Looking for penny stocks to buy for 2026? Here are three shares that have caught my eye recently and could be worth considering.

Skillcast

First up, we have Skillcast (LSE: SKL). It’s a software company that specialises in compliance solutions and counts the likes of Tesco, Barclays, and Schroders as customers.

There’s a lot to like about this stock as we kick off 2026. For a start, recent results have been strong.

In September, for example, the company reported 18% revenue growth for the first half of 2025. Subscription revenue for the period was up 23%.

Second, profits are rising rapidly. This year, analysts expect net profit to rise about 40%.

Third, the share price is in a strong uptrend. Note that as I write this, it’s near all-time highs meaning that there are going to be no disgruntled long-term holders waiting to break even and sell shares.

I’ll point out that artificial intelligence is possibly a risk here. This technology could help customers develop their own compliance solutions.

All things considered, however, I see a lot of potential.

Made Tech

Another penny stock in the technology space I like the look of right now is Made Tech (LSE: MTEC). This company helps the UK government and regulated industries with digital transformation.

It has also released some good trading updates recently. In December, it told investors that trading for FY26 (the financial year ending 31 May 2026) would be significantly ahead of expectations.

Note that like Skillcast, the company is seeing good results in terms of profitability. This financial year, analysts expect net profit to soar 85%.

A key risk is a cut in tech spending by the UK government. This scenario is a possibility and could lead to less growth for the company.

I think the stock is worth a look though. Note that the company’s valuation is quite low at present.

Ilika

The third stock I want to highlight, Ilika (LSE: IKA), is far more speculative than the first two. Because it doesn’t have any profits.

It could be worthy of further research though. That’s because the company specialises in solid state battery technology – a huge growth market – and it’s aiming to produce batteries for some high-growth markets including miniature medical implants, industrial wireless sensors, and electric vehicles (EVs) in the years ahead.

One thing that interests me is the fact that Ilika says it has very little competition in the miniature battery sector for active implantable medical devices. This could be a big opportunity for the company.

Now, this is the kind of penny stock that could either soar or crash in 2026. For example, if the company signs some major deals for its battery technology, it could do really well. But if it has to raise a ton of money to stay afloat, its share price could sink.

So, it’s not going to be suitable for those who are averse to risk. If an investor has a high risk tolerance, however, I reckon it’s worth a closer look.

The post 3 potentially explosive penny stocks to consider buying for 2026 appeared first on The Motley Fool UK.

As I write just before markets open on Tuesday (26 August), we’re looking at a market cap of £72m and a 40p share price. That represents an 86% gain just since the start of 2025. But before we think too much about what the future might hold, there’s one note of caution.

Back in 2021, the shares reached 280p. So anyone who bought at the peak is now down 85% overall — even after this year’s gain. But new tech like this often needs a second wind to really get started. And AI attracts more attention now than four years ago.

What’s the excitement?

On 18 August, Ilika announced a milestone with US strategic partner Cirtec Medical, a company developing next-generation medical devices. The news release said: “The companies have successfully completed process qualification for the Stereax M300 micro-battery production line at Cirtec Medical’s facility in Lowell, Massachusetts.”

This, apparently, is the final technical validation needed before production can start.

It comes after CEO Graeme Purdy told us at full-year results time in July that “Ilika has achieved a significant number of important technical and commercial milestones over the past twelve months.“

The company’s next major moves include getting its electric vehicle battery technology, Goliath, to viable product status by the end of 2025, which means completing prototypes and getting them to customers for testing.

We should also hopefully see the recognition of Stereax revenues commence in the current calendar year.

A no-brainer buy?

So, is it time to rush out and buy then?

Before anyone considers it, there’s one key drawback — there’s no profit. The year ended 30 April saw just £1.1m in revenue, with an EBITDA loss of £5.2m.

But there was cash and equivalents of £8m on the balance sheet at the time. After the end of the period, the company raised £4.2m gross from a fundraising. And it received a £1.25m grant from the UK government’s DRIVE35 programme, which funds R&D in vehicle electrification.

