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Penny stocks are typically high-risk investments. It can be worth considering a small allocation to these stocks however, as they can occasionally deliver enormous returns.
Here, I’m going to highlight a penny stock that City analysts are very bullish on right now. It currently trades for just 13.8p, meaning that £1,000 buys around 7,200 shares.
A healthcare game-changer
The stock in focus today is Creo Medical (LSE: CREO). It’s an innovative medical device company that specialises in instruments for endoscopic (minimally invasive) surgery.
Its products include Speedboat Inject, a multimodal endoscopic instrument that can be used by surgeons to dissect, cut out, inject, seal and more when operating on pre-cancer and cancer patients, and Speedboat Ultraslim, a slimmer version designed to reach deep/tight spots in the digestive tract. With these products, surgeons can perform complex procedures entirely through an endoscope and patients can potentially avoid major surgery.
Expect a wild ride
Now, this is a very small company. Currently, its market-cap is only £59m. Companies of this size tend to be risky investments because their share prices tend to swing wildly due to a lack of trading liquidity.
They often also have new technologies that are unproven at scale, and lack profitability. And that’s the case here – this is relatively new technology and the company isn’t making a profit.
Analysts are very bullish on Creo Medical however. Currently, the average price target is 40p – about 190% above the current share price.
A strong performance in 2025
While analysts’ share price targets need to be taken with a grain of salt, I can see why they’re bullish here. At present, Creo has momentum.
For 2025:
- Revenue was up 50% year on year to £6m (with second half revenue up 58%) thanks to continued clinical adoption of its products.
- Underlying operating costs were down 20% to £18.4m thanks to cost control.
- The cash balance at the end of the year was £12.4m versus £8.7m a year earlier.
Huge growth expected in 2026
Looking ahead, the company said that the outlook for FY2026 and beyond is positive. This year, it expects continued sequential growth period-on-period along with improved operational efficiency.
“Strategically, our products are well positioned in growing attractive markets creating significant potential for shareholder returns.”
Creo Medical chair Kevin Crofton
It’s worth noting that at present, analysts expect Creo to generate revenue of £10.2m this year. There’s no guarantee the company will be able to deliver on this figure, but if it did, it would represent top-line growth of a whopping 70%.
Is there an investment opportunity here?
So is this penny stock worth a closer look? I think so. It’s not a stock I’d go ‘all in’ on. There are plenty of risks and it could end up tanking. I see a lot of potential at the current share price though. In my view, it’s worthy of further research.
