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3 penny stocks I’d buy in my ISA and look to hold until 2030

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Here are three top penny stocks I think could deliver excellent long-term shareholder returns. This is why they’re on my Stocks and Shares ISA shopping list today.

A penny stock for the construction boom

The homes shortage that’s driving prices in the UK through the roof (so to speak) isn’t confined to our corner of Europe. Naturally, this means homebuilders on the continent need to get frantically building too. And this plays into the hands of SIG, a building products supplier with operations in Northern and Eastern Europe.

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This penny stock’s share price just spiked to 14-month peaks around 47p per share. And I reckon it can keep rising as it recovers from 2020’s washout (like-for-like sales rose 4% in the last three months of last year). That said, there’s a risk the Covid-19 ‘third wave’ sweeping across Europe could snap off these green shoots of recovery.

A golden oldie

I believe Old Mutual (LSE: OMU) — which trades at 66p per share — is another top penny stock for long-term investors like me. I believe having exposure to fast-growing emerging markets is a great strategy for UK share investors. And this particular life insurance provider concentrates on exciting African markets south of the Sahara. These are territories in which insurance demand looks on course to boom.

American research group Brookings says that, prior to the pandemic, the African insurance market was set to grow at around 7% per year between 2020 and 2025. It noted: “This projection placed the African insurance market’s growth at approximately twice the rate of North America, more than three times the rate of Europe, and slightly higher than Asia’s 6% growth rate.”

Brookings also notes that the pandemic has delayed the continent’s insurance growth pattern rather than altered it, meaning operators like Old Mutual still have a very bright future. That said, be aware that competition here is rising as overseas operators try to get in on this lucrative territory.

Property powerhouse

I believe that investing in the student accommodation sector could be a good idea too. This is why I’d happily add Empiric Student Property (LSE: ESP), which trades at 88p per share, to my own ISA. This particular penny stock is one of the country’s largest operators in this part of the real estate market. And while it was battered by the Covid-19 crisis last year — revenues dropped 16% in 2020 as the pandemic smacked occupancy rates and forced it to dole out refunds — the sunny outlook for the sector remains.

In particular, inflows of international students continue to grow at a robust pace. As Savills notes, these particular students are 60% more likely to move into purpose-built student accommodation than homegrown students.

However, any changes to the higher education sector in Britain could damage demand for its digs going forward. But, all things considered, I think this is a great penny stock to buy right now.

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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.

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