I think these low-cost stocks could help me make spectacular returns. Here’s why I’d buy these ‘nearly’ penny stocks right now. Each costs less than 150p.
The relentless growth of e-commerce means that Macfarlane Group’s labels and packaging products should remain in high demand. The business designs, makes and distributes generic and bespoke packing materials which it sells in the UK and Europe. It also sells its labels in the US. It therefore has considerable strength through geographic diversification.
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Its operations might not be the most exciting but they serve an important part of everyday life. Researchers at Statista think the global e-commerce market will be worth $6.39trn by 2026, up from $4.89trn last year. Despite the threat posed by rising raw material prices I think Macfarlane’s could be a great buy for the online shopping boom.
A high-energy stock
I also believe VH Global Sustainable Energy Opportunities could be a great investment for me for the next 10 years. This near-penny stock allows UK share investors to make money from rising global demand for green energy. According to the International Energy Agency, 95% of the increase in global power capacity to 2026 will come from renewables.
VH Global invests in different low-carbon technologies across the globe. In recent months, it’s acquired new solar assets in Australia and Brazil, for example. I’d buy VH Global even though the highly-regulated nature of its operations could throw up profit-sapping obstacles at any time.
Bakk in business
Bakkavor Group’s in the box seat to enjoy recovering demand for ‘on the move’ food. It makes salads, sandwiches and bakery products and it has expanded into the US and China to exploit these fast-growing markets.
According to IGD, the food-to-go market will command a 23% share of the total food sector by 2026. That compares with the 21% take it was said to have commanded last year.
Demand for ready-made food is soaring as people’s lifestyles become busier. This is a theme that looks set to continue for the foreseeable future. My only concern with buying Bakkavor shares is the possible return of Covid-19 lockdowns if infection rates spike. This would naturally hit demand for its edible products hard.
A highly-stable ‘nearly’ penny stock
I actually think Residential Secure Income should thrive even if the pandemic rolls on. As the name suggests, this business generates income by letting homes, a property segment which history suggests should remain robust whatever economic, political or social crisis comes along.
But this UK share is far from boring. I think this ‘nearly’ penny stock could deliver strong profits growth this decade. Britain’s shortage of affordable rental properties looks set to run and run.
I also like Residential Secure Income’s exposure to the fast-growing shared ownership market. I’d buy the business even though Bank of England plans to loosen mortgage affordability could hit broader demand for rented accommodation.