I don’t have unlimited reserves of cash that I can use to buy UK shares. But here’s a collection of top penny stocks I’d like to invest in in 2023. I believe they could provide market-beating returns for the next couple of decades.
Totally
Changes to NHS policy could disrupt profits growth at many UK healthcare shares. But Totally looks in great shape as the government tries to slash emergency visits to hospitals.
The business operates the NHS’s 111 emergency helpline. It also runs urgent care centres and out-of-office doctor surgeries. Demand for such services is soaring as waiting times at Accident and Emergency units goes through the roof.
Totally could be a great pick for a challenging 2023 too. Its essential operations mean that profits should remain stable whatever happens to the British economy.
And profits could rise strongly over the long term as well. Britain’s elderly population is ballooning and, as a consequence, so is demand for healthcare services.
Steppe Cement
Kazakhstan has made greater urbanisation one of its priorities for the 21st century. This bodes well for domestic construction material supplier Steppe Cement.
Analysts at the UN think almost 70% of the country’s population will be living in towns and cities by 2050. That compares with less than 59% last year. Based on these projections, the amount of cement Kazakh builders need will leap over the coming decades.
Revenues at Steppe Cement rose 68% during the five years to 2021 at local currencies. I believe they should keep growing strongly too, although unfavourable foreign exchange movements are a constant threat to profits growth.
Gaming Realms
Changes within the highly regulated gambling industry can significantly dent company profits. Game software developer Gaming Realms is one such firm at the mercy of lawmakers.
But the earnings outlook has improved significantly, thanks to recent regulatory loosening in the US. Gaming Realms — whose most successful product is the Slingo line of games — launched its services in Pennsylvania and Michigan last year. And it made its first steps into Connecticut in October.
The US is a colossal growth market for gambling operators. And Gambling Realms is making progress on a number of fresh operator launches to maximise this opportunity.
Surface Transforms
The global sports car market is tipped to expand rapidly. This will be driven by a growing class of millionaires and billionaires, analysts say.
This is good news for Surface Transforms, a penny stock that manufactures ceramic brakes for high-performance vehicles. The market for these lightweight discs is growing strongly too as automakers ditch traditional technologies like iron brake discs.
Surface Transforms plans to supercharge production capacity to meet booming customer demand as well. It’s expanding its current factory in Liverpool and is making progress on opening another manufacturing site.
Supply chain problems remain a danger to profits in 2023. But a bright long-term outlook still makes the brakebuilder an attractive small-cap to buy, in my opinion.