This all suggests there’s enough liquidity for a while yet. But analysts still forecast losses for at least the next two years. And they see the cash pile dwindling to around £1m by 2027.

It seems likely that Ilika could need more funding before the profit taps open. And that could well lead to dilution for investors who take the plunge today.

The dilemma

This is the same dilemma that’s faced countless investors in potential high-tech growth stocks while they’re still in the ‘jam tomorrow’ phase. And for me, it usually means I steer clear and don’t consider buying until I see first profit.

But in this case, based on Stereax batteries hopefully generating sales in the near term, I’m actually pondering a small investment. I think penny share growth investors should consider it too.

The post This penny share has soared 85% in 2025. Is it the start of something big? appeared first on The Motley Fool UK.

Right now, with artificial intelligence (AI) spreading into sectors as varied as aerospace, defence, telecommunications and healthcare, there’s a whole tier of specialist firms fuelling the revolution from behind the scenes.

The headlines might be dominated by multi-billion-dollar tech giants, but they can’t do it all. AI’s success often hinges on the niche players making the hardware, components and energy solutions that keep the whole system running. 

Two small-cap UK growth stocks in particular have caught my attention for their potential to ride the AI wave.

Filtronic

Filtronic‘s (LSE: FTC) in the business of high-performance radio frequency (RF) technology. Essentially, it could give AI systems in aerospace and defence their ‘eyes and ears’. Its products provide the precision, bandwidth and fidelity that AI needs to process real-time data and make split-second decisions — which is why demand’s been accelerating.

Over the past year, its market value has more than doubled to roughly £295m, while the share price has soared by around 116%. Revenues have climbed to £56.3m, representing a 121% increase on the previous year, and earnings have surged more than threefold.

Filtronic’s order book has been bolstered by a £3m contract with the European Space Agency in 2023 and, more recently, a record-breaking $32.5m order from SpaceX in June 2025.

With a price-to-earnings (P/E) ratio sitting at 23.8 and very low debt relative to equity, the balance sheet looks solid. 

But it’s not without risk. Competition from US heavyweights like Skyworks Solutions, Qorvo and Teledyne ETM is intense. And with so much of its income tied to large individual contracts, any failure to renew could put a dent in profits.

Ilika

Ilika‘s (LSE: IKA) taking a different route into the AI ecosystem. It develops solid-state batteries that can support both tiny embedded AI devices and large-scale AI infrastructure. These batteries offer high energy density, faster charging, and better safety than traditional lithium-ion cells — qualities that make them ideal for applications where reliability and compactness are crucial.

Although Ilika remains loss-making, with a recent annual shortfall of £5.9m, sales momentum’s impressive, with revenues growing by 265% year on year. The firm’s market capitalisation now stands at just under £70m, with shares trading around 39p. Earnings have slipped by about 16%, but the company holds just £470k in debt against £17.2m of equity, leaving it in a relatively strong financial position for a micro-cap.

That said, with practically no cash flow, it still depends heavily on investor confidence to fund research and expansion. Any slip-up in earnings could send the stock spiralling.

The risk/reward game

Small-cap shares always carry elevated risks, but they’re also where some of the most rewarding returns can be found. For investors seeking early exposure to AI-related growth stocks, Filtronic and Ilika offer two very different but equally intriguing opportunities to consider.

As always, due diligence is essential, but both companies show how the AI boom isn’t just about the glittering names — it’s also about the innovative specialists working quietly in the shadows.

The post 2 up-and-coming UK growth stocks that could benefit from the AI boom appeared first on The Motley Fool UK.

The firm was founded in 2004 as the brainchild of the School of Chemistry at Southampton University. It develops solid state batteries for a variety of industries, from electric vehicles to healthcare.

Lithium-ion batteries have attracted significant attention in recent years, but Ilika’s rival technology could potentially offer solutions to many of their problems. I think this penny stock might make a nice addition to my portfolio. Here’s why.

