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Interested in the potential growth opportunities that the micro-cap sector can offer? For ideas on where to start, we ran a screen.

We began by screening for micro-cap stocks with market caps between $50-300 million. We screened these names for those that appear undervalued relative to earnings growth, with PEG below 1.

We then screened for those with the most significant buying interest from smart money investors: significant net institutional purchases over the current quarter and significant net insider purchases over the last six months.

Interactive Chart: Press Play to compare changes in analyst ratings over the last two years for the top six stocks mentioned below. Analyst ratings sourced from Zacks Investment Research.

We also created a price-weighted index of the stocks mentioned below, and monitored the performance of the list relative to the S&P 500 index over the last month. To access a complete analysis of this list's recent performance, click here.

Do you think these names will outperform like the smart money expects? Use this list as a starting point for your own analysis.

1. Alpha & Omega Semiconductor, Ltd. (AOSL): Engages in the design, development, and supply of a range of power semiconductors worldwide. Market cap at $244.08M. PEG at 0.53. Net institutional purchases in the current quarter at 975.2K shares, which represents about 5.69% of the company's float of 17.13M shares. Over the last six months, insiders were net buyers of 41,229 shares, which represents about 0.24% of the company's 17.13M share float.

2. Barrett Business Services Inc. (BBSI): Offers various human resource management services to small and medium-sized businesses in the United States. Market cap at $168.33M. PEG at 0.41. Net institutional purchases in the current quarter at 222.6K shares, which represents about 3.49% of the company's float of 6.38M shares. Over the last six months, insiders were net buyers of 31,397 shares, which represents about 0.49% of the company's 6.38M share float.

3. Hawaiian Telcom Holdco, Inc. (HCOM): Provides various telecommunication services to business and residential customers in Hawaii. Market cap at $160.19M. PEG at 0.36. Net institutional purchases in the current quarter at 1.5M shares, which represents about 24.% of the company's float of 6.25M shares. Over the last six months, insiders were net buyers of 29,550 shares, which represents about 0.47% of the company's 6.25M share float.

4. Hardinge Inc. (HDNG): Engages in the design, manufacture, and distribution of machine tools. Market cap at $114.62M. PEG at 0.32. Net institutional purchases in the current quarter at 388.0K shares, which represents about 3.5% of the company's float of 11.07M shares. Over the last six months, insiders were net buyers of 5,000 shares, which represents about 0.05% of the company's 11.07M share float.

5. Multimedia Games Inc. (MGAM): Engages in the development and supply of comprehensive systems, content, electronic games, and player terminals for the casino, charity, international bingo, and video lottery markets in the United States and Internationally. Market cap at $277.23M. PEG at 0.74. Net institutional purchases in the current quarter at 2.1M shares, which represents about 8.68% of the company's float of 24.19M shares. Over the last six months, insiders were net buyers of 25,000 shares, which represents about 0.1% of the company's 24.19M share float.

6. QC Holdings, Inc. (QCCO): Provides various retail consumer financial products and services in the United States. Market cap at $62.22M. PEG at 0.32. Net institutional purchases in the current quarter at 293.4K shares, which represents about 7.58% of the company's float of 3.87M shares. Over the last six months, insiders were net buyers of 150,150 shares, which represents about 3.88% of the company's 3.87M share float.

7. Xerium Technologies Inc. (XRM): Engages in the manufacture and supply of consumable products used in the production of paper primarily in North America, Europe, South America, and the Asia-Pacific. Market cap at $121.42M. PEG at 0.38. Net institutional purchases in the current quarter at 451.8K shares, which represents about 6.35% of the company's float of 7.11M shares. Over the last six months, insiders were net buyers of 322,952 shares, which represents about 4.54% of the company's 7.11M share float.

*Insider data sourced from Yahoo! Finance, institutional data sourced from Fidelity, all other data sourced from Finviz.

Source: 7 Undervalued Micro-Cap Stocks Being Bought By Hedge Funds And Insiders