February 2025 ASX Penny Stocks To Watch

The Australian market has recently experienced a downturn, with the ASX200 down 1.66% amid concerns over potential global trade tensions and broad sector declines led by Materials, Discretionary, and Health Care. Despite these challenges, penny stocks continue to capture investor interest as they offer unique opportunities for growth at lower price points. While the term "penny stocks" might seem outdated, these smaller or newer companies can still present compelling investment prospects when backed by strong fundamentals and financial health.

Top 10 Penny Stocks In Australia

Name	Share Price	Market Cap	Financial Health Rating
Embark Early Education (ASX:EVO)	A$0.78	A$143.12M	★★★★☆☆
LaserBond (ASX:LBL)	A$0.57	A$66.82M	★★★★★★
SHAPE Australia (ASX:SHA)	A$2.96	A$245.42M	★★★★★★
Austin Engineering (ASX:ANG)	A$0.50	A$310.07M	★★★★★☆
Helloworld Travel (ASX:HLO)	A$2.01	A$327.26M	★★★★★★
MaxiPARTS (ASX:MXI)	A$1.92	A$106.21M	★★★★★★
GTN (ASX:GTN)	A$0.55	A$108.01M	★★★★★★
IVE Group (ASX:IGL)	A$2.23	A$345.4M	★★★★☆☆
SKS Technologies Group (ASX:SKS)	A$1.59	A$247.67M	★★★★★★
Nickel Industries (ASX:NIC)	A$0.765	A$3.28B	★★★★★☆

Click here to see the full list of 1,030 stocks from our ASX Penny Stocks screener.

Let's uncover some gems from our specialized screener.

Duratec (ASX:DUR)

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

Overview: Duratec Limited, along with its subsidiaries, provides assessment, protection, remediation, and refurbishment services for steel and concrete infrastructure assets in Australia, with a market cap of A$385.62 million.

Operations: The company's revenue is primarily derived from its Defence segment at A$220.16 million, followed by Mining & Industrial at A$155.64 million, Buildings & Facades at A$111.33 million, and Energy at A$46.64 million.

Market Cap: A$385.62M

Duratec Limited, with a market cap of A$385.62 million, has shown significant earnings growth of 24.8% annually over the past five years, although recent growth slowed to 11.6%. The company is debt-free and its short-term assets exceed both short-term and long-term liabilities, indicating strong financial stability. Despite high-quality earnings and a robust return on equity at 36.2%, its dividend yield of 2.61% isn't well-covered by free cash flow. Duratec's revenue forecast for the year ending June 2025 is between A$600 million to A$640 million, reflecting continued business expansion across its key segments like Defence and Mining & Industrial.

• Click to explore a detailed breakdown of our findings in Duratec's financial health report.
• Examine Duratec's earnings growth report to understand how analysts expect it to perform.

Magnetic Resources (ASX:MAU)

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

Overview: Magnetic Resources NL is involved in the exploration of mineral tenements in Western Australia and has a market cap of A$337.45 million.

Operations: The company generates revenue from its mineral exploration activities, amounting to A$0.50 million.

Market Cap: A$337.45M

Magnetic Resources NL, with a market cap of A$337.45 million, remains pre-revenue and is currently unprofitable. The company has no debt and its short-term assets significantly exceed liabilities, offering some financial stability. Recent developments at the Lady Julie Gold Project have increased resource confidence and mineralisation continuity, with 75% of resources now in the Indicated category. The project explores potential for concurrent underground operations to enhance value further. Despite having a sufficient cash runway for five months based on free cash flow estimates, Magnetic Resources has raised additional capital to support ongoing exploration activities.

• Dive into the specifics of Magnetic Resources here with our thorough balance sheet health report.
• Gain insights into Magnetic Resources' historical outcomes by reviewing our past performance report.

NRW Holdings (ASX:NWH)

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

Overview: NRW Holdings Limited offers diversified contract services to the resources and infrastructure sectors in Australia, with a market cap of A$1.57 billion.

Operations: The company generates revenue from three main segments: Mining (A$1.52 billion), MET (A$791.81 million), and Civil (A$655.46 million).

Market Cap: A$1.57B

NRW Holdings, with a market cap of A$1.57 billion, demonstrates financial stability and growth potential in the resources and infrastructure sectors. The company's revenue streams from Mining, MET, and Civil segments contribute to its robust financial position. Notably, NRW's debt is well-managed with more cash than total debt and strong coverage by operating cash flow. Although the dividend is not fully covered by free cash flows, earnings have shown consistent growth over five years at 16.4% annually, with an acceleration to 22.7% recently. Despite recent executive changes in the CFO position, NRW maintains experienced leadership across its board and management team.

• Get an in-depth perspective on NRW Holdings' performance by reading our balance sheet health report here.
• Learn about NRW Holdings' future growth trajectory here.

Taking Advantage

• Jump into our full catalog of 1,030 ASX Penny Stocks here.
• Are these companies part of your investment strategy? Use Simply Wall St to consolidate your holdings into a portfolio and gain insights with our comprehensive analysis tools.
• Invest smarter with the free Simply Wall St app providing detailed insights into every stock market around the globe.

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.

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