I think these top-quality penny stocks could help me make a huge amount of cash. Here’s why I think they are dynamite buys right now.
Topps Tiles (trades at 66p)
A strong home improvement market means I’m tempted to splash out on Topps Tiles today. The vast amounts of savings Britons accrued during Covid-19 lockdowns is supercharging the DIY market. So is a rock-solid housing market. As a consequence, Topps Tiles delivered record annual revenues of £227.5m during the 12 months to September.
OK, demand for the company’s tiles could slump if economic conditions worsen and business and consumer confidence dive. But I’m confident Topps Tiles will thrive as it takes steps to build market share (it’s aiming for a 20% by the middle of the decade).
DP Poland (trades at 6.3p)
The booming online food delivery sector offers plenty of opportunity for me to also make some cash. According to Statista analysts, the global market will be worth $154.3bn by 2023. That’s up considerably from the $111.3bn it was valued at in 2020 when Covid-19 lockdowns supercharged takeaway demand.
I’m tempted to invest in DP Poland to capitalise on this theme. As the sole franchisee of the Domino’s brand in Poland, it benefits significantly from the chain’s immense brand power. It is also well-placed to exploit soaring personal wealth levels in the Eastern European nation. I’d buy it even though competition in the food delivery market is intense and a threat to future profits.
Steppe Cement (trades at 43p)
This penny stock (as the name suggests) manufactures cement in and around the Eurasian Steppe in Kazakhstan. I think Steppe Cement could be a great buy for my portfolio as construction activity in the emerging market is ballooning.
Investment in housing is particularly strong as urbanisation takes hold. Between January and November some 13.4m square metres of housing was commissioned, up 10.6% year-on-year.
Revenues at Steppe Cement rose 4% in the first nine months of 2021 amid the construction boom. However, I will be keeping an eye on rising civil unrest in cities across Kazakhstan. This could have significant economic consequences if it escalates further.
Inland Homes (trades at 55p)
Homes are in short supply in the UK and this is playing into the hands of housebuilders like Inland Homes. But this particular penny stock is about more than just putting up new residential properties. It buys up brownfield land and secures planning permissions to either then sell onto other developers, or to build on itself or with the help of industry partners.
Inland Homes’ strategy is highly successful and in the 12 months to September it enjoyed record high turnover of £195m. I am concerned about the high levels of debt the business has accrued to build its land bank. Though the rate at which net debt is falling (down 20% year-on-year in the last financial year) is encouraging.
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Royston Wild has no position in any of the shares mentioned. The Motley Fool UK has recommended Inland Homes. 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.