Summary
- Penny stocks are low on investor’s pocket thus can be purchased in bulk.
- There are many penny stocks with strong fundamentals, and which also possesses solid growth prospect.
There is a famous saying, “Big things often have small beginnings”. This quote proves right for some penny stocks. Penny stocks are stocks that trade at very low prices in UK its less then £1.00, have low market capitalisation and are low on liquidity. The reason for low liquidity is the difference between their bid and ask price on the stock exchange, and thus, stock ends up with low trading volumes.
Low price helps investors to purchase Penny Stocks in bulk. These stocks are suitable for risk taker or risk lover investors as the probability of generating a return is high compared to blue-chips stocks. But once the company start performing, they act as a wealth multiplier and can give an unexpected return. There are many companies where the fundamentals are also strong and have solid growth prospect.
Also read: Penny stocks-Risks and rewards of investing in low market cap shares
Here we are putting our lens through 5 penny stocks, which in the last one year have given gargantuan return to their investors.
Carclo PLC (LON: CAR)
A technology-led plastic business company, Carclo PLC is a provider of customised engineering services in the field of Medical, Optical, aerospace and electronics. The company’s both aerospace and technical plastic divisions showed resilient performance in this pandemic.
For H1 2021, the company’s revenue stood at £50 million, down by 11% in comparison to the same period last year. Carclo reported a £0.9 million statutory loss before tax in H1 2021 as compared to £5.6 million in H1 2020. The group successfully reduced its debt position to £24.4 million as of 30 September 2020 (excluding IFRS 16 lease liabilities), which was £26.8 million a year ago.
On May 24, 2021, the stock was at GBX 68.00 and has given a return of over 1180% in the last one year.
MobilityOne Ltd (LON: MBO)
An AIM-listed company provides payment solution for e-commerce infrastructure. Backed by its strong bill payment business in Malaysia, the company’s revenue increased to £119.9 million, up by 51.9% for H1 ended 30 June 2020. Cash and cash equivalents increased by £0.93 million as of 30 June 2020 compared to last year. The company has a market capitalisation of around £35 million.
On 24 May 2021, the stocks of the company were trading at GBX 32.5 as of 10:58 AM GMT +1, down by 1.52%. The stock has given a return of over 1063% in the last one year.
Wishbone Gold PLC (LON: WSBN)
The company from the precious metal sector operates in Dubai and UAE. As impacted by COVID, the company’s total sales decreased to US$3.637 million as against US$6.562 million for the six months ended 30 June 2019. As of 30 September 2020, the company’s net assets were US$1.582 million from US$0.89 million a quarter ago. Wishbone Gold has a market capitalisation of around £23 million.
On 24 May 2021, the stocks of the company were trading at GBX 15.25 as of 11:18 AM GMT +1, up by 10.91%. The stock has given a return of over 935% in the last one year.
Maestrano Group PLC (LON: MNO)
A software and hardware specialist, Maestrano Group is a UK based software company that has its operations in Australia, the US, UK, and UAE. Based on its unaudited results for the Q3, the company reported an increase of 1% in its quarterly revenue to £0.3 million, though down 6% on a constant currency basis as of 31 March 2021.
The company delivered the first milestone of the SBRI (Network Rail UK) project in March 2021. The company is optimistic about its Q4 performance as Q3 was affected by a significant weather event in Australia.
MNO stocks were at GBX 14.25 as of 24 May 2021. The stock has given a return of over 622% in the last one year.
Escape Hunt PLC (LON: ESC)
Escape Hunt PLC, a company from the hotel and entertainment service sector, is an AIM-listed company and has around £39 million of market capitalisation. The company has expanded its estate in 14 cities by 56%, Watford is one of them.
Despite the COVID-19 lockdown, the company reduced its Group Adjusted EBITDA loss to £1.4 million as compared to £1.7 million in 2019. However, its revenue decreased by 46% and stood at £2.7 million as of 31 December 2020. The company holds cash of £3.3 million as of 31 March 2021.
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