The UK market has faced challenges recently, with the FTSE 100 index closing lower due to weak trade data from China, highlighting concerns about global economic recovery. In such a climate, identifying stocks that combine financial strength with growth potential is crucial for investors. Penny stocks, while an older term, still represent smaller or emerging companies that can offer unique opportunities when backed by solid fundamentals.

Click here to see the full list of 475 stocks from our UK Penny Stocks screener.

We'll examine a selection from our screener results.

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

Overview: hVIVO plc is a pharmaceutical service and contract research company based in the United Kingdom, with a market cap of £192.55 million.

Operations: The company generates its revenue from medical and scientific research services, amounting to £67.21 million.

Market Cap: £192.55M

hVIVO plc has demonstrated robust financial growth, with earnings increasing significantly over the past year and a solid net profit margin improvement. The company is debt-free, enhancing its financial stability, and trades at a substantial discount to estimated fair value. Recent revenue figures show an increase to £35.64 million for H1 2024, reflecting strong operational performance. hVIVO's decision to consolidate its stock listing on AIM aims to streamline operations and reduce costs without affecting share trading. Despite forecasts of declining earnings in the coming years, hVIVO maintains high-quality earnings and experienced management.

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

Overview: Mercia Asset Management PLC is a private equity and venture capital firm focused on a wide range of investment stages, including incubation and growth capital, with a market cap of £131.55 million.

Operations: The company generates revenue of £30.43 million from its Proactive Specialist Asset Management segment.