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Two penny shares I plan to purchase after I subsequent have some spare money are DP Poland (LSE: DPP) and Revolution Magnificence Group (LSE: REVB).
Right here’s why!
DP Poland
The enterprise franchises the well-known Domino’s Pizza model in rising markets Poland and Croatia.
DP Poland shares are up 50% over a 12-month interval from 8p presently final 12 months, to present ranges of 12p.
From a bullish view, demand for quick meals in Poland and Croatia is hovering. Rising markets current a chance for the agency to capitalise on rising private revenue ranges, in addition to present low market penetration.
The enterprise has recorded wonderful efficiency in current occasions. In truth, it recorded its finest ever quarter, the ultimate quarter for 2023. Like-for-like gross sales on this interval elevated a whopping 27.5%.
For the 12 months as a complete, the enterprise posted an replace in January. Like-for-like gross sales in Poland and Croatia rose by a formidable 19.4% and 16.4%.
From a bearish view, the quick meals business is very aggressive. I’m positive others can be trying to capitalise on this probably profitable rising territory. Plus, present inflationary pressures are an ongoing danger as they may take a chunk out of revenue margins.
Total, the DP Poland continues to open new areas. Moreover, it’s investing closely in advertising and marketing and know-how to zero in on a dominant market place. A wholesome wanting steadiness sheet ought to stand it in good stead. One in all my greatest worries with small cap shares is an absence of money, which may usually result in bother.
Revolution Magnificence Group
Private care and sweetness enterprise Revolution Magnificence Group has been on an incredible progress journey, and went public again in 2021. The enterprise sells a lot of manufacturers direct to shoppers by way of e-commerce, in addition to in retail shops.
The shares are up simply over 12% throughout a 12-month interval from 24p presently final 12 months, to present ranges of 27p.
In line with information revealed by Statista, the wonder and private care market is just set to proceed to develop at a fast fee. This could possibly be excellent news for the enterprise.
Revolution has a lofty intention of hitting £1bn price of gross sales by 2030. A brand new administration workforce, introduced in attributable to an accounting and reporting scandal, wish to ship contemporary impetus to the enterprise to hit this goal.
Final month’s buying and selling replace shed additional gentle on current buying and selling, and full-year expectations. The enterprise stated EBITDA progress ought to are available at low double-digit figures, which is an improve on the earlier forecast. It seems just like the agency’s strategic evaluate to drive efficiencies, margins, and profitability is already working.
From a bearish view, I’m going to keep watch over beleaguered quick style agency boohoo‘s rising affect on the enterprise. It at the moment holds near 30% price of shares within the enterprise. boohoo’s nicely documented struggles are one thing I’m hoping that Revolution can keep away from sooner or later.
Total, a optimistic journey up to now, contemporary impetus, and strategic evaluate wanting prefer it’s bearing fruit. These, together with a burgeoning market place assist construct my funding case.
