Looking for big returns without spending big? Penny stocks on the ASX might be your answer. These low-priced shares, also known as penny shares, are often overlooked but can be some of the most exciting plays for retail investors chasing high upside. While these high risk stocks come with volatility, the right picks can deliver outsized returns if the underlying companies execute on their potential.

In this blog, we’ll highlight some of the best penny stocks ASX investors should watch closely — names with strong business models, growing revenues, and industry tailwinds that could ignite explosive growth in the months ahead. These are not just cheap ASX stocks, they’re small cap stocks with big ambitions.

Change Financial (ASX: CCA)
Riding the Fintech Wave

Change Financial is a rising player in the global fintech scene, offering next-gen payment and card issuing solutions to banks and institutions. Its flagship platform, Vertexon, helps clients issue and manage digital cards and transactions across multiple channels. In a world moving swiftly toward cashless economies, Change is well-positioned to benefit from digital transformation trends in finance.

The company’s strategic push into Latin America and North America has opened up large and underserved markets, while domestically, it continues to win contracts from banks in Australia and New Zealand. These wins reflect increasing confidence in the company’s technology and operational capabilities.

Change’s recent innovation, PaySim—a real-time simulation tool for card issuers—enhances testing capabilities and meets rising regulatory demands. This product not only creates new revenue streams but also deepens customer relationships by offering a full-stack solution.

Financially, the firm is showing solid momentum. In the first half of FY25, Change generated $10.81 million in revenue, representing a 60% increase year-over-year. Although it reported a net loss of $2.62 million, the management has laid out a clear path to profitability by FY2026, focusing on recurring revenues and scaling its client base.

With the tailwinds of open banking reforms, AI integration, and growing demand for cybersecurity and digital banking, Change Financial stands out as a growth penny stock with strong long-term potential.

Navigator Global Investments (ASX: NGI)
Undervalued Asset Manager with Strong Cash Flow

Navigator Global offers a compelling story for value-focused investors. As a multi-affiliate asset manager, NGI partners with hedge funds and alternative investment firms, earning stable and recurring management fees. Its diversification across strategies and geographies reduces risk while enhancing scalability.

Investor interest in hedge funds, private equity, and ESG products continues to rise, benefiting NGI’s business model. In 2024, the company strengthened its global footprint by acquiring a new affiliate, significantly increasing its assets under management (AUM) and broadening client exposure in the US and Europe.

The company’s H1 FY25 results were impressive. Revenue surged 26% to $247.43 million, while operating cash flow skyrocketed 291% to $48.36 million—a strong indicator of financial health. Despite this performance, the stock trades at a PE ratio of just 3.42, making it one of the best penny stocks ASX investors might be overlooking.

In terms of shareholder returns, NGI declared a dividend of $0.04 AUD per share, translating to a yield of 2.71%. This makes it one of the few penny shares offering a decent income stream, while investors wait for the stock to re-rate in line with its earnings power.

Navigator’s strong fundamentals, robust cash flow, and undervalued stock price make it a high-conviction pick among cheap ASX stocks with real growth drivers.

EZZ Life Science (ASX: EZZ)

Targeting the Future of Health and Wellness

EZZ Life Science is an emerging leader in the biotechnology and life sciences sector. The company develops premium health supplements, skincare, and genomics-driven wellness products—categories that are seeing exponential global demand post-COVID.

Its strategy centers around capturing consumer trends in anti-aging, immune support, gut health, and brain health. EZZ’s partnerships with top e-commerce platforms such as JD.com and Tmall in China have opened the floodgates for rapid online sales growth. Southeast Asia is also emerging as a promising growth market, backed by rising health awareness and expanding middle-class demographics.

Genomics-based wellness is another area EZZ is investing in, aiming to provide personalized health products backed by scientific research. With an expanding product innovation pipeline, the company is positioned well to differentiate itself in a crowded marketplace.

Financials for H1 FY25 show a 40% jump in revenue to $30.29 million, with EBITDA growing by 185.27% to $4.81 million. This reflects not only strong sales execution but also improvements in operational efficiency. The company declared a dividend of $0.02, giving it a dividend yield of 1.61%, while its PE ratio sits at 11.7 — suggesting the stock is still reasonably priced.

EZZ’s sharp focus on health trends, international expansion, and strong financial performance make it a top candidate among growth penny stocks on the ASX today.

Final Thoughts: Should You Buy Penny Stocks on the ASX?

Investing in high risk stocks like penny shares is not for the faint-hearted. These stocks can be volatile, and company fundamentals can shift quickly. However, for investors with a higher risk tolerance and a longer time horizon, the ASX is home to several small cap stocks that offer the right blend of innovation, scalability, and financial improvement.

Change Financial, Navigator Global, and EZZ Life Science represent three very different sectors—fintech, asset management, and life sciences—but they share one thing in common: high potential for future growth. Each of these cheap ASX stocks is backed by strong revenue trends, scalable business models, and a strategic focus on expanding markets.

In the world of growth penny stocks, getting in early is key. While risks remain, the upside can be explosive. Whether you’re seeking digital disruption, steady cash flow, or biotech innovation, these best penny stocks ASX could be just what your portfolio needs to take off.

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