Buying penny stocks can be a wild ride for UK share investors. Their low cost means bouts of extreme share price volatility can be commonplace. But so what? As a long-term investor, I for one am not discouraged from buying ultra-cheap stocks. This is because quality stocks tend to rise in value over a period of years, regardless of what they cost initially.
Here are what I think could be some of the best penny stocks to buy for the next 10 years.
One cheap UK share on my radar
I fully expect Assura to provide decent stress-free returns for the next decade at least. This penny stock invests in and rents out primary healthcare facilities in the UK.
Not only can this UK share expect demand for its properties to keep rising as a rapidly-ageing population drives healthcare services usage. But the company remains committed to its successful acquisition strategy in order to drive future earnings.
Besides, investors in Assura don’t need to be concerned about the impact of economic crashes on its profits, given the ultra-defensive sector in which it operates. I’d buy this stock despite the fact that an acquisition-led growth strategy can create a multitude of problems like disappointing revenues and ballooning costs.
A penny stock in top shape
Glanbia is another penny stock I’d happily buy today to own for the next 10 years. This is because the sports nutrition market is expected to continue growing rapidly, a sector in which it manufactures ingredients for and services directly through brands such as Optimum Nutrition.
Statista, for example, thinks the global sports nutrition and supplements market will be worth $35.4bn by 2025. That compares with the $13.9bn it was worth in 2018.
Indeed, business is already booming at Glanbia. Like-for-like sales at its Performance Nutrition and Nutritionals units leapt 14.1% and 7.9% respectively in the three months to 3 April. I’d buy this UK share despite the rising popularity of veganism and the threat this poses to its dairy operations.
Get in the fast lane
A bright outlook for the sports car markets means Surface Transforms also has a very bright future indeed. Okay, demand for luxury and fast cars took a smack in 2020 as the Covid-19 crisis took hold.
And there’s the possibility of the public health emergency blowing up again, posing a risk to carmakers and parts manufacturers in the short-to-medium term.
However, over a longer time horizon, the outlook remains pretty exciting. That’s because the number of millionaires (and billionaires) is tipped to grow. Analysts at Knight Frank think the number of ultra-high net worth individuals ($30m+) will soar 27% in the five years to 2025.
It’s a trend which performance brake manufacturer and penny stock Surface Transforms stands to benefit greatly from.
Royston Wild has no position in any of the shares mentioned. The Motley Fool UK has recommended Glanbia. 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.