Lloyds Banking Group plc (NYSE:LYG)
Latest TTM Net Income: $4.93 Billion
Closing price on June 26: $4.21
At the top of our list of ten most profitable penny stocks to invest in now stands Lloyds Banking Group plc (NYSE:LYG). It is proving to be one of the most fundamentally sound penny stocks in the market, offering investors a powerful combination of profitability, scale, and steady income. With a trailing twelve month net income of $4.93 billion and a current share price of $4.21, Lloyds Banking Group plc (NYSE:LYG) stands out as a value play in the financial sector.
In its Q1 2025 earnings report, Lloyds Banking Group plc (NYSE:LYG) beat analyst expectations with earnings per share (EPS) of $0.11, versus the $0.08 consensus. This performance reflects strong operational momentum, underpinned by a diversified business model spanning retail banking, commercial lending, and insurance.
The bank reported statutory profit after tax of £1.1 billion, delivering a solid return on tangible equity (ROTE) of 12.6%. Net income rose to £4.4 billion, up 4% year over year, supported by a healthy net interest margin of 3.03%, up 6 basis points from the previous quarter. Deposits grew by £5 billion, while lending increased £7.1 billion, fueled by strong mortgage and commercial activity.
Even with front loaded severance expenses and inflationary pressures, operating costs were well managed at £2.6 billion. Excluding severance, costs only rose 3% year over year, highlighting Lloyds Banking Group plc (NYSE:LYG) continued focus on cost discipline and efficiency.
Asset quality remains robust, with an impairment charge of £309 million, translating to a conservative asset quality ratio of 27 basis points. The bank’s CET1 capital ratio stands at a healthy 13.5%, ensuring resilience amid economic uncertainty.
With steady income growth, a strong balance sheet, prudent risk management, and clear visibility on its 2025 outlook, Lloyds Banking Group plc (NYSE:LYG) offers both stability and upside potential, making it an attractive penny stock for investors seeking high quality exposure to the U.K. banking sector.
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