3 penny shares to buy in September

We have some tasty-looking updates coming our way in September. Here are three penny shares that look cheap to me, with results due.

| 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 bank notes and coins

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.

Penny shares are those selling for under a pound in the UK. Typically, they’ll also be companies with relatively small market-cap valuations.

Quite a few fitting the bill are due to bring us updates in September. Today, I’m looking at three I think might be worth buying, depending on those figures.

Bricks

Lords Group Trading (LSE: LORD) is in the building materials business. The share price has slumped in 2022, continuing a downward trend since its initial public offering (IPO) on AIM in July 2021. It was an interesting time to float, the year after Covid-19 severely hammered the stock market.

Lord is set to deliver first-half results on 6 September, following July’s trading update. Revenue in the half appeared largely flat, and the company said trading was in line with full-year expectations.

The market expects revenue of £435m, with adjusted EBITDA of £26m. The company also says it’s on track for £500m revenue in 2024.

Why do I think it might be one to buy in September? Investors seem very wary of building-related stocks right now. But we just heard that house prices are up 10% year on year. So Lords might just be undervalued.

Medical

First-half results from EKF Diagnostics Holdings (LSE: EKF) should be here on 20 September. August’s trading seemed positive enough, with things largely in line with 2021.

That seems good to me, considering Covid contributions to medical businesses are declining. The EKF share price has fallen over the past 12 months, presumably as the pandemic factor recedes.

Forecasts suggest a forward price-to-earnings (P/E) ratio for EKF of around 26, which might seem a bit high. But with further predicted earnings growth, that would drop to around 16 by 2024.

EKF is involved in a number of medical diagnostics, from lab-based to point of care in surgeries and clinics. I’m looking for evidence of non-Covid growth potential in the upcoming results. And if I see it, EKF might be one to buy for long-term growth.

Property

I think Regional REIT (LSE: RGL) is worth a closer look, with its shares down nearly 25% in 12 months and falling 33% in five years.

It invests in commercial properties outside of the M25. And considering the wreckage that Covid created, I think that’s actually a reasonably resilient share price performance.

As a real estate investment trust (REIT), it must pay 90% of its rental profits as dividends. The 6.5p paid in 2021 was only just covered by earnings, in a very tough year. But it yielded a very nice 6.9%.

For the current year, the trust has already announced a 3% increase in its latest quarterly dividend, to 1.65p. And forecasts indicate better than 9% for the full year. That suggests confidence, as UK workers increasingly get back to the office. First-half results are due on 15 September.

Penny shares

I’d never buy a penny share just because its price makes it look cheap. And I’d dig into the risks of all these before I made any decision. But I do think results from all of them should be worth investigating.

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.

Alan Oscroft 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

Could the JD Sports Fashion share price double in the next five years?

The JD Sports Fashion share price has nearly halved in the past five years. Our writer thinks a proven business…

Read more »

Bus waiting in front of the London Stock Exchange on a sunny day.
Investing Articles

If interest rate cuts are coming, I think these UK growth stocks could soar!

Falling interest could be great news for UK growth stocks, especially those that have been under the cosh recently. Paul…

Read more »

Investing Articles

Are these the best stocks to buy on the FTSE right now?

With the UK stock market on the way to hitting new highs, this Fool is considering which are the best…

Read more »

Petrochemical engineer working at night with digital tablet inside oil and gas refinery plant
Investing Articles

Can the Centrica dividend keep on growing?

Christopher Ruane considers some positive factors that might see continued growth in the Centrica dividend -- as well as some…

Read more »

Smiling family of four enjoying breakfast at sunrise while camping
Investing Articles

How I’d turn my £12,000 of savings into passive income of £1,275 a month

This Fool is considering a strategy that he believes can help him achieve a stable passive income stream with a…

Read more »

Person holding magnifying glass over important document, reading the small print
Investing Articles

2 top FTSE 250 investment trusts trading at attractive discounts!

This pair of discounted FTSE 250 trusts appear to be on sale right now. Here's why I'd scoop up their…

Read more »

Smiling young man sitting in cafe and checking messages, with his laptop in front of him.
Investing Articles

3 things that could push the Lloyds share price to 60p and beyond

The Lloyds share price has broken through 50p. Next step 60p? And then what? Here are some thoughts on what…

Read more »

Young female business analyst looking at a graph chart while working from home
Investing Articles

£1,000 in Rolls-Royce shares a year ago would be worth this much now

Rolls-Royce shares have posted one of the best stock market gains of the past 12 months. But what might the…

Read more »