Small-Cap Rally Highlights Insider Buys and Risks

U.S. markets have hit record highs and a recent Federal Reserve rate cut has coincided with a small-cap rally that lifted the Russell 2000. Analysts say investors can still find value in small-caps showing insider buying, highlighting community bank Burke & Herbert (market cap about $0.44 billion), where an insider purchased 6,000 shares amid improving Q2 results and a projected 6.3% annual earnings growth. Some Asian small-caps, such as Amotiv, saw insider buying but reported a fiscal-year loss, high debt and volatile fundamentals, underscoring mixed prospects. Research platforms warn that names including PubMatic and Fresh Del Monte exhibit weak retention, projected sales declines, rising expenses and low margins, while some large-caps like Western Digital and Starbucks face near-term headwinds from falling sales and margin pressure. For downside protection, analysts point to recession-resistant consumer names such as Church & Dwight for steady demand and a long dividend-growth record.