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3 ASX Penny Stocks With At Least A$100M Market Cap
The Australian market remained flat over the last week but has seen a significant 20% increase over the past year, with earnings forecasted to grow by 12% annually. While penny stocks may seem like an outdated term, they continue to represent intriguing opportunities for growth at lower price points, especially when backed by strong balance sheets and solid fundamentals. This article explores three high-quality penny stocks that stand out as hidden gems in today's market landscape.
Overview: Kingsgate Consolidated Limited is involved in the exploration, development, and mining of gold and silver mineral properties, with a market cap of A$398.23 million.
Operations: The company generates revenue primarily from its Chatree segment, which amounts to A$133.09 million.
Market Cap: A$398.23M
Kingsgate Consolidated has demonstrated significant financial growth, with its revenue surging to A$133.09 million from A$27.34 million in the previous year, and net income reaching A$199.76 million. The company's debt is well-managed, supported by operating cash flow and a satisfactory net debt to equity ratio of 14.8%. Despite a new management team with limited tenure, Kingsgate's return on equity is outstanding at 80.7%, and interest payments are well-covered by EBIT at 28.9 times coverage. However, earnings are expected to decline significantly over the next three years despite recent impressive growth figures exceeding industry averages.
Overview: Qube Holdings Limited, with a market cap of A$6.75 billion, offers logistics solutions for import and export supply chains across Australia, New Zealand, and Southeast Asia through its subsidiaries.
Operations: The company's revenue is primarily generated from its Operating Division, which accounts for A$3.51 billion.
Market Cap: A$6.75B
Qube Holdings has shown robust financial performance with earnings growing by 29.1% over the past year, surpassing its five-year average growth of 7.4%. The company's revenue reached A$3.36 billion, up from A$2.88 billion the previous year, while net income increased to A$221.9 million from A$167.9 million. Qube's debt management is prudent, as evidenced by a satisfactory net debt to equity ratio of 39.7%, and its interest payments are well-covered by EBIT at three times coverage. Recent board changes include the retirement of Deputy Chairman Sam Kaplan, who will continue offering strategic advice post-retirement.
Overview: Silver Mines Limited focuses on acquiring, exploring, and developing silver projects in Australia with a market cap of A$180.96 million.
Operations: The company's revenue segment includes Agricultural Operations, generating A$0.26 million.
Market Cap: A$180.96M
Silver Mines Limited, with a market cap of A$180.96 million, is pre-revenue and reported sales of A$0.26 million for the year ending June 30, 2024. Despite a net loss reduction from A$4.11 million to A$2.22 million, the company remains unprofitable with increased losses over five years at 17.2% annually. The board's average tenure is experienced at 4.9 years; however, shareholders faced dilution with shares outstanding growing by 7.4%. Silver Mines has no debt and sufficient cash runway for over a year but exhibits high volatility compared to most Australian stocks.
This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
Companies discussed in this article include ASX:KCN ASX:QUB and ASX:SVL.
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