The FTSE SmallCap Index of UK shares has increased around 6% in the year to date. That’s a pretty decent return given the uncertain outlook facing Britain’s small-cap companies, of which a large number of risers are volatile but high-growth penny stocks.
Yet, despite these robust gains, many penny shares still look brilliantly cheap at current prices. Here are three I think demand particularly serious consideration today.
Alternative Income REIT
Alternative Income REIT (LSE:AIRE) is an outlier in the broader penny stock complex. Rather than growth, its focus is on delivering strong and sustainable passive income to investors.
Its exceptional value still warrants a close look from small-cap investors, though. The real estate investment trust (REIT) trades at a 15% discount to its net asset value (NAV) per share.
Continuing the dividend income theme, the trust’s forward dividend yield is an enormous 8.6%.
Alternative Income’s share price has flatlined in 2025 due to growing pessimism over future interest rate cuts. Higher rates create more pressure given the REIT’s high debt levels.
Yet, I think this is more than baked into the trust’s low valuation. I like its diversification across sectors including retail, residential, and healthcare helps reduce risk. It also has tenants tied down on long contracts, further insulating it against tough economic conditions.
As of June, the REIT’s leases had an average remaining term of 15.6 years to the earliest break and expiry date.
Everyman Media Group
Cinema operator Everyman Media Group (LSE:EMAN) has dropped 22% in value in the year to date. This reflects concerns over UK consumer spending power, combined with particular uncertainty over the cinema industry as viewing habits change.
These worries merit serious attention, but so does the showstopping value that Everyman shares now offer. The leisure giant trades on an enterprise value (EV) to revenues ratio of just 0.4. Meanwhile, its EV to EBITDA ratio is a modest 2.8 times.
I think this penny share’s well placed to weather sector problems and grow long-term profits. It offers more than the bog-standard multiplex cinema, with its sites also incorporating bars and restaurants to encourage people from their sofas. This gives it added scope to grow revenues and sustain itself in the streaming age.
Agronomics
Agronomics (LSE:ANIC) has been one of the best-performing penny shares in the year to date. The company invests in more than 20 early-stage businesses that make food and clothing from animal and plant cells.
It’s risen almost two-thirds in value so far in 2025. And yet it still trades at a 57% discount to its NAV per share.
Investing in smaller companies allows Agronomics to seize early mover opportunities. Major holdings here include lab-grown chicken manufacturer SuperMeat and plant-based meat producer LiveKindly.
On the downside, this also increases risk. Acquisitions can throw up nasty surprises that erode shareholder value. However, I think the potential long-term rewards of its strategy may outweigh these dangers. Agronomics reckons its market could be worth more than £200bn by 2040 as phenomena like climate change and ethical awareness drive growth.
