There are loads of UK shares buying and selling for pennies proper now. In accordance with my knowledge supplier, there are round 800 shares on the London Inventory Alternate right now buying and selling for lower than £1.

Now, not all of those firms are price investing in, in fact. There are many low-quality companies in that group of shares.

However there are some absolute gems as nicely. Right here’s one which I believe is price contemplating right now.

A 28p progress inventory

hVIVO (LSE: HVO) is a small firm within the Healthcare sector that specialises in providers for scientific trials and lab testing. Headquartered in London, it gives end-to-end early scientific improvement providers to a big, established, and rising repeat consumer base, which incorporates 4 of the highest 10 largest world biopharma firms.

At the moment, shares in hVIVO commerce for simply 28p. At that share price, its market-cap is round £189m.

Spectacular progress

From an funding perspective, hVIVO’s quite a bit going for it, in my opinion.

For starters, it’s rising at a formidable tempo. Over the past three years, revenues have climbed from £20.6m to £56m – progress of 172%. This 12 months and subsequent, analysts count on income of £61.9m and £67.7m.

It’s price noting right here that the corporate’s concentrating on income of £100m by 2028. So it clearly expects the expansion to proceed within the years forward.

One factor that ought to assist to drive progress is its new state-of-the-art facility in Canary Wharf. This could allow the corporate to scale up quickly.

Producing earnings

Secondly, the corporate’s now worthwhile. This 12 months, analysts count on hVIVO to generate a web revenue of £9.1m and earnings per share of 1.41p. Income are essential as a result of they cut back threat for traders. Additionally they make firms a lot simpler to worth.

Good valuation

When it comes to the valuation right here, it appears to be like engaging to me. At the moment, the forward-looking price-to-earnings (P/E) ratio is nineteen.7, falling to 16.4 utilizing the consensus earnings forecast for 2025.

Given the expansion the corporate’s producing, we seem to have a traditional ‘growth-at-a-reasonable-price’ (GARP) inventory. Through the years, I’ve discovered that GARP shares typically outperform the market over time.

Rising dividends

Lastly, there are dividends on provide too. The yield right here isn’t large (0.8%) as the corporate solely began paying dividends final 12 months.

However the payout’s rising and I see scope for substantial will increase within the years forward. That’s as a result of the dividend protection ratio (the ratio of earnings to dividends) could be very excessive at over six.

Loads of potential

Now in fact, there are just a few dangers to contemplate right here. One is volatility in earnings, which is sort of frequent amongst small progress firms within the strategy of increasing. This might result in future share price volatility.

One other is issues from scientific trials. This situation may additionally result in share price weak spot.

General although, I consider this inventory has loads of potential. Of the six brokers masking it, three fee it as a Purchase and three have it as a Robust Purchase.