Battery pioneer

Solid state battery technology isn’t new, but widespread application has proved challenging. Ilika’s trying to address this through its choice of materials and manufacturing process.

Technological advancements have allowed the company to lower production costs. In addition, its batteries can be charged more times and withstand higher temperatures than previous solid state designs.

Solid state batteries have potential advantages over liquid lithium-ion batteries. Taking electric vehicles as an example, according to Ilika, its batteries offer “a higher cell to pack ratio, lighter vehicles, higher energy and power density, extended range and fast charging“.

That all sounds promising, but the company isn’t profitable yet. Ilika’s EBITDA loss widened to £4.1m in H1 2023 from £2.7m in H1 2022. There’s still a long way to go before the firm becomes a fully-fledged commercial success.

Hero products

Ilika has two major product lines. The first is its Stereax miniature battery range. They’re particularly useful for medical devices, minimally invasive implants, and industrial applications.

Promisingly, the company recently signed a 10-year agreement with US-based medical device provider Cirtec Medical focussing on technology transfers and the supply of Stereax products.

Demonstrating the partnership’s potential, the Ilika share price surged 10% on the news and it’s climbed 82% in 2023 so far. However, the stock’s still down 83% from its 2021 peak. Potential investors should note the volatility risk they would be taking on if they bought shares.

The second product line is the company’s large-format Goliath batteries. Designed for electric vehicles, Ilika’s focused on enhancing their capabilities in enabling longer ranges for transportation and easy recyclability.

But, they aren’t cheap. Accordingly, the firm aims to target the luxury automotive sector where cost sensitivity is less of a concern and manufacturers might be prepared to pay a premium for the batteries’ unique qualities. Time will tell how successful this strategy is.

Challenges

Although there’s a compelling case to be made for Ilika’s differentiated technologies, the business is still largely unproven. It only generated £200k in revenue during H1 2023, which suggests the technology still needs to mature before the company can reap the potential rewards.

Additionally, the cash balance slumped to £18.6m from £27.7m in H1 2022. Funding could potentially become an issue if Ilika fails to demonstrate a clear route to commercialisation.

Why I’d buy this stock

This penny stock is a speculative investment proposition, but there’s considerable potential in the company’s technology.

I wouldn’t want to invest too much as the risk/reward profile is high, but if I had spare cash, I’d be happy to allocate some to Ilika shares.

The post One soaring penny stock I’d buy today under 45p appeared first on The Motley Fool UK.

What is behind this leap – and could now be the time for me to add the firm to my portfolio?

Strong momentum

The company has announced various pieces of good news this month, which have helped boost its share price.

These include a broadened relationship with medical device maker Cirtec and grant funding for a collaborative project focussed on battery needs within the automotive industry. The firm also released its interim results, which showed a modest increase in revenue but a widened loss. The results mentioned that Ilika has received initial orders from 18 customers for its Stereax line of batteries.

Is the share price a bargain?

I think the reason the share price has soared is that things seem to be going right for Ilika. The Cirtec deal could open up sizeable future revenue streams.

The battery commercialisation programme is picking up steam, with the Stereax commercial launch expected next quarter. Ilika has long had promising technology. If it can successfully bring that to market with a profitable business model, I think the firm’s current £90m market capitalisation is a potential bargain.

Ongoing challenges

But while promising developments on the path to commercialisation help explain the recent surging Ilika share price, I see sizeable ongoing risks.

Turnover grew in the first half but remained tiny – and consisted only of money from grants, not sales revenues. That highlights the urgent need for commercialisation, in my view.

Cash burn and liquidity

The loss of £4.1m in the first half was sizeable. The company’s cash balance of £18.6m gives it enough liquidity for now, but scaling up manufacturing and sales efforts can be costly. I see a risk that the company will need to boost liquidity in future and dilute shareholders.

The slate of initial orders is a promising indicator of the commercial potential for Ilika’s offer. On top of that, I think the upcoming research on how solid state batteries might be used for the car industry could bolster Ilika’s credibility and help the firm develop its technology for commercial applications.

