Earlier on March 25, Worthington Steel, Inc. (NYSE:WS) released its financial results for the third quarter of fiscal 2026, ending February 28. The company recorded net sales of $769.8 million, up 12% from the prior-year quarter, driven by higher direct volumes and increased average selling prices, partially offset by lower toll volumes.

The business also reported that its operating income fell to $3.1 million from $18.3 million, while net earnings attributable to controlling interest were $10.4 million, or $0.20 per diluted share. Adjusted net earnings came to $13.6 million, or $0.27 per diluted share. The company also declared a quarterly dividend of $0.16 per share payable June 26, 2026, and advanced a public tender offer to acquire Kloeckner & Co SE, with completion expected in the second half of 2026.

Worthington Steel, Inc. (NYSE:WS) is a U.S.-based diversified metals manufacturing company producing steel and metal products, including pressure cylinders, industrial steel, and fabricated steel solutions for automotive, construction, and industrial markets worldwide.

6. Hillman Solutions Corp. (NASDAQ:HLMN)

Number of Billionaire Holdings: 10

Forward PE Ratio: 14.15

Hillman Solutions Corp. (NASDAQ:HLMN) is one of the cheap stocks to buy on this list.

TheFly reported on March 20 that HLMN received a Buy rating from Stifel, with the firm reducing its price target to $12 from $12.20. After attending Hillman’s first investor day, the firm expressed an overall positive outlook on the company’s prospects.

In a significant operational development, on March 26, Hillman Solutions Corp. (NASDAQ:HLMN), a provider of hardware and merchandising solutions, was honored with the James A. Wuenker Growth Award by REDI Cincinnati. The recognition highlights HLMN’s Forest Fair Mall Redevelopment Project, which consolidates several of its Cincinnati-area operations into a single 715,000-square-foot multipurpose facility in Forest Park, Ohio. The development is designed to improve collaboration and operational efficiency, with Hillman as the sole tenant.

The award, presented at REDI Cincinnati’s Annual Meeting and Awards Ceremony, acknowledges projects that strengthen the local economy and promote long-term regional growth. HLMN’s initiative demonstrates its commitment to the Cincinnati area and its strategic focus on sustainable development. Demolition of the former mall is nearly complete, with construction of the new facility slated to start later in the year. HLMN was among four organizations selected from 17 projects reviewed by regional economic development experts.

Hillman Solutions Corp. (NASDAQ:HLMN) is a U.S.-based company that designs, sources, and distributes hardware products, fasteners, and home improvement solutions to retailers, offering a broad range of everyday items for residential and commercial use.

5. TIC Solutions, Inc. (NYSE:TIC)

Number of Billionaire Holdings: 11

Forward PE Ratio: 13.69

TIC Solutions, Inc. (NYSE:TIC) is one of the cheap stocks to buy.

TheFly reported on March 26 that JPMorgan lowered TIC to an Underweight rating from Neutral and reduced its price target to $7 from $8. The adjustment reflects expectations of limited near-term growth compared with industry peers, rather than concerns about the company’s long-term prospects. The firm also noted potential challenges related to operational execution, margin pressures, and the integration of NV5.

Earlier on March 12, TIC Solutions, Inc. (NYSE:TIC) released its financial results for the fourth quarter and full year 2025, reflecting the impact of the NV5 merger and the earlier Acuren acquisition. The company reported 2025 combined annual revenue of approximately $2.1 billion, with a fourth-quarter revenue of $508.3 million, while achieving adjusted EBITDA growth of 87% year-over-year for the quarter.

The results showed a net loss of $47.2 million in Q4 and $87.1 million for the full year. The reporting periods accounted for the phased integration of NV5 and operational consolidation. TIC highlighted continued strength in consulting engineering and geospatial services, alongside disciplined pricing and project selection to maintain long-term margin quality. The business also announced a $200 million share repurchase program, providing flexibility to enhance shareholder value while advancing its strategic priorities.

TIC Solutions, Inc. (NYSE:TIC) is a tech‑enabled provider of testing, inspection, certification, and compliance (TICC), engineering and geospatial services that help ensure the safety, reliability and efficiency of critical industrial assets and infrastructure across North America.

4. Oddity Tech Ltd. (NASDAQ:ODD)

Number of Billionaire Holdings: 12

Forward PE Ratio: 14.26

Oddity Tech Ltd. (NASDAQ:ODD) is one of the cheap stocks to buy now.

TheFly reported on March 27 that Goldman Sachs kept ODD at a Neutral rating while reducing the price target to $16 from $20. The adjustment reflects higher projected expenses driven by rising oil costs and softer demand signals observed from industry channels, according to the firm’s research update.

Earlier on February 25, Oddity Tech Ltd. (NASDAQ:ODD) announced its fourth-quarter and full-year 2025 financial results, highlighting record performance despite operational challenges. The company achieved double-digit revenue growth driven by strong sales from IL MAKIAGE and SpoiledChild, while successfully launching its third brand, METHODIQ. Total cash, cash equivalents, and investments reached $776 million, and the company amended credit agreements to secure $350 million in credit facilities.

