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2 top penny stocks to buy for 2022!

British Pennies on a Pound Note

I think UK share investors need to be careful buying penny stocks for 2022. The worsening Covid-19 crisis casts a shadow over the global economy for next year.

But there’s other issues that could derail corporate profits like China’s economic cooling and soaring inflation. News that US inflation hit 40-year highs last month certainly caught my attention.

Personally, I don’t plan to stop looking for penny stocks to buy. A company’s low share price doesn’t mean it’s in danger of significant profits trouble in 2022. Nor does it mean that it doesn’t have the financial strength to survive further economic volatility.

With this in mind, here are two top penny stocks I’m considering buying for 2022. I think they could help me make terrific returns beyond the next 12 months too.

A penny stock for the eco revolution

The growing importance of greener energy and waste reduction means Powerhouse Energy Group (LSE: PHE) could have a very bright future. It is a specialist in the field of creating synthetic gas from waste products like plastics. Gas which is then used to make hydrogen.

The waste-to-energy market is tipped for huge growth as concerns over the environmental impact of landfill sites increase. Analysts at Grand View Research think it’ll be worth $54.8bn by 2027, up from $33bn today.

Powerhouse is hoping its under-construction Protos project in Cheshire — which it expects will power up to a quarter of a million homes when it starts up in 2024 — will allow it to exploit this fast-growing market.

Powerhouse Energy’s share price could suffer significant weakness if delays in getting Protos up-and-running develop. This would be particularly problematic if costs spiral as a result. Still, as things stand today, I think there’s a lot to get excited about with this cheap UK share. Today, the company trades at 4p per share.

Turkish delight

I’m also considering buying DP Eurasia (LSE: DPEU) for my shares portfolio in 2022. This penny stock (which trades at 88p per share) looks particularly delicious in terms of value today. City analysts think earnings at the pizza seller will rocket 320%-plus next year. This leaves it trading on a forward price-to-earnings growth (PEG) ratio of just 0.1.

DP Eurasia is the master franchisee of the Domino’s Pizza brand in Turkey, Azerbaijan, Georgia and Russia. It thus has considerable brand power in an industry tipped for explosive growth in the years ahead. Latest financials showed system sales leapt almost 52% year-on-year during the 10 months to October.

My main concern for DP Eurasia is the growing economic instability in its key market of Turkey. Last week, ratings agency S&P slashed its outlook on the economy there due to soaring inflation. Still, I’m encouraged by the penny stocks impressive recent momentum, in spite of worsening conditions in its Turkish market.

The post 2 top penny stocks to buy for 2022! appeared first on The Motley Fool UK.

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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.