My move

So, am I buying? No – not yet. Ilika has been making promising moves towards scaling up manufacturing and selling its products. But there is still a long way to go. It is not yet clear what the commercial model will be. We do not know how financially attractive, or otherwise, Ilika’s economics will end up being.

Ilika might end up selling a lot of batteries at an attractive profit margin, while reaping in royalty streams from partners too. If that happens, today’s share price could be a bargain.

But it may struggle to sell enough batteries at an attractive enough price to cover its costs, let alone make money. The company has been losing millions of pounds annually for years already.

I am therefore waiting for more evidence of profitability before I consider adding Ilika to my portfolio.

The post The Ilika share price has doubled this month! Time to buy? appeared first on The Motley Fool UK.

It recovered slightly in early trading on Friday morning, as I write, but is still 78% lower than it was a year ago. What is behind this drop – and what should I do about it?

Lower revenue forecasts

The Ilika trading statement contained bad news. Ramping up commercial production of its flagship Stereax product line is now expected to take longer than planned. Accordingly, revenue in 2024 and 2025 will be “materially lower” than previously forecast.

That is troubling news. Cutting revenue forecasts this far ahead suggests the ultimate timescale for Stereax commercialisation could be far longer than previously thought. As Ilika continues to burn cash, that increases the risk that liquidity shrinks and the company will try to boost funds by diluting shareholders.

Mounting losses

The business also said it expects revenue for the first half of its financial year to come in at the same level as last year: £0.2m.

But while revenues are flat, losses are growing. The loss before interest, tax, depreciation and amortisation is expected to come in at £4.5 million for the first half and the same again in the second half.

That full-year total of £9m is above last year’s £6.4m which, in turn, was a big jump from the £2.3m seen in 2021. As Ilika ramps up Stereax manufacturing capacity and further develops its Goliath range of large format solid-state batteries, losses are growing.

There is a lot of work still be done on both programmes to reach full-scale commercial production. So I see a risk of even higher losses in coming years. The firm expects to end this year with cash and cash equivalents of around £14m.

Some good news

Ilika did not only share bad news however. The energy density of the prototype Goliath cells have improved by around 80% since the start of the financial year. Ilika now expects to reach parity with lithium-ion energy density this year. Although that is behind schedule, I still see it as a positive development. I think it can help boost the commercial proposition of these cells for customers such as electric vehicle manufacturers.

The Ilika share price doesn’t tempt me

I see promise in Ilika’s technology. It is making progress in bringing products to market, even if that is slower than previously hoped.

If things go well, the current share price could turn out to be a bargain. But I am not tempted to add the company to my portfolio. The concern I have is not about potential rewards, but concerns the risks involve. As the latest trading statement shows, Ilika is burning through cash while lowering expectations about commercialisation. That does not match my risk appetite.

The post After the Ilika share price dives to a 12-month low, should I buy? appeared first on The Motley Fool UK.

Wonder metal 

While most commodity prices have taken a hit in 2022, lithium is still trading close to all-time highs of US$70,000/ tonne. And analysts expect lithium prices to rise anywhere between 150% and 250% year over year until 2028. 

To put the current inflation in lithium prices in perspective, let us look at the price action across 2022. In January, lithium cost $10,000 per tonne. Right now, it is trading close to $68,000. This 580% jump in seven months has made it one of the fastest growing commodities in history. 

And with European EV sales at an all-time high, I think this is the perfect time for me to look at lithium shares in the UK.

Two top UK shares I’m watching

To cut out crude oil, the first step is to develop the battery tech to power our machines. And Ilika (LSE:IKA) is a British battery manufacturer with a focus on lithium-based batteries for EVs and medical devices. 

The firm is working on its ‘Goliath’ battery line, which could become a premium option for the automobile belt in Europe. After years of research, Ilika is finally looking to scale up manufacturing efforts to meet this sudden spike in demand. 

The company is already working with the UK Battery Industrialisation Centre (UKBIC) to create a dedicated 100 MWh manufacturing line. Also, Ilika’s tech was recently accepted into the coveted APC programme to help the UK automotive industry reach net-zero emissions.

