The Motley Fool

3 penny stocks to buy with £1,000

The content of this article was relevant at the time of publishing. Circumstances change continuously and caution should therefore be exercised when relying upon any content contained within this article.

A person holding onto a fan of twenty pound notes
Image source: Getty Images.

Shopping for penny stocks allows me to dig up gems that other risk-averse investors have missed. Providing you’re willing to accept the possibility of some share price turbulence and do some extra research, I think buying low-cost stocks like this could be a good way to build a winning portfolio.

Here are three top-quality penny stocks on my radar today. With £1,000 in my pocket this is why I’d buy them for my investment portfolio.

5 Stocks For Trying To Build Wealth After 50

Markets around the world are reeling from the coronavirus pandemic… and with so many great companies trading at what look to be ‘discount-bin’ prices, now could be the time for savvy investors to snap up some potential bargains.

But whether you’re a newbie investor or a seasoned pro, deciding which stocks to add to your shopping list can be a daunting prospect during such unprecedented times.

Fortunately, The Motley Fool UK analyst team have short-listed five companies that they believe STILL boast significant long-term growth prospects despite the global upheaval…

We’re sharing the names in a special FREE investing report that you can download today. And if you’re 50 or over, we believe these stocks could be a great fit for any well-diversified portfolio.

Click here to claim your free copy now!

Playing the property boom

Trading at OnTheMarket (LSE: OTMP) has exceeded analyst expectations in recent times. The business — which operates the OnTheMarket.com property listings website — is thriving as demand for residential properties soars in the UK. Revenues at the business rocketed 46% year-on-year in the six months to June.

A mix of favourable lending conditions and support for first-time buyers has persisted, and last month the average price rose above £250,000 for the first time, according to Nationwide. I expect homebuyer demand to remain strong in the short-to-medium term too, in spite of upcoming Bank of England interest rate hikes. I’d buy OnTheMarket to exploit this theme, even though listings giants Zoopla and Rightmove pose a significant competitive threat.

Turkish delight

Gold miner Ariana Resources (LSE: ARR) first came to my attention last year when it released a stream of positive exploration updates. Since then, news on its drilling programmes at its assets in Turkey, as well as from the assets of other Eastern Mediterranean mining companies in which it holds stakes, have remained extremely encouraging.

For example, latest drilling action from Venus Minerals in late October — in which Ariana’s stake could rise to 50% as part of an earn-in agreement — revealed that the Kokkinoyia sector at the Magellan gold and zinc project in Cyprus is “significantly more exciting deposit than initially thought.”

While a falling gold price could hit Ariana’s bottom line hard, I still think this penny stock is a great way to get exposure to the safe-haven precious metal.

A penny stock with ambitious plans 

Budget greetings card retailer Card Factory (LSE: CARD) has ambitious plans to turbocharge revenues over the next five years. It plans to generate sales of £600m by financial 2026, up from the current peak of £451.5m recorded in 2020.

I think the business could make a decent fist of reaching this target for a couple of reasons. Firstly, it’s investing heavily in its digital operations to fully exploit the explosion in e-commerce. Secondly, value retail is tipped to be one of the megatrends of the decade as consumers demand more bang for their bucks.

Card Factory might not have things all its own way, of course. Online-only operators like Moonpig could provide a challenge to its growth target. So could fellow low-cost retailers like Cards Direct. But by offering the twin benefits of value and online I still think the penny stock could deliver impressive profits growth.

5 Stocks For Trying To Build Wealth After 50

Markets around the world are reeling from the coronavirus pandemic…

And with so many great companies still trading at what look to be ‘discount-bin’ prices, now could be the time for savvy investors to snap up some potential bargains.

But whether you’re a newbie investor or a seasoned pro, deciding which stocks to add to your shopping list can be a daunting prospect during such unprecedented times.

Fortunately, The Motley Fool is here to help: our UK Chief Investment Officer and his analyst team have short-listed five companies that they believe STILL boast significant long-term growth prospects despite the global lock-down…

You see, here at The Motley Fool we don’t believe “over-trading” is the right path to financial freedom in retirement; instead, we advocate buying and holding (for AT LEAST three to five years) 15 or more quality companies, with shareholder-focused management teams at the helm.

That’s why we’re sharing the names of all five of these companies in a special investing report that you can download today for FREE. If you’re 50 or over, we believe these stocks could be a great fit for any well-diversified portfolio, and that you can consider building a position in all five right away.

Click here to claim your free copy of this special investing report now!

Royston Wild has no position in any of the shares mentioned. The Motley Fool UK has recommended Card Factory and Rightmove. 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.

Our 6 'Best Buys Now' Shares

Renowned stock-picker Mark Rogers and his analyst team at The Motley Fool UK have named 6 shares that they believe UK investors should consider buying NOW.

So if you’re looking for more stock ideas to try and best position your portfolio today, then it might be a good day for you. Because we're offering a full 33% off your first year of membership to our flagship share-tipping service, backed by our 'no quibbles' 30-day subscription fee refund guarantee.

Simply click below to discover how you can take advantage of this.