In my search for new penny stocks, I came across a construction company focused on sustainability that caught my attention. Alumasc (LSE:ALU) is a UK-based supplier of sustainable building solutions, with a valuation of £66m. It has been recognized with the London Stock Exchange’s Green Economy Mark for its efforts in reducing waste and improving the environment.
Renewables are gaining momentum, with federal investments in clean energy at an all-time high. Alumasc stands to benefit from the growing demand for sustainable solutions. However, the costs of renewable energy still pose challenges, and the company’s success is tied to the overall credibility of the industry.
Despite facing losses in 2022 due to inflation, Alumasc’s share price has seen a 94% increase in the past five years. It is currently undervalued by 34% and offers a 5.6% dividend yield. With strong earnings and a low P/E ratio, there is potential for further growth.
Investing in penny stocks like Alumasc comes with risks, including the cyclical nature of the construction industry and competition. However, if the company can overcome these challenges, it has the potential to become a major player in sustainable solutions. Overall, Alumasc presents an attractive opportunity for investors looking to add a penny stock to their portfolio.