Over the last 7 days, the Australian market has risen 1.5%, contributing to a 17% increase over the past year, with earnings forecasted to grow by 12% annually. For investors interested in smaller or newer companies, penny stocks—despite their somewhat outdated name—can still present intriguing opportunities when backed by strong financials. This article explores several penny stocks that stand out for their financial strength and potential for long-term growth.

Top 10 Penny Stocks In Australia

Name	Share Price	Market Cap	Financial Health Rating
LaserBond (ASX:LBL)	A$0.59	A$68.57M	★★★★★★
Embark Early Education (ASX:EVO)	A$0.81	A$146.79M	★★★★☆☆
Helloworld Travel (ASX:HLO)	A$2.00	A$318.31M	★★★★★★
Austin Engineering (ASX:ANG)	A$0.54	A$310.07M	★★★★★☆
MaxiPARTS (ASX:MXI)	A$1.89	A$103.44M	★★★★★★
SHAPE Australia (ASX:SHA)	A$2.88	A$239.61M	★★★★★★
Navigator Global Investments (ASX:NGI)	A$1.65	A$825.78M	★★★★★☆
West African Resources (ASX:WAF)	A$1.48	A$1.7B	★★★★★★
Atlas Pearls (ASX:ATP)	A$0.15	A$69.71M	★★★★★★
Servcorp (ASX:SRV)	A$4.80	A$483.46M	★★★★☆☆

Click here to see the full list of 1,044 stocks from our ASX Penny Stocks screener.

Here’s a peek at a few of the choices from the screener.

Aurelia Metals

Simply Wall St Financial Health Rating: ★★★★★☆

Overview: Aurelia Metals Limited is an Australian company involved in the exploration and production of mineral properties, with a market capitalization of A$287.57 million.

Operations: The company’s revenue segments comprise the Hera Mine generating A$0.20 million, the Peak Mine contributing A$207.34 million, and the Dargues Mine adding A$102.36 million.

Market Cap: A$287.57M

Aurelia Metals Limited, with a market cap of A$287.57 million, remains unprofitable despite generating A$309.89 million in sales for the year ending June 2024. The company has seen its debt to equity ratio rise over five years but maintains more cash than total debt and sufficient short-term assets to cover liabilities. While earnings are forecasted to grow annually by 30.18%, challenges persist due to negative return on equity and increasing losses over the past five years at a significant rate. Management and board experience is limited, potentially impacting strategic direction amidst stable weekly volatility in stock performance.

• Click to explore a detailed breakdown of our findings in Aurelia Metals’ financial health report.

• Review our growth performance report to gain insights into Aurelia Metals’ future.

ASX:AMI Financial Position Analysis as at Nov 2024Djerriwarrh Investments

Simply Wall St Financial Health Rating: ★★★★★★

Overview: Djerriwarrh Investments Limited is a publicly owned investment manager with a market cap of A$833.34 million.

Operations: The company generates revenue primarily from its portfolio of investments, amounting to A$53.38 million.

Market Cap: A$833.34M

Djerriwarrh Investments Limited, with a market cap of A$833.34 million, has shown stable financial health despite some challenges. The company’s earnings have grown modestly by 5.3% annually over five years, although recent negative growth (-0.3%) contrasts with industry averages. Its dividend yield of 4.83% is not well covered by earnings or cash flows, raising sustainability concerns. However, Djerriwarrh’s debt management is strong; it holds more cash than total debt and maintains high interest coverage (11.7x). Recent board changes include Catherine Brenner’s appointment as Non-Executive Director following Alice Williams’ retirement announcement at the AGM in October 2024.

• Take a closer look at Djerriwarrh Investments’ potential here in our financial health report.

• Examine Djerriwarrh Investments’ past performance report to understand how it has performed in prior years.

ASX:DJW Debt to Equity History and Analysis as at Nov 2024Michael Hill International

Simply Wall St Financial Health Rating: ★★★★☆☆

Overview: Michael Hill International Limited operates jewelry stores and offers related services across Australia, New Zealand, and Canada with a market cap of A$227 million.

Operations: The company generated revenue of A$646.60 million from its operations in Australia, New Zealand, and Canada.

Market Cap: A$227M

Michael Hill International, with a market cap of A$227 million, is currently unprofitable but shows potential for earnings growth at 37.42% per year. Despite a negative return on equity, the company maintains a satisfactory net debt to equity ratio of 23.2%, and its operating cash flow covers debt well (64.1%). Recent sales announcements indicate an upward trend with group sales up 4.3% in early fiscal 2025, driven by strong performance in Australia and Canada. However, challenges remain as interest payments are not well covered by EBIT, and no final dividend was declared for the past fiscal year.

• Unlock comprehensive insights into our analysis of Michael Hill International stock in this financial health report.

• Assess Michael Hill International’s future earnings estimates with our detailed growth reports.

ASX:MHJ Financial Position Analysis as at Nov 2024Turning Ideas Into Actions

• Explore the 1,044 names from our ASX Penny Stocks screener here.

• Got skin in the game with these stocks? Elevate how you manage them by using Simply Wall St’s portfolio, where intuitive tools await to help optimize your investment outcomes.

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Contemplating Other Strategies?

• Explore high-performing small cap companies that haven’t yet garnered significant analyst attention.

• Jump on the AI train with fast growing tech companies forging a new era of innovation.

• Find companies with promising cash flow potential yet trading below their fair value.

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:AMI ASX:DJW and ASX:MHJ.

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