The next UK share on my list, Rio Tinto (LSE:RIO). The FTSE 100-listed mining giant has actively been securing lithium reserves across the world. These include the Rincon lithium project in Argentina for $825m and the highly promising $2.4bn Jadar lithium project in Serbia. 

The Serbian government recently revoked the license for the Jadar project, citing environmental concerns. This forced Rio Tinto to propose a new plan that promises a 15% reduction in emissions. According to estimates, lithium from Jadar would meet 90% of Europe’s current needs. And Rio’s board is confident that a resolution can be reached.

Concerns and verdict

Despite the estimated demand for batteries, projects like Ilika could meet huge roadblocks. The company is yet to become cash-positive given its high R&D budget. And the journey to being a new product to the market is tough, especially for smaller firms.

Miners like Rio always run the risk of government interventions that could affect operations. Also, with lithium prices skyrocketing, some analysts are wary of the instability. If the demand from China cools down, lithium prices could drop again, effectively ending the surge. 

However, the EV industry looks unstoppable right now. Even Elon Musk has stated that Tesla could enter the lithium mining market to cut costs. And the two UK shares on my watchlist can help address this demand. If the demand for EVs extends into 2022, I would be tempted to make an investment in both to cash in.

The post Lithium prices skyrocket: 2 UK shares I’d buy to capitalise  appeared first on The Motley Fool UK.

Evolving business opportunity

Yet while the share price action has been negative, the noise coming from the battery industry has been increasingly positive.

Consider Ilika as an example. It has leased a factory and installed a clean room for production of its flagship Stereax battery line. The company said in its final results this month that it expects to start shipping Stereax batteries early next year.

In other words, we may only be months away from commercial production of Stereax at scale after years of waiting. The company was touting Stereax by name as far back as 2016 and developing the technology even before that.

Meanwhile, Ilika is also making progress on its Goliath product line. It is in the process of designing the manufacturing process for these batteries. It anticipates the product reaching manufacturing readiness in 2023 and then the company wants to ramp up production to what it calls “mega-factory scale”.

Has anything changed?

On one hand, Ilika looks much the same as it used to. Revenues are small and the business consistently burns through cash.

But it seems finally to be on the cusp of moving up to commercial levels of production. That should be transformative for revenues and could lay the foundation for future profitability.

Meanwhile, solid state batteries are also seeing growing momentum on the demand side. The campaign group Transport & Environment released a report last week on new research that showed solid state batteries can reduce the carbon footprint of an electric vehicle by 24%. That is a large difference and I expect soaring demand for solid state batteries in coming years. Toyota plans to release its own solid state battery in 2025 and rival carmakers are planning vehicles powered by the technology.

Is now the moment to buy battery shares?

The size of the future opportunity for solid state batteries seems to be growing. Large scale commercialisation is also getting closer to reality. What might that mean for solid state battery shares?

For years producers have been in a development phase, with funds needed for research and development. Commercialisation will also bring costs, such as building production facilities and spending on sales efforts. But revenues should start to increase significantly. Hopefully, eventually, profits may follow.

For me, though, it is still not the perfect moment to buy battery shares. There is a lot left to prove about the business model, not least that it will be profitable. That applies to the industry overall and it certainly applies to specific battery companies in my view. Brand new technologies can produce winners, but also a lot of losers.

That is why I usually prefer to wait until a company proves its business model before investing. I think now is an exciting time for solid state battery companies. But I am not yet buying battery shares for my portfolio.

The post Is now — finally — the perfect moment to buy solid state battery shares? appeared first on The Motley Fool UK.

Although the price remains above the £1 level for now, Ilika has been moving closer to penny stock territory. Will it end up becoming a penny share?

Business momentum

At first glance, the share price slide may seem odd when set against the company’s business momentum. Ilika has set up a factory to produce its Stereax line of batteries. It is in the process of making sure the factory works as hoped. It should start commercial sales fairly soon.

