2 penny shares I would buy now

Our writer highlights two UK penny shares he would consider buying for his portfolio at the moment — and explains his thinking.

| More on:

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.

British Pennies on a Pound Note

Image source: Getty Images

When investing, your capital is at risk. The value of your investments can go down as well as up and you may get back less than you put in.

Read More

The content of this article is provided for information purposes only and is not intended to be, nor does it constitute, any form of personal advice. Investments in a currency other than sterling are exposed to currency exchange risk. Currency exchange rates are constantly changing, which may affect the value of the investment in sterling terms. You could lose money in sterling even if the stock price rises in the currency of origin. Stocks listed on overseas exchanges may be subject to additional dealing and exchange rate charges, and may have other tax implications, and may not provide the same, or any, regulatory protection as in the UK.

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More.

Here are a couple of penny shares I would consider adding to my portfolio at the moment. I like them because, although the shares each trade for less than a pound, I think the underlying businesses look strong.


Car dealership Lookers (LSE: LOOK) has seen an incredible run lately. I have previously explained why it had an outstanding January, with the Lookers share price soaring 39% in a month. Over the past year, the shares are up 153%.

Despite that, they continue to trade as penny shares. Even after the gains, I continue to think Lookers is cheap. The book value of its property is around 78p per share. But the business itself is a key asset on top of its property holdings. The company has seen strong customer demand and expects that last year will result in a record underlying profit before tax. Meanwhile, the recent purchase of almost a fifth of the company by an industry giant suggests that it sees upside to the current Lookers valuation.

Lookers has said it plans to reintroduce its dividend this year. If it does so, that could provide another fillip for the share price. There are risks here, too. For example, tightening demand of new cars could hurt revenues. The costs of dealing with ongoing supply chain challenges could eat into profits.

But with its established dealer brands, property portfolio, and strong business outlook, I continue to see value in Lookers. I would happily buy it for my portfolio at the current share price.


I like the business model of healthcare landlord Assura (LSE: AGR). But last time I looked at the shares I felt that the dividend yield was good, not great. The stock has fallen around 9% since then, making for a 14% decline over the past year. A falling share price has led to an increased yield.

I think that makes Assura more attractive as a possible addition to my portfolio. The shares now yield 4.6%. Assura pays dividends quarterly and has been raising the payout annually, although there is no guarantee it will continue to do so.

In a trading update last month, the company said that it had seen “another strong quarter of progress”. Assura has continued to expand its portfolio. It reckons the healthcare backlog created by the pandemic could increase the need for healthcare facilities, possibly boosting its revenues and profits.

The strategic focus on healthcare is what interests me about Assura. I expect demand for healthcare facilities to remain high for years or decades to come. Tenants such as doctors’ surgeries are likely to pay their rent. So Assura’s growing portfolio could be very lucrative. One risk is increased competition leading to higher prices for new property purchases. That could hurt the firm’s profitability.

But with an attractive asset base, appealing strategic focus, and knocked down share price, I would now happily add Assura to my portfolio.

My move on these two UK penny shares

I would happily consider both of these shares for my portfolio. That is not because they trade as penny shares. Rather, in each case I see an attractive business with the potential to produce long-term profits that could hopefully reward me as a shareholder.

Should you invest, the value of your investment may rise or fall and your capital is at risk. Before investing, your individual circumstances should be assessed. Consider taking independent financial advice.

Christopher Ruane has no position in any of the shares mentioned. 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.

More on Investing Articles

pensive bearded business man sitting on chair looking out of the window
Investing Articles

Would a stock market crash matter?

Christopher Ruane explains why a stock market crash could turn out to be positive, not negative, for a private investor…

Read more »

Investing Articles

Has the Rolls-Royce share price peaked?

After a strong 2023 performance and (so far) in 2024, the Rolls-Royce share price has stuttered in recent days. Christopher…

Read more »

Young mixed-race couple sat on the beach looking out over the sea
Investing Articles

Turning a £20k ISA into a £13,900 yearly second income? It’s possible!

By investing a £20k ISA now using certain basic principles, our writer thinks he could set up a second income…

Read more »

Fans of Warren Buffett taking his photo
Investing Articles

With no savings, I’d follow Warren Buffett’s number one rule to build wealth

Can this one piece of Warren Buffett wisdom really help our writer as he aims to build wealth in the…

Read more »

Storytelling image of a multiethnic senior couple in love - Elderly married couple dating outdoors, love emotions and feelings
Investing Articles

A second income of £1k a month from just £10 a day! How would I do that?

Mark David Hartley considers how to build a second income stream starting from just £10 a day. Is £1,000 a…

Read more »

Warren Buffett at a Berkshire Hathaway AGM
Investing Articles

Turn £8,900 into a £24k annual passive income? Here’s how!

Christopher Ruane applies some investing lessons from billionaire Warren Buffett when explaining how he'd aim to earn sizeable passive income…

Read more »

Young Caucasian woman holding up four fingers
Investing Articles

7%+ dividend yields! 4 FTSE 100 shares for investors to consider buying in April

These FTSE shares offer dividend yields comfortably above the index average of 3.7%. Here's why they could be good passive…

Read more »

Dividend Shares

£10k in an ISA? Here’s how to generate a ton of passive income

Passive income can provide a lot more financial freedom and security. Here’s an easy way to generate some within an…

Read more »