ODD also noted a disruption with its largest advertising partner, resulting in elevated new user acquisition costs, though corrective measures have been implemented to restore efficiency later in 2026. Fourth quarter metrics exceeded guidance across revenue, gross margin, adjusted EBITDA, and adjusted EPS. The company maintained its strategic focus on long-term growth and customer retention, supported by robust repeat purchase rates. ODD continues to pursue opportunistic share repurchases, with $103 million remaining under its $150 million authorization, aimed at returning capital to shareholders while advancing its growth initiatives.

Oddity Tech Ltd. (NASDAQ:ODD) operates as a consumer tech company that builds digital-first brands for the beauty and wellness industries in the United States, Israel, and internationally.

3. Power Solutions International, Inc. (NASDAQ:PSIX)

Number of Billionaire Holdings: 12

Forward PE Ratio: 12.91

Power Solutions International, Inc. (NASDAQ:PSIX) is one of the cheap stocks to buy now.

TheFly reported on March 24 that Jefferies kept PSIX at a Buy rating while lowering the price target to $92.90 from $110.51. The revision follows the company’s fourth-quarter results and reflects management’s focus on improving facility utilization after expanding operations in Wisconsin.

Separately, earlier on March 2, Power Solutions International, Inc. (NASDAQ:PSIX) completed the acquisition of MTL Manufacturing & Equipment Inc., a metal and steel manufacturer based in Beloit, Wisconsin, near PSI’s enclosure facilities. MTL produces a variety of fabricated products, including switchgear subbases, electrical enclosure assemblies, and fuel tanks for large power generation systems, and offers full engineering capabilities alongside vertically integrated manufacturing.

The company holds multiple certifications, such as UL142, ULC S601, and UL2085, and operates over 185,000 square feet of advanced manufacturing space across two locations. The acquisition, funded through PSI’s cash reserves and certain equipment-related debt, is designed to strengthen PSIX’s position in the data center market by improving supply chain control, reducing lead times, and leveraging MTL’s specialized production and certifications. MTL’s management team will continue to oversee operations, ensuring continuity while combining the strengths of both companies to meet growing demand for high-quality, reliable power solutions.

Power Solutions International, Inc. (NASDAQ:PSIX) is a provider of integrated energy products and services, including batteries, fuel cells, and backup power systems, serving industrial, commercial, and utility customers with reliable energy storage and power solutions.

2. WisdomTree, Inc. (NYSE:WT)

Number of Billionaire Holdings: 14

Forward PE Ratio: 12.45

WisdomTree, Inc. (NYSE:WT) is one of the cheap stocks to buy on this list.

TheFly reported on March 26 that Oppenheimer kept WT at an Outperform rating while lowering the price target to $20 from $21. The adjustment follows WisdomTree’s announcement of its planned acquisition of U.K.-based Atlantic House Holdings, a private fund manager specializing in derivatives-driven products, for approximately $200 million. The firm expects the deal to expand WT’s product offerings, including “defined outcome” investments, and to create opportunities to cross-sell investment products across Europe and the U.S. Oppenheimer anticipates that the acquisition will also enhance diluted earnings per share, viewing the transaction as both strategically and financially beneficial.

Adding to that, on March 24, the company made an announcement of a private offering of $525 million in 4.50% convertible senior notes due 2031 to qualified institutional buyers. The initial purchasers exercised their full option to acquire an additional $78.75 million, bringing the total offering to $603.75 million. Net proceeds of approximately $591.2 million are expected, with roughly $200 million allocated to fund the Atlantic House Holdings acquisition, $302.7 million used to exchange 3.25% convertible senior notes due 2029, and the remainder available for working capital, debt repayment, or general corporate purposes.

WisdomTree, Inc. (NYSE:WT) is a global financial innovator and asset manager that sponsors exchange‑traded products (ETPs), ETFs, and digital asset solutions, offering investment and advisory services to help investors access transparent, diversified markets. It also develops blockchain‑enabled products and next‑generation financial infrastructure.

1. Winnebago Industries, Inc. (NYSE:WGO)

Number of Billionaire Holdings: 15

Forward PE Ratio: 13.29

Winnebago Industries, Inc. (NYSE:WGO) is among the best cheap stocks to buy.

TheFly reported on March 27 that Roth Capital adjusted its price target for WGO down to $38 from $42 while keeping a Neutral rating. The update follows the company’s Q2 results, which surpassed expectations, though geopolitical tensions in Iran have created added uncertainty for this year’s selling season. The firm noted that WGO is focusing on factors within its control, including revitalizing its legacy motorized operations, but Roth is positioning its forecast near the lower end of management’s guidance.

On March 25, Winnebago Industries, Inc. (NYSE:WGO), a major manufacturer of outdoor recreation products, released its second-quarter fiscal 2026 results for the period ending February 28, 2026. The company reported net revenue of $657.4 million, up from $620.2 million in the same quarter last year, with gross profit of $85.6 million and a 13.0% margin.

The corporation’s net income reached $4.8 million, or $0.17 per diluted share, while adjusted EPS increased to $0.27. Adjusted EBITDA totaled $24.4 million, reflecting a 7% year-over-year gain. Leadership highlighted disciplined operations, selective pricing, and product mix improvements, alongside efforts to strengthen the balance sheet, including a $100 million redemption of Senior Secured Notes during the quarter.

Winnebago Industries, Inc. (NYSE:WGO) is a U.S. manufacturer of recreational vehicles (RVs) and outdoor lifestyle products, known for travel trailers, motorhomes, and towable units that support mobile living and adventure.

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