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Seeing an investment double in a short timescale is the kind of thing penny stocks investors dream of. And that’s what just happened to Steppe Cement (LSE: STCM), before its shares dipped back a bit from their 52-week high earlier in October.
A company in the cement business isn’t the kind that growth-share dreams are usually made of. But I see it as a nice change when the headlines are so full of AI talk. There’s more to Steppe Cement than might immediately catch the eye, including more than the forecast 9.1% dividend. Let’s dive in and see what it’s all about…
Turnaround just starting
Steppe’s third-quarter trading update caused a bit of excitement. For the three months ending 30 September, the company posted a 19% rise in revenue compared to the same quarter of 2025, reaching $47.2m.
And for the nine months, revenue of $107.3m came in 43% ahead of the same period last year. That’s based on selling 1.63m tonnes of cement so far in 2026, compared to 1.55m tonnes at the same stage last year.
Actually, these figures in dollars are only approximate, as the company based them on revenue in KZT. And for those who don’t know, which included me until this month, that’s the Kazakhstani Tenge.
Yes, Steppe Cement operates in Kazakhstan, through a Malaysia-based holding company. Does that add an extra layer of risk, working in a developing country via a different country? Oh yes, I’d say it does, for sure.
Optimism ahead?
On the bright side, the company is listed on the Alternative Investment Market (AIM) in London. So there’s some regulatory protection there — if noticeably less than for the main London market. And Steppe has been in business since the 1950s. So it’s not some flash-in-the-pan start-up.
To help balance the risk, Steppe’s potential valuation appears attractive. I can find no analysts offering forecasts, unfortunately. But based on first-half results, we could be looking at a full-year price-to-earnings (P/E) ratio of only a bit over six. And if that Q3 strength carries over to the final quarter, it could end up even lower than that.
Then there’s the dividend. At interim time, the company announced a dividend equivalent to 2p per share. If that’s repeated in the second half, shareholders could even end up with a 10% dividend yield — ahead of the Yahoo! forecast I quoted above.
What’s the bottom line?
Looking back at historical share prices doesn’t tend to tell us a lot. But I find it impossible to ignore where Steppe shares have previously been.
Down in the doldrums for the past 16 or 17 years, is where. But in the first decade of the century, they traded at over 300p at their peak. It shows, once again, a penny stock that only got so low after starting higher and something going wrong.
But with all that said, should penny-stock growth investors consider Steppe Cement shares today? Actually, I think they might do well if they do. But I’d always suggest approaching it as a small part of a diversified portfolio, mainly based on top-quality UK shares…
Should you invest £5,000 in Steppe Cement right now?
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Alan Oscroft does not hold any positions in the companies mentioned.
This story originally appeared on Motley Fool
