5 promising penny stocks at the London Stock Exchange

Summary

  • Many a times, penny stocks are trading at a significant discount to their face value.
  • These stocks have a high risk and reward potential and is generally picked up by investors who have a high appetite for risk.
  • Investing in these stocks requires a keen research effort on the part of an investor, as very less information is available about them in the public domain.

The shares traded at substantial discount compared to their face value are known as penny stocks. They usually attract minimal pricing and hence lure investors who want to get rich by making minimal investment.

One of the reasons for these stocks to trade at such low levels could be because they may be going through a tough financial period.  

Other than that, some unforeseen event could have taken place with the company or a negative news could be in circulation.

Usually penny stocks belong to small companies with a share price below 1 pound.

Many a times, value-investors observe growth potential in them and consider them as good long-term investment option, based on their analysis.

Today we look at five such stocks in the LSE that have the potential to give good returns to investors who are willing and able to take the required risk. 

Eqtec plc (LON: EQT)- This company is a renewable energy company working in the field of waste to energy. The company has garnered significant public interest in its technology to utilize waste to make energy. 

The increased public awareness of the importance of environment protection and reducing carbon footprint has been the driving force of the company. Through the year 2020 the company has been receiving continued support from investors who invest in businesses providing environment protection technology solutions and green energy solutions.

The company’s operations have been significantly less impacted by the pandemic. The company has also expanded its business and partnerships in the United States and is looking to suitably expand in Asia.

Source- Thomson Reuters (six- months performance)

As on 06 November 2020, the shares of Eqtec plc have been trading at GBX 0.48 per share (2.17 PM  GMT+1) gaining 5.00 per cent over previous day’s close.

Galantas Gold Corp (LON: GAL) – Galantas Gold Corporation is a gold mining company owning operating open cast mines near Omagh Tyrone in Northern Ireland. Along with Gold the company also produces by-products Silver and Lead from its mines.

The company has reviewed its old technical reports on its mines and mineralization, which has led to a significant upgrade in their drilling opportunities and mineral content. A detailed report from the company’s side is awaited.

The shares of the company are listed in the AIM segment of the London Stock Exchange as well as on the TSX venture exchange in Canada.

Source- Thomson Reuters (six- months performance)

As on 06 November 2020, the shares of Galantas Gold Corp have been trading at GBX 16.00 per share (1.46 PM GMT+1) losing 3.03 per cent over previous day’s close.

Maestrano Group plc (LON: MNO) – It is a UK based cloud platform, data management, and business analytics providing company, with a focus on transport corridor analytics.

For the quarterly period ending on 30 September 2020 the company has announced a revenue of £436 million which is a growth of 346 per cent over the revenue of £101 million reported for the corresponding previous year quarterly period.

Source- Thomson Reuters (six- months performance)

As on 06 November 2020, the shares of Maestrano Group plc have been trading at GBX 9.75 per share (1.36 PM GMT+1) losing 2.50 per cent over previous day’s close

Strategic Minerals plc (LON: SML) – The company is a Britain domiciled mineral exploration and extraction company, especially interested in strategic metals and minerals. 

The company’s mining assets include Leigh Creek Copper Mine, Cobre Magnetite Stockpile, Redmoor Tin/Tungsten Project, and Central Australian Rare Earths Nickel Sulphide.

In a recent trading update released by the company it has informed that its revenue for the 12-month ending September 2020 was £3.741 million which was a jump of 55.42 per cent over the corresponding period an year back. 

Source- Thomson Reuters (six- months performance)

As on 06 November 2020, the shares of Strategic Minerals plc have been trading at GBX 0.429 per share (2.12 PM GMT+1) gaining 22.83 per cent over previous day’s close

Verditek plc (LON: VDTK) – The company is a UK domiciled photo voltaic technology and carbon capture sequestration solution providing company. 

Given the current push the UK government and the European Union to reduce carbon emissions, the company’s products face an expanding expansive growth market.

The company recently announced a placement of equity shares to raise £3.5 million to procure raw materials for ramping up its production.

Source- Thomson Reuters (six- months performance)

As on 06 November 2020, the shares of Verditek plc have been trading at GBX 8.26 per share (2.21 AM  GMT+1) losing 0.09 per cent over previous day’s close.

The above five are just a few examples of good low value opportunities available on the London Stock Exchange. An investor willing to invest sufficient time and research could be able to identify many such opportunities that might help him create wealth.

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