On top of that, the company is also making progress with its Goliath line of products. It has continued to improve the design and is now planning how to manufacture the batteries at scale.

However, this progress with research and manufacturing has not yet translated to improved finances. In fact, revenue in the company’s first half fell to just a couple of hundred thousand pounds. But the loss before interest, tax, depreciation and amortisation increased to £2.7m from £1m in the prior year period. For now, Ilika has enough liquidity to tide it over even when making losses. Its last reported cash balance, at the end of October, was £27.7m.

The Ilika share price

Still, that cash balance has come at a cost to shareholders. The company raised around £25m last summer to prop up its finances, partly by diluting existing shareholders. If it keeps making losses, there is a risk it could dilute shareholders again in future.

I think the reason the Ilika share price has been falling is a revaluation of the firm’s prospects. Its technology is promising and progress towards commercial production is a positive step. But it has also meant that investors are no longer thinking of Ilika in purely theoretical terms when it comes to business potential. Instead they are starting to think about how the company can build its sales capability, how much more funding may be needed by the company to fund its growth plans and also whether increasing competition could put profit margins under pressure in future.

So while Ilika continues to have attractive technology and is moving closer to selling its products in large amounts, its financial model remains a matter of concern. The market capitalisation of £185m still looks high to me for a company at its stage of development.

Penny share

Based on that, I would not be surprised if the Ilika share price keeps falling. I could see it fall beneath £1 in the coming year, especially if there is bad news, like an unexpected delay to production or poor sales figures.

If Ilika becomes a penny share, it would simply put the price back where it used to be. Until 2020, it had traded as a penny share for most of the time it had been listed on the stock market. It still would not tempt me in, though. I do like its technology and reckon it has promise. But the company simply does not have the sort of proven business model I feel most comfortable with when buying new shares for my portfolio.

The post Will the Ilika share price crash beneath £1? appeared first on The Motley Fool UK.

One problem, two solutions

Although both are alternative energy companies, they have different technical perspectives. Ilika is focussed on developing solid state battery technology. That can help store energy for users such as electric vehicle drivers. ITM Power is focussed on hydrogen as an energy source. So far its focus is more on industrial than consumer applications, although that could change down the line.

I see a wider variety of possible applications for solid state batteries, whereas hydrogen energy is just one more possible energy source among many. But I think it is too early to say with any confidence whether either of the two approaches is likely to end up with large, enduring market demand.

Valuation collapse

Ilika’s market capitalisation of £120m is less than a tenth that of ITM Power, which commands a valuation of £1.4bn. Ilika is also a much smaller business. In its interim results, it reported revenue of just £0.2m compared to £4.2m at ITM Power. Neither is a big number, especially when one considers the market capitalisations of the two firms. But that is not unusual among early stage companies. Initially, revenue can be low as the technology is perfected and commercialised. But hopefully down the line it ramps up. Both Ilika and ITM Power now have their own commercial scale factories and are working to build growing sales pipelines.

Over the past year, Ilika has seen its share price fall by 50% while ITM Power has dropped even more, tumbling 55%. I think these prices reflect valuation concerns among investors. Both companies have promising technology, but they still have a lot of work to do to scale them commercially. They also need to prove that they have a viable business model. For now, both are loss-making. If the technologies prove attractive, I expect competition to get fiercer. That could be bad for future profit margins at the companies. Losses could continue for years to come.

My move on the Ilika and ITM share prices

The share prices at each of these alternative energy companies has tumbled in the past year. Both have promising technologies that could yet form the basis of substantial businesses. But for now, revenues remain low and there are no profits in sight.

I feel it is too early to say whether either Ilika or ITM will make it into the big time as the alternative energy industry grows. So even after the share price falls, I continue to see both shares as too speculative for my portfolio at the moment. The two companies trade at a huge multiple to sales, let alone earnings. So I do not regard either share as a bargain. I will not be adding them to my portfolio.

The post Is the Ilika or ITM Power share price a bargain? appeared first on The Motley Fool UK.