I’ve been searching for the best penny stocks to buy in the New Year. Here’s a quartet that could supercharge investor returns.
Accrol Group Holdings
Tissue product manufacturer Accrol supplies discount stores and supermarkets which sell its products under their own brands. This could make it an ideal stock to buy as the cost-of-living crisis endures.
People are turning away from more expensive branded tissue products to save money. Accrol’s revenues leapt 64% in the three months to October as a result. And its market share by volume grew two percentage points to 21.5%.
The penny stock could prove to be a top long-term pick too. The value segment has been growing rapidly in recent years as consumers become savvier with their money.
I’d buy Accrol even though rising paper costs could damage profits growth.
Michelmersh Brick Holdings
Construction product suppliers like Michelmersh will be well-placed to ride Britain’s upcoming housebuilding boom.
The UK is suffering from a colossal housing shortage. At the same time, its population continues to rapidly grow. So residential property creation will have to ramp up significantly over the next decade. London alone needs up to 100,000 new homes each year, recent research suggests.
Michelmersh remains committed to grow its position in this exciting market through acquisitions too. Last month, it purchased pre-built brick product specialist Fabspeed for £6.25m.
Profits at the brickmaker could suffer if energy prices remain elevated however.
Berkeley Energia
Nuclear power demand is tipped to surge as the world transitions from fossil fuels. The International Atomic Energy Agency thinks nuclear could account for 14% of global electricity by 2050, up from 10% today.
Uranium producers like Berkeley Energia could be in the box seat to exploit this growth. This particular penny stock operates Spain’s Salamanca project, a resource that could produce a gigantic 4.4m tonnes of the radioactive material a year.
But the miner faces a huge obstacle to serious profits growth. Just over a year ago, the Spanish government rejected the firm’s plans to build a uranium concentrate plant at the site.
Berkeley is taking steps to have the decision reversed. So I’ll be watching developments in the months ahead with a view to opening a position in the share.
Gensource Potash
The world’s population is climbing at an incredible rate. According to the UN there will be 9.7bn people around in 2050. That’s a lot of mouths to feed, meaning fertiliser demand will also rocket in the decades ahead.
This bodes well for Gensource Potash, a penny stock that is developing the Tugaske project in Canada. It has an off-take agreement in place with German chemicals giant (and investor) Helm to supply 100% of its eventual production.
Gensource and its investing partner certainly have a bullish view of the potash market. In June, they announced plans to double output capacity at Tugaske to 500,000 tonnes per year. Soaring fertiliser prices and constrained market supply were cited as reasons behind the decision.
Be aware though that project development problems could see Gensource’s share price slump.
