Are these two UK penny stocks the best shares to buy right now?

Penny stocks may not be every investor’s cup of tea, but I believe these two are among the best shares to buy right now for high growth.

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Penny stocks are not all the fun and games that movies like The Wolf of Wall Street would have us believe. Yet many investors mistake penny stocks for small companies. Therefore, they believe their bets to be riskier than blue-chip investments. That’s not always the case though, as I’ve seen with these two top UK penny stocks. 

Foxtons

The first of my two British penny stocks to buy right now is Foxtons  (LSE: FOXT). This UK business is an estate agency that deals with both lettings and sales. In the past 12 months, the stock price has soared 52% from 43p to 65p.  These solid returns have come as a result of the UK’s ongoing housing boom.

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In its latest financial update in early March, the group said trading in the first two months of 2021 was “well ahead” of the prior-year period. It added that the pipeline of sales commissions was more than 30% higher than the same period in 2020. Foxtons posted total revenues of £93.5m for 2020, down from £106.9m in 2019. Not the worst scenario considering the pandemic massively impacted its first-half sales in 2020. The FTSE 250 company is still a big name in estate agency and could have its best chance to regain some former glory by capitalising on current market trends. 

This penny stock is not without controversy though. It has come under fire for its decision to award Nic Budden, its chief executive, a £1m bonus. This decision was widely criticised as it came with the company benefiting from almost £7m of government Covid support, including £4.4m from the furlough scheme. This black mark for the firm has done nothing to enhance its reputation. 

Despite that, I believe this to be a blip on the radar for Foxtons. The potential for growth outweighs the risk for me, so I’ve added it to my shortlist.

N Brown

Another top UK investment right now, I feel, is N Brown Group  (LSE: BWNG). It’s an online clothing retailer that focuses on larger-sized and 50+ customers. Penny stock or not, I think this recovery stock is a great bet for me. Its share price is up more than 300% in the past 12 months, from 16p to 67p. 

N Brown’s switch to an online retail-only model in 2018 has greatly reduced leasing costs. And due to the rapid acceleration of online retail in 2020, N Brown was able to capitalise immediately. By removing its bricks-and-mortar business entirely, it can also increase its margins. It has also been helped by Britain’s average waistline getting larger, and its population ageing. I believe that N Brown’s core market is only going to grow.

However, before the pandemic, N Brown posted a 2019 loss of £58m, showing that it has struggled with profitability. And although it appears to be on the rise, that can change overnight in such a fickle industry as fashion retail. The increased competition might simply be too much. I’m certainly taking a risk if I add it to my portfolio.

That’s a risk I believe is worth taking though as, despite recent gains, I think it has more room to grow. With an ever-increasing target market and recent boons in online retail, the sky’s the limit, in my opinion.

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Jamie Adams holds no position in any stocks mentioned above. The Motley Fool UK has no position in any of the shares mentioned. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.

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