3 penny stocks I’d buy to own to 2032!

Searching for penny stocks can often lead one to find the hottest growth shares. Here are three I think could enjoy exceptional profits growth over the long term.

| 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.

Dice engraved with the words buy and sell

Image source: Getty Images.

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.

I think these penny stocks could considerably boost my investment returns over the next decade. Here’s why I’d buy them right now.


What it does: Searches for and produces rock phosphate in Africa.
Price: 8.5p per share

Producing enough food to go round is becoming increasingly hard as population levels rise and global warming worsens. It’s why companies like Kropz (LSE: KRPZ) will play a critical role in the food industry in the decades to come.

This penny stock mines for rock phosphate in Africa, the basic material that’s then used to produce phosphate fertilisers. Virtually all of these types of fertiliser are based on rock phosphate, a raw material that Kropz hopes to produce from its Elandsfontein open pit project in South Africa later in 2022.

Kropz also 100% owns the Hinda rock phosphate asset in Republic of Congo. The business has said that the project could be “one of the world’s largest undeveloped sedimentary-hosted phosphate reserves.”

Production problems

Operational news from the firm hasn’t been hugely encouraging recently. In April it warned of production issues at Elandsfontein that would push its first bulk sale of rock phosphate further back into Q2.

This delay also means Kropz has had to raise ZAR58m, it said. It’s done raise this by drawing down remaining funds from a conditional convertible equity facility and by sealing a bridge loan facility.

A big market

Buying mining shares can always be considered risky. Problems at the exploration, mine development and production stages can be commonplace. And as Kropz has shown, this can be particularly problematic for smaller operators with no revenues and fragile balance sheets.

Still, it’s my opinion that this is an attractive penny stock for me to buy. First off, its projects in Africa are potentially world-class assets. And secondly the business could profit considerably from soaring fertiliser demand.

Analysts at Grand View Research think the phosphate fertiliser market will grow from $63.81bn today to a whopping $176.06bn by 2040.

Corero Network Security

What it does: Provides products that protect websites from cyber attacks.
Price: 12.25p per share

The Covid-19 crisis had led to a sea change in employee expectations. In particular demand for more flexibility in regard to working arrangements has taken off. This bodes well for many businesses that supply software and IT services like Corero Network Security (LSE: CNS).

This particular tech stock provides protection against so-called Distributed Denial-of-Service (or DDoS) attacks. These malicious actions work by attacking a website with large amounts of fake traffic to cause a crash.

With more and more people working from home the opportunity for cyber criminals to wreak havoc is growing. Companies are therefore are having to spend huge amounts on tech security to plug their vulnerabilities. Corero itself saw revenues rocket 24% year-on-year in 2021.

A small player

The problem for Corero Network Security is that it’s tiny compared with the industry’s big beasts. Today the penny stock has a market cap a shade above £60m.

Compare this with the multi-billion (and even trillion) dollar valuations that businesses like Microsoft, NortonLifeLock and McAfee command. Corero then has a fraction of the budgets that its US heavyweight rivals have to develop and market their products.

Making great progress

Corero will have to paddle extremely hard to avoid being swept away by the competition. But having said that, I find the rate at which the UK underdog is winning business highly encouraging. And it could continue to impress as the global cybersecurity market rapidly grows.

Researchers at Quince Market Insights think this sector will expand at a compound annual growth rate of 12.5% between now and 2028. They say the cybersecurity industry will be worth a gigantic $418.3bn by then.

US Solar Fund

What it does: Invests in solar farms in the US.
Price: 88 US cents share

Investing in renewable energy stocks is also appealing to me today. I’ve taken the splash in recent weeks by buying shares in solar and wind farm owner The Renewables Infrastructure Group. I’m considering increasing my exposure by snapping up stock in US Solar Fund (LSE: USF) as well.

As the name suggests, US Solar Fund is focused on creating green energy from photovoltaic cells in the States. Its assets can be found predominantly in North Carolina with the remainder in Oregon, California, and Utah.

Favourable locations

The problem with renewable energy is that it’s sometimes more difficult to generate than electricity from fossil fuels. In the case of US Solar Fund, power generation can tumble during cloudy periods. This can have a significant impact on near-term profits and, by extension, shareholder returns.

The good news for US Solar Fund, though is that the four states it operates in receive more sunshine than the national average. The places in which its assets are located are also well distanced from one another. A wide geographic footprint helps mitigate the impact of poor weather in one or two places at group level.

I also like US Solar Fund because of the favourable legislative conditions in the US that makes it easier to operate. In fact President Biden this week announced plans to halve the amount it charges companies to build wind and solar projects on federal land in a bid to boost investment.

A top dip buy

Demand for renewable energy is soaring as public awareness over the climate change issue grows. The West’s need for clean electricity is set to increase further it tries to wean itself off Russian oil in particular.

The US Solar Fund share price has reversed sharply over the past year. And as someone who invests for the long term, this has attracted my attention. It’s my opinion that this penny stock could deliver excellent returns over the next decade and potentially beyond.

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.

Royston Wild 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

Investing Articles

Will it be too late to buy Nvidia stock in March?

NVIDIA stock is up more than 60% since the start of 2024. Our writer considers whether it might still be…

Read more »

Typical street lined with terraced houses and parked cars
Investing Articles

Why did Direct Line shares just soar 27%?

Direct Line shares have jumped more than a quarter in the course of today's trading session. Our writer explains why…

Read more »

Close-up of British bank notes
Investing Articles

These 2 shares are Dividend Aristocrats. Which should I buy this March?

Our writer likes the business model of this pair of FTSE 100 Dividend Aristocrats. So why would he only consider…

Read more »

Frustrated young white male looking disconsolate while sat on his sofa holding a beer
Investing Articles

I bought 49 Unilever shares in June. Here’s what they’re worth today

Harvey Jones bought a modest amount of Unilever shares last summer hoping the stock would soon recover. He's having to…

Read more »

BUY AND HOLD spelled in letters on top of a pile of books. Alongside is a piggy bank in glasses. Buy and hold is a popular long term stock and shares strategy.
Investing Articles

I reckon these shares, potentially 20% undervalued, are Warren Buffett’s type of investment

Oliver Rodzianko thinks Games Workshop is an absolutely stellar investment. As it's potentially undervalued, he reckons Warren Buffett would agree.

Read more »

Calendar showing the date of 5th April on desk in a house
Investing Articles

Great investing habits that can boost my Stocks and Shares ISA

Forget complicated calculations and financial jargon! Our writer uses a few simple habits to build wealth inside his Stocks and…

Read more »

Young Asian woman with head in hands at her desk
Investing Articles

Why has the St. James’s Place share price crashed 30%, after FY results?

The St. James's Place share price has just fallen off a cliff. What could have gone wrong in 2023 that's…

Read more »

Family in protective face masks in airport
Investing Articles

Here’s how much I’d have if I’d bought 1,000 Rolls-Royce shares 10 years ago

Rolls-Royce shares may be flying high this year but that wasn't always the case. I'm calculating how much I'd have…

Read more »